Yemen is living in a state of anticipation of the repercussions of the decision to transfer the headquarters of the most prominent commercial banks from the capital, Sanaa, under the control of the Houthis to the city of Aden in the south of the country, which is the main headquarters of the internationally backed government.
A week ago, the internationally recognized Central Bank, which is managed by the internationally recognized government, announced that 8 commercial banks in Sana’a were notified that it would transfer its main headquarters to the city of Aden, the temporary capital of the country.
The Central added – in a statement – that these banks are the Solidarity Bank, Al -Karimi Bank for Microfinance Islamic Finance, Yemen and Comprehensive Bahrain Bank, the Yemeni Islamic Bank for Finance and Investment, the Saba Islamic Bank, the Bank of Yemen and the Gulf, the Yemeni Commercial Bank, and the Bank of Hope for Microfinance.
These are the largest and most prominent commercial banks in Yemen, and their main headquarters are in the capital, Sanaa, according to Al -Jazeera Net correspondent.
The decision of these banks came days after the United States of America announced the entry into force of the Houthis, an official terrorist organization, declaring sanctions on 7 senior leaders in the group.
This comes amid fears of the imposition of US sanctions on these banks under the control of the Houthis, as part of Washington’s efforts to stifle the group financially, amid the intense conflict between the two sides.
Last January, the US Treasury imposed sanctions on the Bank of Yemen and Kuwait, and it is a commercial working in the group’s control areas, in a procedure that is the first of its kind to target a commercial bank owned by the private sector.
These developments are highlighted with the continuation of the economic conflict between the Yemeni government and the Houthi group, amid an unprecedented severe financial crisis that the country suffers from, and among the worst humanitarian and economic crises in the world.
Compulsory procedure
At a time when Yemenis ask about the possibility of implementing the decision to transfer banks ’headquarters to Aden, and the impact of this on the country’s banking and financial sector, banking expert Abdul Salam Al -Shuja’i says that these large banks are serious in transferring their headquarters to Aden as they do not have an option after the Houthis classified a terrorist organization, and concerns about stopping the Swift service (for international transfers) in the group control areas.
He added – in a comment to Al -Jazeera Net – that the Yemeni government will benefit from the process of transferring banks ’headquarters in enhancing its financial legitimacy, controlling the financial system, enhancing the ease of the process of transfers in its areas, and paying for increased revenues such as fees, taxes and others.
On the other hand, the brave believes that the transfer of banks ’headquarters will lead to an increase in financial isolation in the Houthi control areas, and a social impact may occur in increasing the intensity of the economic crisis, lack of liquidity and weakness of the group’s control over the main assets of banks.
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He pointed out that after the transfer of banks ’headquarters to Aden, the banking system in the government regions will be safer and open, and more capable of investing, and management of cash and control of its assets, especially if there are no reverse actions in the assets that fall under the control of the Houthis as a punishment for banks to transfer their headquarters.
He considered that the internationally recognized government’s monetary political possession of the country is an important step in order to unify the price of the local currency, especially as the gap remains wide between the currency price in the government regions and the Houthi control areas, and requires a tireless work and a clear monetary policy.
The price of the Yemeni riyal has been divided for years, as the dollar is currently spent in areas controlled by the Houthis by about 530 riyals (ancient edition) compared to nearly 2,300 riyals (a new edition) in government influence areas.
Government gains
The journalist specializing in economic affairs, Mohamed Al -Jamaa’i, says that the transfer of bank departments to Aden is achieving the internationally recognized government 3 gains as follows:
- Removing the cash division caused by Houthi policies and reactions to any government move or step to correct or address the situation.
- The liberalization of the banking sector and the transformation of the path of external transfers coming to Yemen in its two sides (expatriates- international organizations) through the temporary capital, and thus the loss of Houthi is the advantages of those annual billions.
- Create the atmosphere and conditions for the transfer of headquarters or operations of public departments for major companies, organizations and embassies to Aden, and transferring the maritime navigation path through government ports according to the tools they have.
The collective believes that Sana’a will lose its position as a first financial center for the country as a result of the negative accumulations and cracks caused by the systematic Houthi policies against the banking sector and the entire private sector, in addition to severe moral losses in front of the residents living in its areas, and the group’s ability to militarily disappear, according to its description.
He pointed out that the Houthi group will face difficulty in forming new financial networks to transfer money by official means, as it may be subject to strict control in Aden.
Great complications
In light of the great complications in the Yemeni crisis, there are those who see difficulties in the issue of applying the transfer of the main headquarters of banks to Aden.
In the context, the economic researcher residing in Sana’a Rashid Al -Haddad says that talking about the transfer of banks still comes within the framework of political and economic employment of the American classification decision for several aspects:
- The central bank in Aden, which is recognized by the internationally recognized Aden, stated in its statement that the deal was made through a written message from the banks, and it is recognized that official and governmental banks are officially communicated with them, and that Sana’a banks did not confirm this matter.
- Transfer of bank centers at the present time it is impossible to happen due to the very large security and economic insecurity and the failure of the central bank in Aden to stop the collapse of the currency and others in government control areas.
- Commercial banks have a public debt for the government that the Central Bank is committed to in Sanaa, and in the event that they moved and transferred these money to Aden, the bankruptcy process will occur and depositors will tend to withdraw their money.
- The American Finance Network “Western Union” and “Money Gram” and others are still working under the control of the Houthis smoothly and without any restrictions or pressure.
Al -Haddad pointed out that the government of Sanaa controls more than 65% of the total Yemeni market, as well as the commercial movement, depositors and bank activity, which is concentrated by 80% on the governorates under the control of the Houthis.
Regarding the advantages that the internationally recognized government may obtain from the transfer of banks to Aden, Al -Haddad says: “You will not get any benefit, and the evidence is that it transferred the jobs of the Central Bank of Yemen from Sana’a in 2016 and the currency exchange price is 251 riyals per dollar and failed to manage the economic file, and the dollar price is now about 2300 riyals.”
