Yemeni Currency Strengthens Following Saudi Arabia’s $1.2 Billion Aid Pledge
The Yemeni rial strengthened against the dollar on Wednesday, following an announcement by Saudi Arabia that it will extend $1.2 billion in economic aid to Yemen to help alleviate the country’s budget deficit. Money traders in Aden noted a significant recovery as the currency jumped from 1,430 to 1,382 against the dollar.
The resurgence of the Yemeni currency is noteworthy against the backdrop of Yemen’s many ongoing struggles, including suspended crude oil exports, its primary income source, and stalled peace talks between the Yemeni government and the Houthi rebels.
Local experts attributed the rial’s appreciation to the optimism generated by Saudi Arabia’s financial commitment. However, they caution that consistent efforts are needed to address the underlying issues contributing to the currency’s decline.
The aid package is part of the Saudi Development and Reconstruction Program for Yemen and is intended to cover operating expenses and guarantee food security. Saudi Arabia provided $4 billion to Yemen’s Central Bank between 2012 and 2022, reducing fuel and food prices for many Yemenis.
