Economist: The Central Bank is no longer able to control the banking sector in government-controlled areas

Mustafa Nasr, head of the Center for Economic Studies and Media, said that the return of the Presidential Leadership Council Chairman Rashad Al-Alimi yesterday to the interim capital, Aden, accompanied by the economic team, is a message through which he wants to say that the economic file is among the council’s priorities, in addition to a message of reassurance to the people that they are there to take what is necessary regarding the rapid collapse in exchange rates.

Mustafa Nasr asked in a statement to the "Yemeni Youth" channel, to what extent will the government and the Leadership Council be able to achieve progress in controlling the stability of the exchange rate in light of the economic challenges, especially in light of the accelerating collapse of the currency, the scarcity of local resources and their leakage into multiple black holes, and the bank's inability to pay employees' salaries to this day?

The head of the Center for Economic Studies and Media pointed out that the Central Bank has explicitly announced that there are greater challenges than it, and that expenses are greater than revenues, including overdrafts to cover obligations, stressing that all of these are burdens on the Central Bank.

Regarding the return of Lieutenant General Al-Attas, Mustafa Nasr said that Al-Attas' return to Aden after 30 years of absence has political dimensions more than economic ones, stressing that the economic situation in the legitimate areas is very critical, and if the situation continues without intervention, especially from the coalition countries, led by Saudi Arabia, then what is coming will be more difficult, and the government and the Leadership Council will be facing a very critical situation in the next stage.

He pointed out that Saudi Arabia had provided financial assistance in the past period amounting to $200 million, which covered to some extent salaries and other operating expenses in light of the decline in government revenues, in addition to supporting electricity in Aden and some governorates in light of the deterioration of stations and the high costs of fuel and others.

Regarding the role of the Central Bank of Yemen, Mustafa Nasr pointed out that the Central Bank in Aden, after reversing its recent decisions regarding the transfer of the main banks’ headquarters to Aden, its role has become one of facilitating business only, and its ability to control the banking sector has become very limited.

He added, the Central Bank has become aware that there are variables and interests at the regional and international levels, and that the Yemeni file has become a regional and international file, and therefore it does not have any ability to make independent decisions, which has weakened its role in controlling the banking sector in areas under government control.