A Collapsing currency in Internationally Recognized Government of Yemen (IRGY) areas is driving up food and fuel prices, according to the latest report issued by Food and Agriculture Organization of the United Nations (FAO).
The report found that Yemen's food security is facing significant pressure from a number of complex and overlapping threats.
The designation of the Central Bank in Sana'a - controlled by the Houthi rebels – by the United States government, as an FTO (Foreign Terrorist Organization) and related sanctions have severely disrupted the banking sector, impacting payment systems, remittances, and international transfers.
These issues are compounded by a widespread wage collapse and seasonal challenges, further worsened by a ban on wheat flour imports.
The report mentioned that the recent escalation of the Middle East crisis presents an additional risk of increased fuel prices. Even though milling capacity and port infrastructure are generally adequate, potential fuel shortages in the Houthi rebels-controlled areas could interrupt milling operations, leading to higher wheat flour prices despite existing controls.
Finally, the substantial decrease in imports—including food, fuel, and other non-food items—flowing through the main Hodeidah Port is a major concern that could disrupt markets and further threaten food security.