WITH hindsight Shawki Hayel, Yemen’s most successful industrialist, made a mistake putting his food-processing plant in his hometown of Taiz. The town straddles the front line where northern Houthi rebels are fighting the Saudi-backed government in the south and the war has been harshest. Imports of flour for his biscuits are haphazard because of a Saudi-led blockade at Hodeida, the country’s largest commercial port. Warlords on the road in between erect checkpoints to rob travellers and merchants. And then there is the problem of payment. Abd Rabbo Mansour Hadi, the president, moved Yemen’s central bank from Sana’a, the capital seized by his northern Houthi foes in January 2015, to Aden, a southern port now controlled by soldiers from the United Arab Emirates (UAE), but had to leave its bureaucrats and database behind. Government employees have not been paid since July. Banks have stopped issuing letters of credit or cashing cheques.
As Yemen’s formal economy collapses, a war economy has taken its place. For a fee, any truck can pass checkpoints without inspection, no matter what it carries. Weapons-smuggling is rife; particularly, says a diplomat, of Saudi-supplied...Continue reading
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