Houthis and Yemeni government agree to end economic hostilities, expand Yemenia flights

Yemen’s internationally recognized government have reached an agreement with the Houthis, facilitated by Saudi Arabia, to lift economic sanctions and increase the number of Yemenia Airways flights from Houthi-held Sanaa. (AFP/File)

• UN’s special envoy for Yemen, Hans Grundberg, welcomes deal and acknowledges ‘significant role’ of Saudi Arabia in achieving it
• Following the surprise announcement, Grundberg said the UN was ready to work with all parties to implement the agreed measures

AL-MUKALLA: Yemen’s internationally recognized government have reached an agreement with the Houthis, facilitated by Saudi Arabia, to lift economic sanctions and increase the number of Yemenia Airways flights from Houthi-held Sanaa.
Hans Grundberg, the UN’s special envoy for Yemen, said both parties agreed to ease economic hostilities by canceling their most recent actions taken against banks in areas the other controls and pledged to halt all such measures in the future.
They agreed to increase the frequency of national carrier Yemenia’s flights from Sanaa to Jordan from one to three a day and to introduce daily flights from the capital to Cairo and India. In addition, the two sides will hold discussions about administrative, technological and budgetary issues related to the airline.
They will also hold talks on the humanitarian and economic challenges under an UN-proposed peace plan known as “the road map.”
Following the surprise announcement, Grundberg said the UN was ready to work with all parties to implement the agreed measures. He also “recognized the significant role of the Kingdom of Saudi Arabia in bringing this agreement about.”
The economic dispute between the government and the Houthis escalated in recent weeks when the government’s Central Bank sanctioned six banks in Houthi-held Sanaa and withdrew their licenses after they refused to relocate their headquarters from Sanaa to government stronghold Aden. The Central Bank had also withdrawn banknotes printed before 2016, which were in extensive use in Houthi-controlled areas, and shut down currency-exchange companies.
The economic sanctions were introduced after the Houthis this year, for the first time since the start of the civil war a decade ago, minted a new currency. The Yemeni government viewed this as an effort by the militia to establish an autonomous economy. The government also ordered Yemenia and telecoms companies to relocate their headquarters to Aden.
In an attempt to put pressure on the government to end its severe economic sanctions, the Houthis seized control of four Yemenia aircraft last month, announced that they would run the airline from Sanaa and threatened to fully restart the war. The militia previously attacked oil terminals in the government-controlled provinces of Shabwa and Hadramout, halting oil exports and preventing the circulation of banknotes printed by the Central Bank. They also banned traders in areas under their control from importing goods through the government and blocked the import of gas from the central city of Marib.
The Yemeni government said it eased its economic sanctions and reached an agreement with the Houthis to avoid exacerbating the economic crisis in militia-controlled areas, in response to requests from the business community and to comply with UN, regional and international mediation efforts.
“The government reiterates its steadfast determination not to subject Yemeni citizens in regions violently controlled by Houthi militia to additional living costs as a consequence of the militants’ unilateral actions, and to allow them to travel,” the official SABA news agency reported.
However critics of the deal, such as Kamel Al-Khoudani from the political bureau of the Yemeni National Resistance, said the government had conceded to Houthi demands for additional flights and an end to punitive measures against banks in Sanaa even though the militia had failed to meet counter-demands, including the resumption of oil exports.
Supporters, such as Yemeni journalist Sami Al-Kaf, argued that the government had successfully coerced the Houthis, who have previously rejected all demands to participate in negotiations, into agreeing to economic talks.