Yemen: Conflict fuels economic collapse, credit squeeze

The crisis engulfing Yemen has been exacerbated by a downwardly spiralling economy, leading United Nations director of humanitarian operations John Ging to warn that a severe famine beckons (see box). Although under intense pressure, the southern provinces appear to have faired better – helped by the UAE military’s supervision of vital areas like Aden and Mukalla – while the northern economy is deeply affected by the financial crisis confronting the Central Bank of Yemen (CBY), underlining how state failure has exacerbated macroeconomic collapse and looming debt problems.