SEMC: Devaluation of Yemeni Rial legitimizes black market prices

The Studies and Economic Media Center (SEMC) has described the decision by the Central Bank of Yemen to devalue the Yemeni Rial to YR 250 against the US dollar and YR 65 against the Saudi Rial as legalizing black market prices. The Yemeni rial uses to change hands at 215 against the USdollar , and 57 to the Saudi Rial. The center said in a press statement that the decision reflects the scale of foreign cash reserve crisis the country is suffering, as well as the CBY’s inability to meet the market’s requirements of foreign cash. It warned that the move would cause the local currency to drop below 300 to the dollar unless it did not go in line with a package of financial and fiscal reforms, atop of which are the provision of market requirements of foreign currency, and stemming the bleeding of foreign currency, which resulted from the arbitrary decisions made by the bank over the past months. It further warned the bank of falling into the trap of trying to keep up with the unofficial exchange rate. It revealed that the previous decisions made by the bank to convert foreign remittances into Rials has created a network of black market mafias dealing in the local currency and involving some banks and their staff. It hailed the bank’s new decision paying foreign remittances in the same currency that enters the country. The economic think-tank urged the bank to provide the private sector’s oil product importers with hard currency, and to strictly control the prices of fuel at the local market, which are two times as much as global prices. SEMC is a high-profile NGO specializing in training in economic and media fields, and working towards the enhancement of transparency, good governance, and public engagement in decision-making, the creation of professional and free media, and the economic empowerment of youth and women.