Banks cut credit lines for traders shipping food to Yemen, report says
International banks have cut credit lines for traders shipping food to war-torn Yemen, choking off vital supplies to the country which faces the risk of famine.
A trading source, speaking on condition of anonymity from Yemen, said Friday that supplies are shrinking because international lenders are increasingly unwilling to offer letters of credit amid security concerns in Yemen.
Yemen has been under a crippling air and sea blockade by Saudi Arabia for nearly a year as the regime in Riyadh has been engaged in a deadly campaign against the impoverished country.
The Saudi aggression and blockade, which has been meant to undermine Yemen’s Houthi Ansarullah movement and restore power to the fugitive former president, Abd Rabbuh Mansour Hadi, has left 21 million people out of Yemen’s population of 26 million in need of humanitarian assistance.
The source said foreign banks are unwilling to process Yemen’s payments because ports have turned into battlegrounds and the financial system is disrupted due to the Saudi attacks.
“Western international banks no longer feel comfortable processing payments and are not willing to take the risk,” said the source.
Yemen relies on seaborne imports for almost all of its food needs, as the country lacks sufficient seasonal rains while access to farming areas is limited. Estimates show that over half of the Yemeni population is suffering from malnutrition as a result of the Saudi onslaught.
Traders face even more risks and have to effectively guarantee entire cargoes, usually worth millions of dollars, before the prospect of getting paid, said the source, adding, “There are just more and more obstacles now to bringing goods into Yemen.”
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