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The start of the first rainy season provides wage labor opportunities

  • Key Message Update
  • Yemen
  • March 2024
The start of the first rainy season provides wage labor opportunities

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  • Key Messages
  • Key Messages
    • In March, most poor households are benefiting from slight temporary improvements in access to food and income resulting from increased social support during the holy month of Ramadan (early March to early April) and seasonal agricultural activities. In the highlands, the recent timely start to the March to May first rainy season is supporting agricultural activities and providing opportunities for labor. In addition, the recently concluded cereal harvest along the Arabian coast and the ongoing winter cereal harvest in the northern highlands are providing households with a slight increase in support from crop production or labor wages in these areas. However, given the severe impacts of years of protracted conflict on the economy and livelihoods, these seasonal improvements are not enough to enable most poor households to meet their basic needs, particularly given several rounds of assistance cuts in recent years. Across the country, Crisis (IPC Phase 3) and Crisis! (IPC Phase 3!) outcomes remain widespread. In areas controlled by the Sana’a-based authorities (SBA), a growing number of households are likely facing Emergency (IPC Phase 4) or worse outcomes amid the pause in humanitarian food assistance that has been ongoing since December 2023. 
    • In 2016, the internationally-recognized government (IRG) relocated the Central Bank of Yemen (CBY) to Aden, while the SBA maintained control of the CBY in Amanat al Asimah (Sana’a city). This triggered a deep division within the country's banking and financial sectors. In the latest series of developments, the CBY-Aden issued a circular on March 20, 2024, banning financial transactions with five commercial banks for allegedly violating CBY-Aden regulations. In retaliation, the Sana'a-based CBY banned transactions dealing with two Aden-based banks. This led to the temporary cessation of all formal money transfers between IRG and SBA areas. By March 27, both CBYs had lifted the respective bans, allowing money transfers to resume in time to avoid severe impacts on affected households who depend on internal remittances, which typically increase during Ramadan. However, tensions remain high, and economic warfare between the IRG and SBA is likely to continue. 
    • In recent years, IRG-controlled areas have been the most impacted by deteriorating economic conditions linked to shortages of government revenue and foreign exchange as well as poorly functioning state institutions with insufficient regulatory power. Due to worsening foreign currency shortages associated with ongoing disruptions to oil exports, the CBY-Aden is no longer able to hold regular public currency auctions, with only five auction rounds conducted from January to March. In this environment, the Aden-based rial has continued to depreciate month-on-month. On average between February and March 2024, the Aden-based rial depreciated by an additional 4 percent, for a total 33 percent loss of value compared to the same time last year. 
    • In IRG-controlled areas, depreciation of the currency and high fuel prices have increased the costs of importation, processing, and transportation, maintaining upward pressure on food prices. In March 2024, the baker’s association in Aden raised prices of bread by a full 40 percent, from 50 to 70 YER per loaf, citing rising production costs. The baker’s association last increased bread prices in November 2021, by a staggering 67 percent, and has been reducing the size of bread loaves in the intermediary period. The latest increase in bread prices deals a severe additional blow to poor households, many of whom were already unable to meet basic food needs. This trend is likely to increasingly force households to skip meals or reduce portion sizes, exacerbating both the scale and severity of acute food insecurity. On the other hand, bread prices across SBA-controlled areas—including Amanat Al Asimah—remain generally stable, linked to the stability of the local currency and strict price controls by authorities. However, bakers and other small businesses in SBA areas complain of losing profits due to high production and operating costs. 
    • There is no evidence to date that insecurity in the Red Sea has impacted Yemeni imports. However, military action in the Red Sea continues to threaten fishing livelihoods and the marine ecosystem. On February 18, SBA forces sank a ship carrying more than 21,000 tons of ammonium phosphate fertilizers and fuel in the Red Sea. According to the East African Development Organization, this oil leak would destroy coral reefs and marine life in the Red Sea and the Gulf of Aden. This would in turn impact thousands of Yemenis whose livelihoods are linked to fishing. In early March, a team of UN experts arrived to assess impacts, and response planning is ongoing in collaboration with the Yemeni government.
    • The March to May first rainy season has to date been characterized by near average cumulative rainfall. The promising start to the rainy season is expected to support typical agricultural activities related to land preparation and planting, providing opportunities for agricultural labor, and the replenishment of pasture for livestock following the dry season. However, the population in at least nine governorates reportedly witnessed heavy to moderate rainfall during March. In Shabwah, the rains cut off the international coastal road linking Aden and Hadramawt, disrupting trade and population movement. Roads were also damaged in Lahij and Abyan. In Marib, government estimates indicate that more than 6,500 displaced households across more than 200 displacement sites were negatively affected by heavy rainfall and the destruction of temporary shelters. Five people were also reportedly killed by flooding in Ibb.

    Recommended citation: FEWS NET. Yemen Key Message Update March 2024: The start of the first rainy season provides wage labor opportunities, 2024.

    This Key Message Update provides a high-level analysis of current acute food insecurity conditions and any changes to FEWS NET's latest projection of acute food insecurity outcomes in the specified geography. Learn more here.

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