Small businesses in Yemen fall victim to both war and a currency crash

With prices of goods going through the roof and Yemenis barely able to stay afloat, small businesses in the country are being forced to shutter.
Yemen, TAIZ — Adeelah Aqeel has been sewing clothes for two decades, and in early 2015 she decided to open a shop in Taiz city to start realising her dream.

But her business of selling and renting clothes to brides didn’t last longer than three months, as violent battles started spilling into the neighbourhood and the store was damaged.

“I borrowed money and sold jewellery to start my business but the war damaged everything. Only a few dresses are left,” Adeelah told TRT World.

Adeelah was the sole breadwinner for her family of ten. So in 2019, she decided to re-open the shop.

“I brought the clothes from the old shop but no one came to buy or rent them as they are old – so I borrowed some money and bought new clothes,” she added.

“I also sewed others and started to work in the new shop together with my mother and a cousin and we managed to get a good income from the shop.”However, things didn’t last much longer after the recent collapse of the Yemeni rial against foreign currencies.

During the last two months, the Yemeni currency has collapsed in a dramatic way in the areas under the control of the International Recognized Government (IRG), from 600 rials to 1 dollar in 2019 to more around 1,400 against the dollar this month. For perspective, in 2015 it used to be 215 rials to a dollar.

“The recent collapse of the currency killed my business. I sold some clothes but couldn’t buy new ones and even the customers can’t buy clothes with the new prices,” Adeela said.

“The shop now has almost stopped and I’m struggling to pay the rent which used to be YR 150,000 ($125), but is now more than double.”

Adeelah doesn’t have any other source of income and is doing her best to continue but it isn’t really in her hands.

“Last time it was the battles which damaged my shop but now it is the increase of prices that is closing many small businesses.”

The currency crash has naturally led to the bankruptcy of several small businesses in the southern areas of Yemen but that isn’t the case in the areas under the Houthi control as 1 dollar equals 600 rials in those areas.

Yasin Al-Kamel, 28, has been working in a small sports equipment and supplies shop in the city of Taiz since 2017. Yasin said that he used to earn a good income by taking advantage of most of the shops for sports equipment and supplies being closed because of the war.

“It is difficult to find a job amid the war so I decided to start selling sports supplies and that was good until the recent collapse of the currency,” Yasin told TRT World.