MUKALLA: Car dealers in the southern Yemeni province of Hadramout are conspicuously using the Saudi riyal when selling cars, a practice that is common.
Hussein Saeed Bamasoud, owner of Al-Authibi Car Lot in Mukalla, the capital of Hadramout, said cars have been sold in the Saudi riyal since the 1990s.
“We depend on the Saudi riyal in our business because it is easy to carry and stable. We don’t mind using other currencies but the customers know that when we say riyal we mean the Saudi riyal,” he said.
“Many car dealers in Yemen use the Saudi riyal. We bring the cars from a local Toyota agent in Yemen. The market improves during the summer vacation when thousands of Yemeni expatriates return home,” he added.
The owner of another car lot told Arab News that many car dealers bring their cars from the Kingdom. “The Yemeni riyal is not stable. The local currency may gain value one day and then drop the next day,” he said.
“If they are given Yemeni riyals, the car dealers think it might take them a long time to change the currency into Saudi riyals as they want to return to the Kingdom,” he added.
Omer Al-Tamimi used to work at a moneychanger in Hadramout. He said he used to often see people receive remittances from the Kingdom and use the money to buy cars. “I think this is why the Saudi riyal has become a dominant currency in the Yemeni car market. Many people depend on remittances from their relatives in the Kingdom,” he added.
Ali bin Al-Shaibah, a financial analyst and lecturer at Al-Ahgaff University, gave an economic explanation for the phenomenon. “Since no one can keep the lid on inflation, local traders resort to using the Saudi riyal because it is stable and an easily changeable currency. If a person buys a car for SR50,000, he gets the same price if he uses the Saudi riyal. However, if he uses its equivalent in the Yemeni riyal, he could sustain a heavy loss,” he said.
Al-Shaibah added that local traders also use the Saudi riyal to give gold prices.
