Yemen slides closer to famine as frozen bank funds curb food imports
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LONDON/ABU DHABI - Many areas of Yemen are close to famine partly because importers are unable to buy new food stocks from abroad as over $200 million is stuck in banks due to the civil war disruption, trade and aid sources involved say.
Western banks had already cut credit lines for traders shipping food to Yemen, fearing they would not be repaid due to the security chaos and fragile financial system. Now, they are increasingly unwilling to offer letters of credit, which guarantee sellers will be paid on time.
They are reluctant to offer guarantees because the banking system has seized up.
