The heightened interest in cryptocurrencies across the Gulf is taking place alongside global efforts to both regulate digital assets and attract cryptocurrency firms.
On June 19, UAE-backed Yemeni forces announced that they had consolidated their control over Hodeidah airport after a week of fierce fighting with Houthi rebels for the facility as part of Operation Golden Victory, a military campaign for Hodeidah port and city.
The battle for Hodeidah will now start in earnest. Whatever the outcome, the struggle for the city is likely to mark a shift in the shape and trajectory of the war on par with the Saudi-led coalition’s entry into the conflict in March 2015, the Houthi rebels’ loss of Aden and much of south Yemen in mid-2015, and the death of former President Ali Abdullah Saleh in December 2017.
With fighting only now reaching the outskirts of the city proper, bold predictions are already being made about Yemen’s post-Hodeidah landscape. But there are so many variables and such deep uncertainty over how the battle will play out, despite consensus that the coalition will ultimately prevail, that it is impossible to present a single case as the most likely outcome. There are multiple potential scenarios for the battle, each with a different meaning for the trajectory of the conflict.
The Hodeidah campaign has been in planning since at least 2016 and, by some accounts, since the Saudi-led coalition entered Yemen’s war. Saudi and Emirati officials leading the war effort believe that the Houthis, who seized Sanaa in September 2014 along with forces loyal to Saleh, are using Hodeidah to smuggle weapons, including missile components, into the country (a point disputed by a U.N.-appointed panel of experts). The coalition, which sees the Houthis as an Iranian proxy in the mold of Hezbollah, has vowed to push the Houthis out of Yemen’s towns and cities and restore President Abd Rabbu Mansour Hadi, who the Houthis ousted in early 2015, to power. Hodeidah has come to be seen as a crucial component of the campaign.
While the coalition, the United Arab Emirates in particular, had some major successes in the early days of the conflict – notably driving the Houthis out of the southern port city of Aden and most of the country’s southern governorates in 2015, then ousting al-Qaeda from Mukalla in 2016 – the war had reached a messy stalemate by late 2016. Hoping to shake things up, the UAE proposed an amphibious assault on Hodeidah aimed at striking a strategic, symbolic, and financial blow to the Houthis, who generate hundreds of millions of dollars in revenue from the port each year. The UAE’s Western allies, particularly the United States, worried that such an assault was too risky, both for the UAE forces and the humanitarian situation in Yemen, however, and the Emiratis went back to the drawing board.
Since Saleh was killed in December 2017 by Houthi fighters, an assortment of groups branded as the National Resistance Forces have made a series of breakthroughs in their push north up Yemen’s Red Sea coast, backed by the UAE military. The alliance includes: the Tihama Resistance, led by the Zaraneq tribe; Salafist-led Southern secessionist fighters from the Amaliqa, or “Giants’ Brigade”; and, since around March, the newly-constituted Guards of the Republic, led by Brig. Gen. Tariq Saleh, the former president’s nephew.
In April and May, the National Resistance Forces made a series of rapid gains along the coastal highway, coming within 6-9 miles of Hodeidah airport by early June. Until it reached the airport, the fight had been for the major roads, towns, and interchanges along the coastal route.
On the inland highway the National Resistance Forces are yet to enter the town of al-Jarrahi, about 68 miles south of Hodeidah, which borders Zabid. Between Zabid and Hodeidah are Bayt al-Faqih and al-Mansuriyah, a small town at a major interchange that links the inland route with Sanaa, the capital. The Houthis are reportedly entrenched in each of these areas and have already used them as bases from which to launch rear-guard action against the coalition, cutting off supply lines to the Hodeidah front.
On June 19, the National Resistance Forces announced they took control of Hodeidah’s airport, setting the stage for the battle for the port and city. The UAE is building a temporary port facility in al-Durayhimi, which will allow it to connect ground operations in Yemen with its nearest base, in Assab, Eritrea, where thousands of Yemeni, Emirati, and Sudanese troops are reportedly preparing to deploy.
On paper, there is a clear mismatch: anywhere from 20,000-25,000 coalition-backed fighters with armored vehicles, air support from fighter jets and Apache helicopters, and almost unlimited resources, versus a Houthi contingent reckoned to be no more than 5,000-10,000 men, many of them recent recruits rather than hardened and dedicated fighters (the core Houthi fighting force is likely just a few thousand men), who are likely to be cut off from supplies early in the fight.
Most worrying is the outlook for the estimated 600,000 people who live in Hodeidah, and the millions of Yemenis who depend on the port as a lifeline. The United Nations and other humanitarian organizations have estimated that the fighting will displace hundreds of thousands of people, directly impact 250,000 Hodeidah residents, and have a “catastrophic” impact on the humanitarian situation. The longer the fighting lasts, the worse the outcome. With Yemenis struggling to afford basic food staples, a tightening supply (and speculative traders) will force prices upward for as long as the fighting continues.
Nevertheless, the coalition – particularly the UAE – sees the Hodeidah campaign as the best way of breaking the stalemate of the Yemen war. “Our strategic goal is to end the war in Yemen and that can’t be done while Houthis are controlling Hodeida,” the UAE minister of state for foreign affairs, Anwar Gargash, told journalists on June 18, before saying that the campaign was designed to help the U.N. special envoy to Yemen, Martin Griffiths, persuade the Houthis to “unconditionally withdraw” from Hodeidah. Griffiths had arrived in Sanaa on June 16 in the hope of negotiating a compromise solution for the port.
Four Potential Scenarios for the Battle for Hodeidah
Best Case Scenario: A Political Solution
While hope of a negotiated deal to prevent a battle for the port and city remain extremely slim, Griffiths continues to lobby the Houthis to hand the port over or at least agree to joint control, and the coalition to choose a compromise deal for the port over a military solution.
On June 19, Griffiths left Sanaa after several days of meetings with the Houthis, and will now attempt to broker a deal with the coalition. But the Houthis are only willing to cede to joint management of the port with the United Nations and a partial withdrawal from Hodeidah city. The coalition, in line with Gargash’s comments, is demanding a complete handover of the port, ultimately to Hadi’s government, and a full Houthi withdrawal. The Houthis’ response has fluctuated from signaling apparent willingness to negotiate to issuing belligerent statements on their forces’ ability to hold the port.
- A deal would ultimately see the Houthis withdraw from both Hodeidah port and city and, likely, Salif port to the north, possibly taking their heavy weapons with them. This would be a symbolic blow but would leave the Houthis in a position to redeploy forces to other frontlines (which may be disincentive enough for the coalition to agree to such a deal). The coalition would be left in control of much of the Red Sea coast, and UAE-backed fighters could move further north to link up with Yemeni forces in the port city of Midi, near the Saudi border.
- A mediated solution is the preferable outcome and could help build momentum toward a peace process. If all parties act in good faith, they could build trust of the kind needed to move toward a negotiated settlement.
- Further deepening of the humanitarian crisis could be averted and, if the coalition is to be believed, the volume of goods entering the country would increase considerably, possibly bringing prices down and making basic staples more affordable.
The Coalition’s Plan: A Quick, Clean Win
In the run up to the Hodeidah offensive, the coalition argued that the operation would be quick and clean. Multiple individuals with knowledge of the UAE’s strategy said the Emirati leadership estimated that the operation would take around six weeks from the formal commencement of the operation, which came on June 12. In conversations with foreign counterparts, UAE officials – who planned and are overseeing the operation – are providing a broad estimate of around five to eight weeks for completion of the operation.
After asserting full control of the airport, anti-Houthi forces will continue north up the coast, following the highway along the city’s western edge and cutting off the main port facilities from the urban center (they may cut the road off using airpower if this is not possible). A second contingent has already headed northeast, with the aim of cutting off the main road connecting Hodeidah with the inland highway and the main route to Sanaa. Fighting has already broken out over a crucial intersection on the highway. As forces continue to encircle the city, UAE forces plan to initiate an assault on the port itself, likely from both land and sea.
Once the National Resistance Forces have the port, they plan to move in on the city. UAE officials, according to sources briefed on current planning, believe the assault will be augmented by a local rebellion against the Houthis who will, the Emiratis say, either surrender or be defeated outright. The UAE’s timeline is not necessarily based on the complete liberation of Hodeidah city, but on the seizure of the port and a return to normal activity.
- A quick win would strike a blow to the morale of Houthi fighters and significantly boost their rivals – and would likely lead to renewed efforts on other fronts, including in Nihm (northeast of Sanaa) and Taiz. If the Houthis were to be beaten this quickly, the image of military strength they project could be punctured. The loss of Hodeidah is not likely to lead to a Houthi surrender, however; the group has threatened reprisals that could include a fresh wave of ballistic missile attacks and even a military incursion into Najran city in southern Saudi Arabia.
- After a month of bloody fighting it is unlikely that the parties will choose to return to political negotiations. Hodeidah also has symbolic value: In 1934, the newly established Kingdom of Saudi Arabia seized the city from the then-Zaydi imamate in Yemen, forcing the imam to sue for peace and renounce his claim to the provinces of Najran and Asir.
- Aside from a political solution, this is the least bad outcome for the humanitarian situation. But a month of interrupted supply of basic goods into the port and city could have big consequences for a large portion of Yemen’s population that depends on humanitarian assistance that enters via the port, particularly if clean water is not available. A cholera outbreak in the city could quickly lead to an epidemic, worsening the humanitarian situation.
Most Likely: Several Months of Fighting
The UAE is highly confident in its ability to seize control of the port within its own estimated timeline. However, the coalition has been known in the past to be overconfident in the speed at which it can achieve its aims. At the beginning of the war, Saudi Arabia predicted a victory within weeks, citing domestic resistance to the Houthis and overwhelming air superiority.
Along with Saleh loyalists, the Houthis held Aden for four months in 2015 before being pushed out by a UAE-coordinated campaign that is often cited as a precedent for Hodeidah (the counterpoint to this argument is that the UAE-backed Yemeni forces leading the Red Sea campaign are far more experienced, and better trained and prepared than in 2015). The Houthi-Saleh alliance faced internal resistance of the kind not yet seen in the Red Sea port, and never completely controlled the city or port. While there is considerable animosity toward the Houthis in Hodeidah, they also have a reputation for establishing strong – and brutal – security infrastructure in the areas they occupy. Some observers question why, if there is a large anti-Houthi force-in-waiting, Hodeidah was not lost to internal resistance in December 2017 when Saleh urged an uprising against the Houthis. The Houthis have also been aware of plans for a military campaign to take the city since late 2016, at least, and are likely to have drawn on the expertise of Iranian and Hezbollah advisors who have greater fighting experience in built up areas.
If the uprising does not happen as expected, the UAE is likely to adjust its timeline, as street fighting for the city from the outside in is likely to be a messy and lengthy affair. This is before considering the Houthis’ positions in towns and cities near Hodeidah and their presence in farming areas and the rocky outcrops and mountains of the Bura Nature Reserve, which begin about 25 miles outside the city.
Nevertheless, the coalition may be able to cut off major supply lines in and out of the city and winnow the Houthis’ ranks over time, effectively laying siege to the city. The Houthis in turn could target naval and merchant vessels around the port. The United Nations and other humanitarian organizations are likely to pressure the Houthis and the coalition to allow food, water, and fuel into the city during this period, extending a lifeline to civilians caught in the crossfire, and to the Houthis themselves.
- If the Houthis are not able to resupply, it is not clear if they will be able to sustain fighting in the city for more than a few months, and their forces are likely to be considerably diminished, and demoralized, after such a period.
- The political context will depend on how this scenario ends – through a political deal or outright military victory. A political settlement could potentially help begin the process of returning to peace talks, although the rancor – and rhetoric – is likely to be heightened. An outright military victory is likely to produce a similar outcome to the second scenario. The coalition is also likely to see a win in Hodeidah as justification for making more maximalist demands with respect to any political settlement.
- A three-month battle for Hodeidah would have a seriously detrimental impact on the humanitarian situation, both inside the city and across Yemen, particularly if the Houthis prevent ships from entering the port and fighting prevents trucks from entering or leaving the port to pick up goods. The United Nations is likely to focus on ensuring aid can cross frontlines, and to lobby both the Houthis and coalition to allow port operations to continue. However, major shipping firms likely wouldn’t risk sending cargo into the port during fighting (in Aden, for example, cargo activity dried up even when anti-Houthi forces had full control of the port). A three-month battle would likely lead to large loss of life and leave the city and its infrastructure in tatters. The likelihood of a major cholera epidemic would also increase significantly.
Worst Case Scenario: A Protracted, Destructive Battle
The broad consensus among analysts is that the Houthis will not ultimately be able to hold the port or maintain supply lines from the road network into the city. If, however, the Houthis were able to maintain a stranglehold over the port or keep overland supply lines open, there is a chance that they could withstand pressure from the coalition for a considerable period of time. This would likely lead to months of back-and-forth, before settling into the same stagnant, attritional patterns seen across the country, and would serve only to complicate the task of finding a political solution to the conflict.
A protracted fight would necessitate the deployment of Yemeni forces into the city on foot and in armored vehicles, increasing the likelihood of infrastructure damage and civilian casualties. The status of the port would depend on who controlled it – the Houthis or the coalition.
- A protracted battle would likely settle into patterns of the kind seen in Taiz, with opposing forces taking up set positions and attempting to eke out marginal gains over time, as humanitarian workers struggle to maintain access.
- A protracted battle for the city would reduce the likelihood of advances on the political track. If this were the case, Hodeidah would simply become another point over which to negotiate as part of a broader political settlement.
- At six months, the likelihood of starvation, epidemic, and the destruction of infrastructure only increases. The United Nations and other humanitarian organizations would work to ensure humanitarian access in the event of a protracted battle. If the port is deconflicted, however, the humanitarian situation could be somewhat stabilized.
The most likely outcome would appear to be something like the third scenario – a battle of two to three months that, optimistically, is ended by external intervention to prevent further humanitarian costs. Several wild-card factors could change this, however.
The United States, which thus far has refused to take part in the campaign despite UAE requests for assistance, could choose to become more directly involved, for example, by providing a minesweeper to help UAE-backed forces enter the port, and throwing its political weight behind the campaign. If, however, the humanitarian situation were to deteriorate rapidly – a cholera epidemic, for example – or a large number of civilians were killed in the crossfire, public opinion in the United States could turn quickly against the campaign, leading to pressure on the coalition from Washington to end the battle and negotiate a compromise deal with the Houthis, particularly if congressional pressure grows.
Then there is the potential for an unexpected “black swan” event that could change the complexion of the conflict. Such an event could include breakthroughs on other fronts (Nihm or Taiz, for example), further infighting among the coalition’s Yemeni allies, or a successful Houthi ballistic missile strike on a civilian target inside Saudi Arabia.
Finally, the end of the battle will only be the beginning of questions around Hodeidah. The coalition has said that it and the Yemeni government will be able to operate the port more effectively than the Houthis. Coalition officials hope that the outcome in Hodeidah will be closer to the outcomes in Mukalla and Marib – where governance and service delivery have improved since rival forces were pushed out (al-Qaeda from Mukalla, the Houthis from Marib) – compared to the experience in Aden, where infighting has become a barrier to effective local governance. If fighting continues along the Hodeidah-Sanaa road, meanwhile, it is unclear how basic goods will be delivered from the port into the country’s main population centers.
Ultimately, the battle for Hodeidah is likely to leave the Houthis in a weakened position militarily, and the coalition with the upper hand in negotiations, as the UAE believes. But this advantage will come at a significant cost, and could serve to deepen the political stalemate, leaving Yemen poorer and hungrier, and still at war.
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