Cash Flow: Breaking Down the Houthis’ Multibillion-Dollar Financial Networks

Adam Rousselle

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Yemen-based Ansar Allah, widely known as the Houthis, continues to have a profound impact on global security. The group’s ongoing operations in the Red Sea affected an estimated US $1 trillion worth of maritime cargo between October 2023 and May 2024, and despite periodic kinetic attacks, its operations show no signs of abating. Moreover, evidence suggests the Houthis enjoy the financial and military backing of Russia and China, in addition to their established ties with Iran. This Insight explores the Houthis’ financing mechanisms, including leveraging technology to evade sanctions and the involvement of foreign facilitators with demonstrable and plausible ties to foreign governments.

Generating Cash Locally and Abroad

Contrary to some popular conceptions, the Houthis’ relationship with Iran and other foreign backers is not that of a charity case. Although the group benefits from its foreign partnerships, it must generate revenue to pursue its own ends. For this reason, the Houthis oversee vast global financial networks, engaging in illicit trade and leveraging technology to finance its multibillion-dollar operation.

Air attacks against the Houthis in Yemen have constrained their local revenue generation potential. In recent years, the group’s control over ports near Hodeida has been central to its local revenue streams as Yemen highly depends on imports, which serve 90% of its needs, including basic foodstuffs and fuels. The Houthis capitalise on this reality by levying high fees at ports under their control and tariffs of up to 100% on goods brought in from Yemeni ports outside of their control. The group also uses its ports to generate revenue through smuggling operations, reselling Iranian oil and weapons to buyers in East Africa, including the Somalia-based al-Shabaab and Islamic State Somalia (ISS). However, the ongoing war has likely taken a toll on these revenue generation schemes, with the recent bombings of key Houthi ports damaging much of the group’s core infrastructure.