Mohamed Ghobari, Ahmed Tolba

ADEN (Reuters) – Yemen’s President delegated power on Thursday to a Presidential Council and dismissed his deputy. Saudi Arabia is trying to build an anti-Houthi alliance in the midst of U.N.-led negotiations to end seven years of war.

After President Abd-Rabbu Mansour Hadi’s announcement, Riyadh provided $3 billion of financial assistance to the Saudi-backed government. The Houthis, who have been fighting the Saudi-led alliance in the north, called for negotiations.

In a significant breakthrough, Yemen’s warring parties had reached an agreement on a truce lasting two months that was effective Saturday. This deal lifted a blockade by coalition forces on the Houthis-held areas. Hadi was ousted from Sanaa in the late 2014 and the government of Hadi is now in exile.

Hadi from Riyadh said that “I irreversibly delegate my full powers to the Presidential Leadership Council in accordance with both the constitution, the Gulf Initiative, and its executive mechanisms.”

Hadi was appointed to the top of a crumbling country in a Gulf-backed Transition Plan a decade ago. This plan followed protests against President Ali Abdullah Saleh who was then killed.

Analysts believe the new council will unify anti-Houthi groups by giving more parties a place at the table. The hope is that the Houthis will be less hostile with Hadi out of the picture and his deputy fired.

Mohammed Abdulsalam (Houthi chief negotiator) criticized the move calling it a farce, and “desperate effort to restructure mercenaries ranks to push them toward further escalation”.

Riyadh has been struggling to end the war in Yemen and urged the council under U.N. auspices to reach a “final and comprehensive resolution”

CLOSING RANGERS

In a video, Mohammed bin Salman, Saudi Crown Prince, was seen with eight members of the council. The meeting was led by Rashad al-Alimi who maintains close ties both with Riyadh, and with major Yemeni party, the Islamist Islah.

The United Arab Emirates has backed several factions in the creation of this new body, including Aidarous, al-Zubaidi from the separatist Southern Transitional Council. This group distrusts Islah but fought Hadi’s government to control Aden.

This is a desperate attempt to reestablish unity in the anti-Houthi coalition. “The problem is that many individuals have opposing viewpoints and it’s not clear how they can collaborate,” Gregory Johnsen said via Twitter (NYSE:).

The Houthis resent Ali Mohsen al-Ahmar as Vice President, a discredited Islamist-leaning General, for their military campaigns in northern Stronghold, and some southerners because of his involvement in the 1994 North-South Civil War.

Maamr Kabody from Sanaa told Reuters he hoped for peace and cooperation in the new Sanaa council. But we’ll wait and watch.

ECONOMIC AID

Tens of thousands died, the economy was devastated and Yemen is on the verge of starvation. Protests erupted after the central bank was split into two rival agencies and the devaluation of the riyal in government-held southern has led to the dissolution of the central bank.

Saudi Arabia, UAE and UAE each will inject $1 million into Yemen’s Central Bank. The kingdom will also grant $1 billion for oil derivatives development and maintenance.

Riyadh, the last to deposit funds in the central bank’s vault in 2018, said that it would also give $300 million towards the U.N. relief response. In March, less than one-third of the $4.27 trillion sought, however.

The United Nations pushes for economic stabilization and inclusive political negotiation.

It is often viewed as an act of proxy warfare between Iran and Saudi Arabia. Houthis claim they fight a corrupt system, and foreign aggression.