Yemen’s Houthi rebels have vowed to continue fighting but say the year ahead may present an opportunity for change.
Tension escalated this week between members of the Presidential Leadership Council (PLC) as Saudi Arabia struck armoured vehicles in the southern port of Mukalla. It was followed by the UAE announcing the withdrawal of all its remaining counter-terrorism teams from the country.
Experts said divisions within Yemen’s ruling council have not only put the future of the governing body at risk, but have also opened the door for others to gain, including the Houthis and other extremist groups.
“The end of the coalition and Saudi Arabia remaining alone at the forefront is a notable development that marked the end of the past year,” claimed Houthi senior official Mohammed Abdul Salam in a post on X.
“It has confirmed the failure of betting on the continuation of aggression and the blockade, which will only result in further losses. For those who reflect and understand, the new year presents an opportunity to address the various files arising from the Saudi-American aggression Yemen has faced in recent years,” he added.
Saudi Arabia has led the anti-Houthi alliance since 2015, with the UAE playing a key role in halting the advance of the Iran-backed rebels, expelling them from the south and combating extremist groups such as Al Qaeda and ISIS.
The Southern Transitional Council (STC), which seeks the restoration of an independent southern state, recently took control of Hadhramaut and Mahra from other pro-government forces, effectively consolidating its grip over all southern governorates.
The group said the move followed what it described as the failure of other pro-government factions to launch a serious campaign against the Houthis in their northern strongholds, including the capital Sanaa.
Saudi Arabia, which hosts senior Yemeni government and PLC figures, condemned the STC’s takeover.
On Friday, the Saudi Ambassador to Yemen, Mohammed bin Saeed Al Jaber, said the kingdom had spent weeks working with the STC to defuse tension and secure the withdrawal of its forces from camps outside Hadhramaut and Mahra.
He added that these efforts were repeatedly "rebuffed" by STC leader Aidarous Al Zubaidi, most recently through his refusal to approve a permit for a Saudi aircraft carrying an official delegation to Aden on January 1, 2026.
Mr Al Jaber accused Mr Al Zubaidi of ordering the closure of Aden International Airport, while expressing hope that more “pragmatic voices” within the STC would prevail. The STC denied ordering the closure of the airport.
Southern forces played a significant role in driving Houthi fighters out of southern Yemen, particularly in Aden, Lahj and parts of Abyan, during the early years of the war between 2015 and 2018.
Those battles prevented the Houthis from consolidating control over the south after their advance from Sanaa and allowed the internationally recognised government to re-establish a foothold in Aden. The STC later emerged as a political umbrella for many of the southern forces involved in those campaigns.
“After a year filled with many challenges and sacrifices, there are further challenges and opportunities that the nation must confront,” wrote Mr Abdul Salam.
The Houthi official added that the rebels “have not forgotten their internal struggle and the obligations,” warning that “the blockade … represents a major obstacle to any efforts seeking humanitarian or political solutions to the overall situation.”
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Expo details
Expo 2020 Dubai will be the first World Expo to be held in the Middle East, Africa and South Asia
The world fair will run for six months from October 20, 2020 to April 10, 2021.
It is expected to attract 25 million visits
Some 70 per cent visitors are projected to come from outside the UAE, the largest proportion of international visitors in the 167-year history of World Expos.
More than 30,000 volunteers are required for Expo 2020
The site covers a total of 4.38 sqkm, including a 2 sqkm gated area
It is located adjacent to Al Maktoum International Airport in Dubai South
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Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer