By Zakaria al-Kamaali

ADEN, Yemen 

Yemeni President Abd Rabbuh Mansour Hadi on Sunday sacked the governor of the country’s central bank and ordered that the institution be relocated from capital Sanaa to Aden.

In a decree, Hadi appointed his finance minister, Munser al-Quaiti, as new central bank governor, replacing Mohamed Awad bin Hammam, according to Yemen’s official SABA news agency.

He also reshuffled the bank’s board of directors.

The Yemeni leader also ordered that the bank be relocated from Sanaa -- which since late 2014 has been held by the Shia Houthi militia and its allies -- to the southern port city of Aden, the provisional seat of Hadi’s embattled government.

The move comes amid an ongoing dispute between Hadi’s government and the Shia group over state finances.

The government accuses the Houthis of exhausting Yemen’s foreign reserves, which have plummeted from $4 billion in early 2015 to a current $1.1 billion.

"This is one of the gravest economic decisions to be taken within the past two years," economist Mustafa Nasr told Anadolu Agency.

The decision, he said, "will have major repercussions in the upcoming period".

Nasr pinned the move’s success on the government’s ability -- and that of Yemen’s Arab Gulf allies -- to adequately resolve the country’s ongoing economic crisis.

"It will also depend on [the government’s ability to] maintain security and political stability in Aden, mobilize resources, and promote trade and economic activity," he said.

Maged al-Mazhaji, for his part, director of the Sanaa Center for Strategic Studies, a Yemeni think tank, described the bank’s relocation as "catastrophic".

"It will undermine the stability of Yemen’s financial system and make it hostage to the conflict," he said.

Yemen has been racked by chaos since late 2014, when the Houthis and their allies overran Sanaa and other parts of the country, forcing Hadi and his Saudi-backed government to temporarily flee to Riyadh.

The conflict escalated in March of last year when Saudi Arabia and its Arab allies launched a massive air campaign in Yemen aimed at reversing Houthi military gains and restoring Hadi’s government.