The new grant will be given through the Saudi Development and Reconstruction Program for Yemen with the aim of supporting the government’s budget, the source said.

The administration in Aden has grappled with a weak currency and high prices since the Houthis ousted former Yemeni President Ali Abdullah Saleh from the capital Sanaa in late 2014, triggering a decade-long civil war.

A Saudi-led military coalition intervened in Yemen in March 2015 to reinstate its exiled government, and Yemen has since then been split between the internationally recognised government in Aden and a Houthi administration in Sanaa.

Riyadh has provided billions of dollars in aid and deposits to support the government in Aden, helping to shore up its finances and pay public sector salaries.