The decision may lead to more Houthi escalation, whether in Yemen or the Red Sea, or it may serve as a pressure tactic to push the group to deliver several concessions.

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Mohammad Fawzy (South24 Center)

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On January 22, 2025, the White House issued an Executive Order to re-designate the Houthis as a ’Foreign Terrorist Organization‘ (FTO). In a statement, it said: “The Houthis' activities threaten the security of American civilians and personnel in the Middle East, the safety of our closest regional partners, and the stability of global maritime trade.” In general, Trump’s executive order is more severe than Biden’s reclassification of the Houthis as a ’Specially Designated Global Terrorist‘ (SDGT) entity, in January 2024. It is the most stringent US designation of FTO. Its importance is related to several considerations, the first of which is that it reflects the approach that will be adopted by the Trump administration toward the Houthis. The second is that this move will have an impact at the level of the peace process in Yemen as well as the economics and the external relationships of the Houthis. It will of course have consequences at the security and military levels. This paper seeks to analyze the dimensions and repercussions of the new executive order.

First-The Indications of the Houthi’s New Designation

The Trump administration’s order, that will come into effect within 30 days after being ratified by the US Secretary of State and some departments, has several important indications as illustrated below:

1- The Most Severe Designation: The Biden administration re-designated the Houthis as a ’Specially Designated Global Terrorist‘ entity on January 17, 2024, pursuant to Executive Order No. 13224 which, according to the US laws, “imposes firm sanctions against foreigners who committed terrorist acts threatening the security of Americans or the Foreign policy or the economy of the United States or pose a big threat of doing similar acts”. This decision was seen at that time as an attempt to pressure the Houthis to halt their attacks on ships in the Red Sea. However, Trump’s executive order is different in terms of nature and consequences. It is more severe than Biden’s as it includes freezing of assets and banning transactions. It is like an economic embargo since it imposes strong sanctions against violators. In other words, the re-designation of the Houthis as FTO criminalizes all types of financial or personal transactions with them or even providing technical expertise, training, and aid that may include contacting the group or any of its affiliates. More precisely, this is the gold standard of US terrorism sanctions, which places the Houthis on equal footing with the ISIS and Al-Qaeda from the perspective of the new US administration.

2- A Strict Strategy Toward the Houthis: One of the dimensions of this decision is that it reveals the potential approach of the Trump administration toward the Houthis. This strategy is based on a number of key pillars, the first of which is that the new US administration will adopt the “maximum pressure” policy toward the Houthis. The second is that this will be followed by more escalatory measures by the Trump administration in a way that ensures imposing further pressure and blockades against the Houthis. Thirdly, the new US administration sends a message to its predecessor about its failure in dealing with the Houthis. Fourthly, this strategy means a zero tolerance approach toward any files related to the Houthis under the pretext of humanitarian considerations.

3- Identification With the Israeli Pressure: Through his ’X‘ account, Israeli Foreign Minister Gideon Saar welcomed the US re-designation of the Houthis as an FTO. He said: “The Houthis are an Iranian proxy that disrupts freedom of navigation, threatens global trade and destabilizes regional stability and the global order. This is an important step in fighting terror and combating the destabilizing elements in our region.”

In general, the US executive order isn’t limited to the view adopted by the Trump administration toward the Houthis but it is also linked to the Israeli pressure and the ramifications of the latest escalation in the region at several levels. The executive order is a form of response and an approach to deal with the Houthi threats in the Red Sea and to maritime navigation, in addition to their repeated targeting of the Israeli depth. Furthermore, the Trump administration includes pro-Israeli figures such as National Security Advisor Michael Waltz, Secretary of Defense Pete Hegseth, the new US Ambassador to Israel Mike Huckabee and others. Thus, the Israeli factor has strongly contributed to taking this decision.

Secondly-The Potential Implications of the Decision

The re-designation is a strong blow to the Houthis at all levels. It will lead to several implications as shown below:

1- Delegitimizing the Houthis: Pursuant to this decision, the Houthis have become an FTO similarly to the Al-Qaeda and ISIS. This will have several consequences, the first of which is delegitimizing the Houthis in a way that will deprive them of participating in any future Yemeni government based on subsequent peace deals. The second one is that this decision will add more difficulties in the path of negotiations with the Houthis, imposing legal obstacles that hinder the work of peace mediators. For example, with the restrictions on material support imposed by the decision, providing the negotiators with any facilities or services such as transport and housing will become difficult and require special arrangements. This is in addition to concerns regarding negotiating or engaging in talks with a group designated as a terrorist organization. The third is that this decision is considered a victory for the legitimacy camp in Yemen, increasing its political weight and negotiation position. This has been evident in how this camp welcomed the decision. The fourth one is that the re-designation of the Houthis closes the door to any politics, dialogue, and negotiations with the group and brings to the surface the “maximum economic strangulation” policies against the group.

2- Humanitarian and Economic Ramifications: On the sidelines of his latest decision, President Trump said that he will instruct the US Agency For International Development (USAID) to cut its relationship with the entities that provided payment to the Houthis. As part of the repercussions of the order, the United Nations announced the suspension of all its movements and operations in Houthi-controlled areas, a move that reflects the mounting threats facing employees of humanitarian organizations there. In light of estimates that 80% of the Yemeni people depend on humanitarian aid to survive, this decision is likely to exacerbate the humanitarian conditions in the areas controlled by the Houthis. Moreover, it will impact financial transfers to the Houthi areas by depriving the banks operating in Sanaa of the ’SWIFT‘ system. Furthermore, the decision will negatively impact the group’s financial resources regarding customs revenues in the Port of Hodeidah and Ras Issa.

3- The Possible Expansion of the US Attacks against the Houthis: Based on the order, the Houthis are labelled as a most dangerous terrorist organization like the Al-Qaeda and ISIS. Accordingly, the new US administration may not be satisfied with the operations launched against Houthi-controlled areas through the ’Prosperity Guardian‘ maritime security coalition or its coordination with the UK regarding the forces deployed in the Middle East. The Trump administration may resort to the “beheading” approach that focuses on hunting down and assassinating the leaders of terrorist organizations. This approach has been adopted by the US in countries like Iraq, Syria, and Somalia.

4- The Implications of the Escalation in the Red Sea: Most analyses and estimates suggest that the decision will add more pressure on the Houthis to make them reduce their escalation in the Red Sea, especially since it coincided with the Houthi announcement of decreasing their maritime attacks and releasing the crew of commercial ship ’Galaxy Leader’ after more than a year in captivity. However, there is another explanation that suggests that the US decision will push the Houthis toward additional escalation. This hypothesis is based on some main considerations, the first of which is that the group may respond to the decision by moving to prevent any British or American vessels from passing through the Red Sea and the Bab Al-Mandab. The second is that it may push Israel to expand the area and scale of its strikes against the Houthis in Yemen.

5- The Limited Impact on the Houthi Military Capabilities: The US decision will have a major negative economic impact and implications on the Houthis. Nonetheless, it is unlikely to largely impact their military capabilities for several reasons. The first is that even if the United States resorts to adopting qualitative operations against the group, the targeting of the leaders of Hezbollah and Hamas last year has pushed the Houthis to enhance the security of their commanders. The second one is that Israel, according to some estimates, lacks strong intelligence sources in Yemen and among the Houthis, like what it has in Gaza and Lebanon. The third reason is that the Houthi militia mainly depends on Iran-made smuggled weapons. They also rely on imposing levies and taxes locally in the areas under their control as a funding source to purchase weapons, along with their ties with several armed organizations and militias. 

Finally, it can be said that the re-designation of the Houthis as a first-class FTO reflects the special approach of the Trump administration toward the religious group and is considered one form of using the “maximum pressure” policy. In general, the decision may lead to more Houthi escalation, whether in Yemen or the Red Sea, or it may serve as a pressure tactic to push the group to deliver several concessions, especially regarding the settlement file in Yemen and the Red Sea.