Yemeni separatists abandoned their declaration of self-rule in the south on Wednesday (July 29th) and pledged to implement a Saudi-brokered peace deal, mending a rift between allies in the war against the Houthis (Ansarallah).
The Southern Transitional Council (STC) proclaimed self-governance in April after accusing the government of failing to perform its duties and of "conspiring" against the southern cause, pushing the country deeper into crisis.
The breakdown had complicated the ongoing conflict between the Yemeni government, backed by the Arab coalition, and the Iran-backed Houthis, who control much of the north, including Sanaa.
The STC "announces that it is abandoning its self-rule declaration" to allow the implementation of a power-sharing deal known as the Riyadh Agreement, spokesman Nizar Haitham said in a social media post.
He acknowledged the announcement came after Saudi Arabia and the UAE exerted pressure to row back on their decision.
Saudi Arabia said it had proposed a plan to "accelerate" the implementation of the Riyadh Agreement, the Saudi Press Agency (SPA) reported Wednesday.
The plan calls for the Yemeni prime minister to form a new government within 30 days, as well as the appointment of a new governor and security director for Aden, where the government had set up base.
"Once this is implemented, the government should commence its work in Aden, and oversee the completion of the implementation of the Riyadh Agreement in accordance with all its clauses and tracks," SPA said, citing a Saudi official.
The Yemeni government welcomed the announcement, with spokesman Rajeh Badi expressing hope that this would be a "serious and true start" to implementing the Riyadh Agreement.
Yemeni President Abd Rabbu Mansour Hadi, exiled in Riyadh, instructed Prime Minister Moeen Abdulmalik to form a new cabinet and announced the appointment of a new police commander and governor for Aden.
If it holds, the breakthrough should allow the Arab coalition and its allies to refocus their energies on the war against their common foe -- the Iran-backed Houthis.
"This largely means the Saudis want to de-escalate in Yemen and push the warring parties towards peace," said Fatima Abo Alasrar, a scholar at the Middle East Institute.
"Currently, without a united response, the Saudis, the Yemeni government and the STC are on the defensive in the war, not offensive, because the Houthis are attacking their areas with impunity," he said.
The breakthrough, after months of impasse, shows the "possibility of resolving Yemeni differences through dialogue without the use military force", deputy defence minister Prince Khalid bin Salman said in a social media post.
Saudi Foreign Minister Prince Faisal bin Farhan hailed the development as a "positive step", saying it will strengthen trust between the allies and allow the government to resume its work in Aden.