It was one of Joe Biden’s first major foreign policy decisions.

Less than a month after taking office in January 2021, the United States president lifted two “terrorist” designations imposed by his predecessor, Donald Trump, against Yemen’s Houthi rebels.

At the time, Secretary of State Antony Blinken said the move came in “recognition of the dire humanitarian situation in Yemen”. The United Nations, as well as humanitarian groups and US lawmakers, had warned the “terrorist” designations could interrupt the flow of aid to the country.

Now, almost exactly three years later, the Biden administration is reimposing one of the designations against the Houthis, declaring them to be a “Specially Designated Global Terrorist group” amid a series of attacks in the Red Sea.

And once again, rights advocates and political analysts are sounding the alarm over the negative effects the decision may have on Yemeni civilians. Many also question whether Wednesday’s designation will succeed in pushing the Houthis to end their attacks.

“I’m very concerned about the devastating consequences for ordinary people in Yemen,” said Afrah Nasser, a non-resident fellow at the Arab Center Washington DC who previously worked as a Yemen researcher at Human Rights Watch.

Nasser told Al Jazeera that the designation risks deepening the humanitarian crisis in Yemen, which has experienced a years-long war between the Houthis and a coalition led by Saudi Arabia and the United Arab Emirates.

More than half of the Yemeni population — 18.2 million people — is in need of assistance, according to the UN, as the country reels from an economic crisis, rising costs, mass displacement and hunger.

“The ordinary Yemeni family today is suffering because of both the Houthi domestic policies and also the international community policies in Yemen, such as this [US] designation that we heard today,” Nasser said. “Yemenis are caught between two fires.”

Red Sea attacks

In a statement on Wednesday morning, Blinken said the “Specially Designated Global Terrorist group” designation (SDGT) came in response to Houthi attacks on commercial vessels in the Red Sea.

“This designation seeks to promote accountability for the group’s terrorist activities. If the Houthis cease their attacks in the Red Sea and Gulf of Aden, the United States will reevaluate this designation,” the top US diplomat said.

The Iran-aligned Houthis, who control large swaths of Yemen, began firing missiles at Israel and attacking commercial ships in the Red Sea shortly after the war in Gaza began in October.

The group pledged to target Israel-linked vessels as part of an effort to pressure the country’s government to end its Gaza bombardment and allow more humanitarian aid deliveries into the coastal Palestinian enclave. It later expanded the threat to any commercial vessels travelling to and from Israel along the arterial trade route off Yemen’s coast.

The attacks led shipping companies to suspend operations in the Red Sea and drew condemnation from the US and its allies.

Washington launched a naval coalition to protect commercial vessels in December, and it also carried out several strikes against Houthi targets in Yemen this month in what observers called a “dangerous” escalation.

On Wednesday, the Biden administration defended its decision to reimpose the SDGT designation on the Houthis, saying there would be “carve-outs” to protect aid to Yemen.

“Today’s designation targets the Houthis, not the Yemeni people,” National Security Council spokesperson John Kirby said in a press conference.

When asked about how any related sanctions would impact negotiations with the Houthis, Kirby responded firmly: “There’s no negotiations. There’s not a bargaining chip. It’s a way of holding the Houthis accountable.”

But experts cast doubt on whether the SDGT designation would lead the Houthis to stop their attacks in the Red Sea, as the administration suggested.

“It seems highly unlikely to have any positive effect on the behaviour of the Houthis,” said Brian Finucane, a senior US programme adviser at the International Crisis Group think tank.

“I think it’s a form of do-something-ism,” he told Al Jazeera. The reimposition of the SDGT designation, he added, is a reflection of Washington’s refusal to recognise that recent Houthi attacks are linked to the war in Gaza.

“The Biden administration has put itself in a box … where it doesn’t have good policy options.”

The designation

An SDGT designation focuses primarily on the finances of an individual or a group. In this case, it will freeze the Houthis’ assets in the US and prohibit American citizens from having any financial dealings with the organisation.

And while “civil and criminal penalties may be assessed for violations”, the designation is more narrow in scope than the second label that the Trump administration had imposed on the Houthis: that of “Foreign Terrorist Organization” or FTO.

That label makes it a serious crime to provide support to a blacklisted group.

“This [SDGT designation] is sort of a minimal: restricting access to funds from abroad, access to international markets. These are things that Houthis don’t have and never had. They don’t own stock on the New York Stock Exchange,” said Nabeel Khoury, a former deputy chief of mission at the US embassy in Yemen.

Nevertheless, Khoury told Al Jazeera that the Houthis are unlikely to make a distinction between an SDGT or FTO designation and will see Wednesday’s decision as an affront that could lead to further escalation.

Hours after the designation was announced, the Houthis said they fired “naval missiles” at an American ship in the Gulf of Aden. US Central Command later confirmed the US-owned and operated Genco Picardy was struck, causing some damage but no injuries.

“It’s really baffling what this administration is engaged in. I don’t think there’s much thought that went into this,” Khoury said. “This designation is more like an insult. It’s the old glove in the face, slap someone with your glove. You’re sort of challenging, but not really hurting them.”

Nasser also warned that the designation could further embolden the Houthis and “contribute in radicalising some parts of the population and strengthen the Houthi recruitment system”.

‘Level of uncertainty for Yemenis’

Yet, while the SDGT designation is “narrower” than an FTO, the Biden administration is aware “that these sanctions could make things worse for the people of Yemen”, said Finucane.

That’s because financial institutions and humanitarian organisations “are likely to be very cautious about engaging with the Houthis in Yemen”, particularly until clear rules around the redesignation are laid out, Finucane explained.

On Wednesday, the Biden administration said it is “taking significant steps to mitigate any adverse impacts this designation may have on the people of Yemen”. The decision will come into effect in 30 days, Blinken’s statement said, during which time the administration will consult with aid organisations and other stakeholders.

The US Department of Treasury also is expected to publish licenses “authorizing certain transactions related to the provision of food, medicine, and fuel, as well as personal remittances, telecommunications and mail, and port and airport operations on which the Yemeni people rely”.

An SDGT designation is doing something to do something. Like an FTO designation, it’s toothless and won’t have any desired effect. Where the FTO would have ushered in a certain catastrophe, an SDGT carries only a severe risk of catastrophe.

— Scott Paul (@ScottTPaul) January 16, 2024

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But that hasn’t dampened fears the designation will affect Yemenis negatively.

“This designation would add another level of uncertainty and threat for Yemenis still caught in one of the world’s largest humanitarian crises,” Scott Paul, associate director of peace and security at Oxfam America, told Al Jazeera in a written statement.

“The Biden administration is playing with fire, and we call on them to avoid this designation immediately and prioritise the lives of Yemenis now.”

With files from Al Jazeera’s Ali Harb in Washington, DC.