Sanaa, Jul 23 (IANS): The Yemeni government and the Houthi group agreed to end the banking dispute and resume flights from Houthi-held capital Sanaa, in a deal mediated by Saudi Arabia, the UN envoy for Yemen said in a statement on Tuesday.

The Yemeni government and the Houthi group informed a day earlier the Special Envoy of the Secretary-General for Yemen, Hans Grundberg, that they agreed to de-escalate on these matters, said the statement, adding Grundberg appreciated the Saudi facilitating role in the deal.

The two sides agreed on "canceling all the recent decisions and procedures against banks by both sides, resuming Yemenia Airways' flights between Sanaa and Jordan and increasing the number of flights to three daily flights, and operating flights to Cairo and India daily or as needed," it noted.

"Grundberg stressed the need for the parties to collaborate towards an economy that benefits all Yemenis and supports the implementation of a nationwide ceasefire and the resumption of an inclusive political process," it added, Xinhua news agency reported.

Houthi top negotiator Mohammed Abdulsalam confirmed the deal, considering it as a significant breakthrough, Houthi-run al-Masirah TV reported.

Last month, the Yemeni government withdrew its license and stopped operations of six banks in the Houthi-held Sanaa after they refused to relocate to Aden, Yemen's temporary capital.

It also suspended flights from and to Sanaa airport after the Houthi group seized three passenger planes of Yemenia Airways, the natural carrier of Yemen, to press the government to increase the number of flights from Sanaa to Jordan.

Yemen has been mired in a civil war since late 2014, when the Houthis seized control of much of northern Yemen, forcing the internationally recognized government out of the capital Sanaa.