The United States must cancel its decision to classify Yemen's Houthi rebels as "terrorists" to avoid the risk of a famine not seen for decades, a senior United Nations official has told the Security Council.

"What is the likely humanitarian impact? The answer is a large-scale famine on a scale that we have not seen for nearly 40 years," said Mark Lowcock, the UN undersecretary-general for humanitarian affairs.

He said exemptions to allow aid agencies to deliver supplies, as suggested by Washington, would not be sufficient to avoid a famine, adding "what would prevent it? A reversal of the decision."

The terrorist classification has drawn criticism from aid groups over fears it will exacerbate the already dire humanitarian crisis in war-ravaged Yemen.

Outgoing US President Donald Trump's administration announced the last-ditch move on Sunday with just days to go before his successor Joe Biden takes over.

The designation is set to come into force on 19 January - the eve of the inauguration of Mr Biden, whose aides had hoped to mount a fresh push to end Yemen's six-year war. 

It has also been seen as complicating the incoming US leader's promised efforts to restart diplomacy with Iran, which has links to the Houthis.

The rebels control much of Yemen and have faced a bloody offensive from US ally Saudi Arabia, with millions in the country depending on relief to survive.

A designation as a terrorist group is expected to halt many transactions with Houthi authorities, including bank transfers and for food and fuel, due to fears of US prosecution.


EU criticises US labelling Yemen rebels 'terrorists'


Aid groups have said that they have no option but to deal with what is the de facto government in northern Yemen. 

The UN envoy for Yemen, Martin Griffiths, said he backed Lowcock's stance that the US decision "would contribute to famine in Yemen and thus should be revoked."

"We fear that there will be inevitably a chilling effect on my efforts to bring the parties together," added Griffiths, who has regular contact with the Huthis.

It was the first time that the UN, usually cautious with its largest financial contributor, has so clearly criticized the outgoing US administration.

About 16 million people will go hungry this year in Yemen, the UN predicts.

David Beasley, head of the World Food Program, discarded his prepared speech to warn of a "catastrophic" famine.

"What do you think is going to happen to five million people that are in emergency classification now? They are going to slide into famine conditions," he said.

"We are struggling now with a designation (which) is going to be catastrophic. It literally going to be a death sentence to hundreds of thousands if not millions of innocent people."

Deputy US Ambassador to the UN Richard Mills pointed out that the US was the largest humanitarian aid donor and offered assurances that exemptions would limit the impact of the American decision.