- Nada Choueiri, Klaus-Stefan Enders, Yuri Sobolev, Jan Walliser, and Sherwyn Williams
- Published Date:
- May 2002
The tourism sector is widely seen as a potential source of growth in the non-oil sector. It is also widely recognized that a number of structural impediments— such as security concerns, first and foremost, and lack of infrastructure— constrain this potential and would need to be fundamentally addressed before the tourism industry could start making a major contribution to future economic growth and employment.
Yemen has abundant tourism resources and potential for further growth and development. Yemen’s long history, reflected in its rich and unique culture, has left a wealth of significant archaeological sites and a unique vernacular architecture. Yemen has a mixture of scenery—ranging from desert through verdant valleys to mountain ranges—some 2,000 kilometers of coastline, fringing the Red Sea and the Gulf of Aden, and more than hundred islands. Finally, after centuries of isolation from the rest of the world, Yemen remains one of the last unknown destinations.
In addition to the traditional tourism potential of its existing historic and scenic attractions, Yemen has significant opportunities for the development of other forms of tourism that are still largely unknown there, but which possess increasing market potential. These include trekking and mountain hiking, mountain biking, beach resort tourism, scuba diving, and eco-tourism, both terrestrial and marine.
Size and Trends
In general, since unification in 1990, international tourism in Yemen has been on an upward, trend, with visitor arrivals growing on average by about 5 percent a year (Table 17 and Figure 24). The tourism sector suffered major setbacks in 1991, after the Gulf crisis erupted; in 1994, the year of the civil war in Yemen; and in 1999. after a fatal kidnapping incident in December 1998.
|Visitor arrivals, thousands||51.8||27.3||72.2||69.8||39.9||61.4||74.5||80.5||87.6||57.8|
|Revenue, US$ million||40.0||21.0||46.9||54.0||35.0||50.0||55.0||69.0||84.0||48.4|
Figure 24.Visitor Arrivals
Source: Data provided by the Yemeni authorities.
Yemen’s principal tourism source market is Western Europe (Table 18), in particular, Germany, France, Italy, and Britain, which to a large extent reflects the contacts established by the existing tour operators. The peak tourist season in Yemen is between October and March. International tourism is mainly concentrated in the governorates of Sana’a, Hadhra-mout, Al-Jouf, Al-Hodeidah, Marib, and Shabwa.
|(Of which: By Region)|
In 1998, the tourism sector provided jobs, either directly or indirectly, to an estimated 23,000 workers, including those in the hotel industry and related sectors. As tourism extends to remote regions, it helps provide employment opportunities and increases incomes among the local population. Total foreign exchange revenues from tourism are still relatively small—at about 3 percent of total exports of goods and services, or 18 percent or non-oil exports in recent years—but have been growing on average by 8 percent a year.
The Yemeni government believes that developing tourism will help enhance long-term economic growth and improve the living standards of the Yemeni people, as well as protect and preserve Yemen’s cultural heritage and natural environment.
Concerns over peace and security, and inadequate infrastructure, are the two largest immediate obstacles to the successful development of the tourism industry in Yemen, while the danger of losing the historic and cultural heritage and environmental degradation are longer-term problems.
At present, the image of Yemen in the Western world is relatively poor and, prompted by continuous security-related incidents, the country is often characterized in the Western media as “kidnapping and bombing prone.”93
Although Yemen was unified in 1990, civil unrest lasted and a 70-day civil war erupted in 1994. There are areas, especially in the North, which are still not under the full control of the central government. Reportedly, there are large numbers of Firearms in the country, almost four per head.94 Illicit weapons, including assault rifles, are openly carried. Politically motivated violence persists and security violations occasionally occur in rural areas.95 Tribal disputes, kidnappings, and shootouts between sheikhs’ armed entourages and government security forces are frequent, including in major cities and public places such as Sana’a International Airport.
More than 100 kidnappings have occurred throughout Yemen since 1991, mainly conducted by armed tribesmen with specific grievances against the government.96 These kidnappings are normally resolved peacefully, but tribesmen have held some foreigners for extended periods, and the December 1998 incident—when four tourists were executed by a group of Islamic militants—gave Yemen front page international news coverage and dealt a severe blow to the nascent tourism industry.
Since then, many countries, including the United States, the United Kingdom, and Japan, have advised their nationals against traveling to Yemen;97 Germany has reduced the number of accredited Yemeni tourist agencies to two; and KLM Airlines has suspended its service to Yemen.98
Addressing security concerns is necessary, but not enough for the successful development of the tourism sector in Yemen. The lack of adequate infrastructure—such as hotels, roads, catering, and airport services— is another major factor constraining the growth of the tourism sector.
Only a third of roads in Yemen are paved. Poor roads and lack of easy access to tourist attractions entail long and uncomfortable journeys by four-wheel drive vehicles, which means that visits to places of interest have to be of relatively short duration.
Existing hotel stock is heavily concentrated in the urban areas of Sana’a, Aden, Hadhramout, and Taiz, with more than 50 percent of first class rooms located in Sana’a. Despite a significant increase in hotel construction since unification, the number of hotel rooms suitable for international tourists who prefer to stay in high-grade properties has remained unchanged and is currently only about 1,100, or less than 15 percent of the total room stock.99 Consequently, tour operators have reported problems getting enough rooms of a suitable standard during the high season and have often had to reject big tour group reservations because of accommodation and transportation constraints.100
The development of tourism is also constrained by the absence of basic services—such as eating and toilet facilities—and a shortage of potable water both at places of interest and at possible stopover points. Furthermore, there are no tourist information or interpretation centers outside Sana’a, while those available in Sana’a are not up to international standards, lacking appropriately trained or licensed tour guides.
The situation is compounded by the shortage of trained and experienced local personnel and the absence of facilities providing professional training in the services sector. As a result, expatriates often have to be hired, especially in the hotel industry, thus further hindering the development of a local tourism sector.
Finally, airport facilities have limited baggage and passenger handling capacity, partly reflecting Yemenia’s monopoly in this area, and could become congested if more than one aircraft is being served.
Threat to Historic Heritage and Natural Environment
At present, regulations to prevent the destruction of buildings of historic and cultural significance or protect the natural environment are limited and poorly enforced. As a result, there is a real threat to the historic heritage of Yemen, the very feature that constitutes the principal tourist attraction. According to anecdotal evidence, some 30 percent of “physical” heritage in the countryside has been lost in the past 10 years to unregulated commercial development, and parts of the coastline with significant beach resort potential are being lost to industrial development.101 Furthermore, the potential for eco-tourism, especially in the coastal areas, is being destroyed as various species—such as sea turtles—are driven to extinction because of poor enforcement of seasonal hunting and fishing restrictions.
Given the undoubted potential of tourism in Yemen, the foregoing discussion suggests that the following are critical to the successful development of the tourism sector in Yemen:
Guaranteeing of security and maintaining a stable political and economic environment as preconditions for investment, both domestic and foreign, in the tourism sector, given the long-term, and hence high-risk, nature of such investment;
Investing in essential infrastructure and tourism-related services and facilities;
Providing training and licensing for both public and private sector tourism personnel to ensure that tourists receive a standard of service consistent with internationally accepted norms; and
Protecting and conserving the historic and cultural heritage and natural environment of the country.
The formation of a public sector institutional structure, with well-defined functional responsibilities that would readily facilitate planning, development, marketing, and regulation, is critical to the attainment of policy objectives for the tourism sector in Yemen. This would require structural changes and training initiatives in order to make the public sector more effective in carrying out its statutory functions, and would include collaboration with the private sector.
Government Efforts to Date
After the kidnapping incident in December 1998, the government stepped up its effort to address the security problem and shore up the tourism industry. Special courts were set up to try kidnappers, and the death penalty was introduced for the offence.102 Weapons were banned in the capital, and a Special Forces unit was formed in November 1999 to combat terrorism.
A new Tourism Law was issued in August 1999, and three new government entities were established—the Tourism Promotion Board, the High Council on Tourism, and the Environmental Council—in addition to the existing government structures in charge of tourism affairs, such as the Ministry of Tourism and Culture and the General Tourism Authority.103
The Tourism Promotion Board was set up under the umbrella of the Ministry of Tourism and Culture and consists of representatives of the government, the private sector, and the media. It is charged with improving the image of Yemen in the Western media as well as increasing the general awareness abroad and at home of tourism in Yemen. It is chaired by the Minister of Tourism and holds weekly meetings to discuss the sector’s promotion and development strategy, hut has no decision-making authority. In addition, the Board has undertaken to study the experience of Egypt in limiting the fall-out from terrorism on the tourism industry.
The High Council on Tourism is chaired by the Prime Minister and comprises seven other ministers, including the Ministers of Tourism, Information, Industry, Planning, Interior, and Defense. It meets to discuss key policy, investment, and security issues in the area of tourism and has decision-making powers.
The authorities, led in their efforts by the General Tourism Authority, have recently been actively seeking technical assistance and external Financing for project implementation, including updating the Master Plan for Tourism Development in Yemen which was sponsored in 1991 by the European Community.
|Tax||Nature of Tax||Exemptions and Deductions||Rates|
|1. Taxes on business income|
|1.1 Domestic corporations||Levied on net profits. Assessment base encompasses most forms of income, including interest, dividends, and foreign income||Deductions: Operating costs; depreciation allowance; charitable contributions up to 5 percent of net in come; and Zakat.|
Exemptions: Income of cooperatives, and agricultural and humanitarian societies, provided trade is limited to members; and income from agriculture, livestock, poultry, fishing, and beekeeping, subject to regulations. Corporations may be granted an exemption if they qualify under the Investment Law (IL); this entails a five-year exemption, but Council of Ministers may grant an additional five years
|35 percent flat rate Penalties are levied for late payment|
|1.2 Foreign corporations||Same as above||Same as above||35 percent flat rate|
|1.3 Proprietorships||Same as above||Deductions: Same as above Exemption: YR1s 36,000||Personal tax rates, 10 percent-35 percent|
|2. Taxes on personal income|
|2.1 Tax on wages and salaries||Levied on total wage income (wages, salaries, bonuses, etc.,) including gratuities in cash or kind.|
Monthly withholding by the employer from wages of both residents and nonresidents and paid to tax authorities during the first 10 days of the following month. Companies with eight or more workers must keep tax records for their employees
|Deductions: Pension contributions, and work-related costs|
Exemptions: Monthly exemption: YR1s 3,000. Exemption not granted for nonresidents
Fully exempted: diplomats: UN experts; pension and severance payments; wages paid to Yemeni agricultural and fishing workers: domestic servants; and income of day laborers
|Personal tax rates with a ceiling of 20 percent.|
|2.2 Tax on professional income||Levied on noncommercial and nonindustrial income.||Deductions: Costs deducted according to specified list||Personal tax rates, 10 percent 35 percent|
|3. Social security and retirement contributions|
|3.1 Civil service and public enterprise employees||Paid to General Authority for Insurance and Pensions (GAIP)||12 percent with equal contributions from employees and Government; Government also pays 1 percent for accident insurance.|
|3.2 Police employees||Paid to separate pension fund||12 percent with equal contributions from employees and Government|
|3.3 Defense employees||Paid to separate pension fund||12 percent with equal contributions from employees and Government|
|3.4 Private sector employees||Paid to separate pension fund||6 percent employee, 9 percent employer|
|4. Taxes on property|
|4.1 Real estate income tax||Levied on all net income from leased buildings and land||Exemptions: Government; religious organizations; local councils; diplomatic housing; and hospitals||One month’s rent (8.33 percent)|
|4.2 Real estate sales tax||Levied on sales proceeds From land and buildings||Deductions: None allowed. Exemptions: Transfers through inheritance; donations to religious or charitable organizations; religious organizations; and agricultural land||3 percent of sales value|
|5. Taxes on goods and services|
|5.1 General excise taxes||Harmonized taxes are levied on certain domestic and imported goods. The tax applies to the import costs (before the tariff) or at the domestic manufacturer level. For mineral water and soft drinks, tax applies to retail price paid by consumer||5, 7, 11, 15 percent, 25 percent applies to certain specified transportation vehicles and luxury items|
|5.2 Selected excise taxes||Items taxable at manufacture level|
|5.2.2 Tobacco||Levied on domestically produced and domestically trademarked or foreign trademarked cigarettes; imported tobacco, and tobacco products||For domestically produced cigarettes: 80 percent on domestically trade marked and 65 percent on foreign trademarked; 80 percent on imported cigarettes; 60 percent for cigars; 25 percent for imported tobacco|
|5.2.3 Taxes on petroleum products||Levied on retail sales price|
|5.3 Qat tax||Levied on assessed market value||25 percent|
|6. Customs tariff||Applied to all imports not specifically exempted||Exemptions may be provided to corporations that qualify under the IL||Four-band structure with rates of 5, 10, 15, and 30 percent, A single exemption of 70 percent applied to cigarettes and other tobacco products|
|7. Other taxes|
|7.1 Motor vehicle taxes||Levied on all motorized vehicles operating in Yemen with gasoline or diesel powered engines: levied on purchases of fuel (domestic or imported)||Exemptions: Government vehicles, diplomatic and embassy cars, and emergency vehicles.||YR1s 0.25 per liter of gasoline: YR1s 0.15 per litre of diesel|
|7.3 Counselor fees||For Yemeni visas||According to a specific schedule|
|7.4 Passport fee||Fee varies with the type of passport|
|7.5 Compulsory military service fee||Levied on Yemenis for exemption from or postponement of compulsory national military service||Yr1s 86,000 for exemption|
Nonrenewable Resources: A Case for Persistent Fiscal Surpluses,” IMF Working Paper 99/44 (Washington: International Monetary Fund).“
Arab Oil and Gas Directory, 1999 (Beirut: Arab Petroleum Research Center).
2000, “Oil Prices and the Terms of Trade,” Journal of International Economics, Vol. 50, pp. 185–213.
Fiscal-Policy Sustainability in Oil-Producing Countries,” IMF Working Paper 94/137 (Washington: International Monetary Fund).“
1989, “Oil Strike and Leadership Struggle in South Yemen: 1986 and Beyond,” Middle East Journal, Vol. 43, No. 3, pp. 437–454.
How Persistent are Shocks to World Commodity Prices?” IMF Working Paper 99/80 (Washington: International Monetary Fund).“
Fiscal Sustainability with Non-Renewable Resources,” IMF Working Paper 98/26 (Washington: International Monetary Fund).“
1993, “Homeward Bound: Yemeni Return Migration,” International Migration Review, Vol. 27 (Winter).
1997, “National Autonomy, Labor Migration and Political Crisis: Yemen and Saudi Arabia,” Middle East Journal, Vol. 51, No. 4, pp. 554–565.
1992, “The Unification of Yemen,” Middle East Journal, Vol. 46, No. 3, pp. 456—476.
1990, “The Economics of the Government Budget Constraint,” The World Bank Research Observer, Vol. 5, (July) No. 2, pp. 127–142.
2000, “Optimal Fiscal Strategy for Oil Exporting Countries: A User’s Manual,” Paper prepared for the MED Seminar Series (unpublished; Washington: Middle Eastern Department, International Monetary Fund).
1996, Goals for Social Integration and Realities of Social Exclusion in the Republic of Yemen, (Geneva: International Institute for Labour Studies).
Household Budget Survey 1998, 1999, (Sana’a, Yemen: Central Statistical Office).
International Bank for Reconstruction and Development, 1996, Poverty Assessment Report, March, (Washington).
1996, “Yemen—The Tortuous Quest for Unity, 1990–94,” Royal Institute for International Affairs.
1999, “The Long-Run Evolution of Energy Prices,” Energy Journal, Vol. 20, No. 2, pp. 1–27.
Oil, National Wealth, and Current and Future Consumption Possibilities,” IMF Working Paper 91/69 (Washington: International Monetary Fund).“
United Nations, Development Program, 1999a, Poverty Policy Framework for Yemen, Strategic paper prepared byMohammedAl-Saqour, (ed)April (Sana’a).
United Nations, Development Program, 1999b, Human Development Report (New York: Oxford University Press).
|GNP per capita (in U.S. dollars)||260||270||2,070|
|GNP per capita (PPP. current international dollar)||730||720||4,630|
|Total population (in millions)||15.3||16.1||280|
|Population growth rate (in percent)3||3.2||3.5||2.1|
|Total fertility rate||6.7||6.4||3.6|
|Age dependency ratio (dependents to working-age population)||1.2||1.1||0.7|
|Urban population (in percent)||33.6||34.4||58.4|
|Labor participation rate (in percent of population aged 14–64)||69.3||67.0||57.2|
|Female labor participation rate (in percent of total population)||27.8||27.9||26.5|
|Life expectancy at birth (in years)3||53||59||67|
|infant mortality rate (per 1,000 live births)3||100||98||49|
|Under five mortality rate (per 1,000 live births)||145||137||63|
|Maternal mortality rate (per 100,000 live births)||1,471||…||205|
|Immunized: DPT, under 12 months (in percent of age group)||53||57||90|
|Child malnutrition, under 5 years (in percent of age group)||30||29||14|
|Access to safe water (percent of population)||39||…||85|
|Access to sanitation (percent of population)||19||…||62|
|Adult literacy rate||40||42||62|
Algeria, Bahrafn, Djibouti, Egypt Iran, Iraq, Jordan, Lebanon, Libya, Malta, Morocco, Oman, Saudi Arabia, Syria, and Tunisia.
Data for the nearest year to 1997.
Second column data are for 1998.
|(Change in percent)|
|Production and prices|
|Nominal GDP at market prices||28.4||67.1||43.7||21.5||0.4||24.3|
|Real GDP at market prices||−3.6||7.9||2.9||8.1||5.3||3.8|
|Real non-oil GDP||−9.6||5.5||0.5||8.2||5.9||3.2|
|Real oil GDP||43.7||20.0||13.5||7.5||2.7||6.2|
|Consumer price index (annual average)||71.3||62.5||40.0||4.6||11.5||8.0|
|Crude export oil price|
|(weighted average, U.S. dollar per barrel)||15.4||16.9||20.3||18.5||11.6||18.7|
|(In percent of GDP)|
|Total revenue and grants||12.8||19.5||35.9||32.8||26.4||31.8|
|Overall balance (commitment basis)||−16.3||−16.3||−16.3||−16.3||−16.3||−16.3|
|Overall balance including grants (cash basis)||−15.7||−5.2||0.6||−1.8||−7.9||−0.4|
|(12-month change in percent of initial broad money)|
|Credit to nongovernment sector||69.0||28.0||−29.4||46.6||54.2||15.0|
|Benchmark deposit interest rate (percent p.a.)||6.5||20.0||25.0||11.0||15.0||18.0|
|Velocity (Non-oil GDP/M2)||1.2||1.7||1.9||2.0||2.2||2.1|
|(In millions of US. dollars)|
|Private remittances and transfers (net)||1,117||1,104||1,188||1,256||1,254||1,314|
|Capital account (net)||−641||−876||−397||34||−154||11|
|Central bank own gross foreign reserves||357||525||937||1,152||853||1,351|
|In months of imports1||2.9||3.1||4.6||5.3||4.2||6.0|
|Current account, including grants (in percent of GDP)||5.6||2.8||1.7||0.3||−3.7||2.9|
|Debt service ratios2|
|Official external debt||10,876||11,017||11,135||5,359||5,373||5,490|
|(In percent of GDP)||167||170||173||81||85||80|
|Terms of trade (1996=100)||85.5||85.3||100.0||100.7||69.5||114.1|
|Exchange rate (free market, eop) (YR1s/US$)||101.0||127.1||126.9||130.5||141.7||159.7|
|Real effective exchange rate (1996=100)3||…||76.2||100.0||109.7||119.5||107.1|
Gross reserves minus commercial bank foreign exchange deposits held with the central bank. Imports are for the current year and exclude oil and gas sector imports.
Public and publicly guaranteed debt, including central bank foreign liabilities. In percent of exports of goods and services.
INS. based on free market rate.
|(In millions of Yemeni rials)|
|Agriculture and forestry||63,342||90,330||108,526||124,750||158,397||167,441|
|Mining and quarrying||858||1,640||2,449||2,506||2,524||2,705|
|Oil and gas1||17,790||69,116||191,273||244,915||137,758||263,309|
|Electricity, gas, and water||2,034||3,111||5,334||6,718||7,912||8,401|
|Wholesale and retail trade||30,077||49,634||58,918||72,877||87,910||99,807|
|Restaurants and hotels||2,065||3,375||4,047||5,101||6,152||6,983|
|Transportation, storage, and communications||44,625||64,618||83,056||104,337||113,219||127,814|
|Real estate and business services||7,831||12,149||16,840||21,007||25,045||28,827|
|Community, social, and personal services||6,933||11,000||12,784||14,536||16,728||18,625|
|Private, nonprofit services||196||140||270||304||342||384|
|Less: Imputed bank services charges||−11,364||−16,644||−14,886||−15,703||−20,688||−22,056|
|(In percent of GDP)|
|Agriculture and forestry||21.7||16.5||15.5||14.6||18.5||15.7|
|Mining and quarrying||0.3||0.3||0.3||0.3||0.3||0.3|
|Oil and gas||6.1||14.1||27.2||28.7||16.1||24.8|
|Electricity, gas, and water||0.7||0.6||0.8||0.8||0.9||0.8|
|Wholesale and retail trade||10.3||10.2||8.4||8.5||10.3||9.4|
|Restaurants and hotels||0.7||0.7||0.6||0.6||0.7||0.7|
|Transportation, storage, and communications||15.3||13.2||11.8||12.2||13.2||12.0|
|Real estate and business services||2.7||2.5||2.4||2.5||2.9||2.7|
|Community, social, and personal services||2.4||2.3||1.8||1.7||2.0||1.8|
The large increases in oil and gas GDP in 1993 and 1996 are in large part due to exchange rate effects. The official exchange rate increased from YRls 12US$ in 1994 to YRls 40.5/US$ in 1995 and YRls 114 /US$ in 1996.
|Gross fixed capital formation||56,773||99,025||143,207||198,543||180,976||197,758|
|Change in stocks||3,012||2,032||2,948||3,486||0||0|
|Net exports of goods and nonfactor services||−7,611||−31,843||−43,141||−76,690||−152,264||−72,318|
|GDP at market prices||292,279||488,509||702,112||852,897||855,945||1,063,557|
|Net factor income2||−25,994||−37,682||−74,414||−81,535||−48,813||−101,968|
|Gross national product||266,285||450,827||627,698||771,362||807,132||961,589|
|Net current transfers2,3||50,019||83,278||129,212||162,350||170,340||204,675|
|Gross national disposable income||316,304||534,105||756,909||933,712||977,473||1,166,264|
|Gross domestic saving||52,174||69,213||103,014||125,339||28,712||125,445|
|Gross national savings from disposable income||76,199||114,810||157,812||206,154||150,239||228,152|
|Public sector national savings4||39,706||−14,696||18,834||41,391||−1,537||56,877|
|Private sector national savings4||115,905||129,506||138,977||164,763||151,776||171,275|
|(In percent of GDP)|
|Gross fixed capital formation||19.4||20.3||20.4||23.3||21.1||18.6|
|Change in stocks||1.0||0.4||0.4||0.4||0.0||0.0|
|Net exports of goods and nonfactor services||−2.6||−6.5||−6.1||−9.0||−17.8||−6.8|
|Net factor income||−8.9||−7.7||−10.6||−9.6||−5.7||−9.6|
|Gross national product||91.1||92.3||89.4||90.4||94.3||90.4|
|Net current transfers||17.1||17.0||18.4||19.0||19.9||19.2|
|Gross national disposable income||108.2||109.3||107.8||109.5||114.2||109.7|
|Gross domestic saving||17.9||14.2||14.7||14.7||3.4||11.8|
|Gross national savings from disposable income||26.1||23.5||22.5||24.2||17.6||21.5|
|Public sector national savings4||−13.6||−3.0||2.7||4.9||−0.2||5.3|
|Private sector national savings4||39.7||26.5||19.8||19.3||17.7||16.1|
Uses data from the fiscal accounts.
Uses balance of payments data.
Includes workers’ remittances.
The large increases in public sector savings and declines in private sector savings in 1995–96 are attributable largely to the effects of exchange rate depreciations and world prices increases.
|(in millions of 1990 Yemeni rials)|
|Agriculture and forestry||33,365||35,688||36,158||39,075||44,497||44,375|
|Mining and quarrying||312||345||396||403||364||368|
|Oil and gas||20,156||24,197||27,469||29,542||30,326||32,217|
|Electricity, gas, and water||1,552||1,763||1,979||2,018||2,066||2,215|
|Wholesale and retail trade||8,452||9,764||10,563||11,263||12,185||12,929|
|Restaurants and hotels||408||467||506||563||609||646|
|Transportation, storage, and communications||14,379||13,973||12,016||13,996||13,623||14,373|
|Real estate and business services||4,117||4,404||4,598||4,953||5,296||5,697|
|Community, social, and personal services||2,364||2,395||2,573||2,771||2,860||2,976|
|Private, nonprofit services||57||65||69||73||67||76|
|Less: imputed bank services charges||−3,303||−3,100||−2,028||−2,088||−3,496||−3,490|
|Total GDP at market prices.||121,273||130,912||134,754||145,652||153,342||159,160|
|(Changes in percent)|
|Agriculture and forestry||−3.3||7.0||1.3||8.1||13.9||−0.3|
|Mining and quarrying||−3.1||10.6||14.8||1.8||−9.7||1.1|
|Oil and gas||43.7||20.0||13.5||7.5||2.7||6.2|
|Electricity, gas, and water||−10.3||13.6||12.3||2.0||2.4||7.2|
|Wholesale and retail trade||−13.2||15.5||8.2||6.6||8.2||6.1|
|Restaurants and hotels||−13.6||14.5||8.4||11.3||8.2||6.1|
|Transportation, storage, and communications||−19.2||−2.8||−14.0||16.5||−2.7||5.5|
|Real estate and business services||6.2||7.0||4.4||7.7||6.9||7.6|
|Community, social, and personal services||4.5||1.3||7.4||7.7||3.2||4.1|
|Agriculture, forestry, and fishing||1,667||52.3||1,928||49.2||1,996||48.5|
|Mining and quarrying||10||0.3||13||0.3||13||0.3|
|Electricity, gas, and water||14||0.4||21||0.5||21||0.5|
|Trade, restaurants, and hotels||332||10.4||415||10.6||440||10.7|
|Transport, storage, and communication||150||4.7||196||5.0||210||5.1|
|Finance, insurance, and real estate||35||1.1||47||1.2||49||1.2|
|Social and community services||224||7.0||365||9.3||412||10.0|
Data for 1994 are based on the general population census of that year; 1998 and 1999 data based on Ministry of Planning estimates.
|Private sector||59.5||39.7||57.0||84.4||97.7||88.0||79 0||92.1||82.3|
|Average household income||36,988||26,654||29,035|
|Average household member income||5,024||3,763||4,096|
|Average household expenditure on food||20,727||19,818||20,026|
|Average household expenditure on nonfood||17,624||9,562||11,421|
|Ratio of household income to expenditure (in percent)||96.4||90.7||92.3|
|Average household size (persons)||7.11||7.08||7.09|
|Illiteracy rate (in percent)||27.47||56.57||49.47|
|Median age of population (in years)||15.9||14.2||14.6|
|Read and write||33.4||24.5||36.9||16.1||26.8||38.2||30.3||44.4||20.0||32.2|
|Post-high school diploma||0.8||0.2||0.6||0.1||0.4||1.4||0.6||1.3||0.2||0.8|
|University and above||3.1||0.4||1.7||0.4||1.1||3.3||0.5||2.0||0.6||1.3|
|A Total net output1||334||342||344||360||367||389|
|B. Companies’ exports||154||155||137||137||177||158|
|1. Companies’ net output share||107||110||117||118||100||112|
|2. Cost recovery||88||85||60||56||107||75|
|3. Income tax||41||41||40||37||30||28|
|C. Government exports||135||123||129||150||112||146|
|D. Government sates to refineries||45||64||78||73||77||85|
|Average oil export price (US$/bbl)||15||17||20||18||12||19|
|Export revenue (million US$)||1,615||1,735||1,976||1,945||1,229||2,131|
Net of miscellaneous oil field uses.
Including YICOM share.
|Company Licensed||Year Awarded||Selected Terms of Contract|
|S1||Vintage/TransGlobe||1997||150 km2 of 3-d seismic data to be acquired and three wells to be drilled over the first 2½-year phase, at estimated minimum cost US$11 million.|
|S2||Preussag||1997||Block had just been relinquished by consortium of Oxy/Amerada Hess/Mol.|
|9||Cal Valley Petroleum||1997||US$8 million to be spent during the initial three-year exploration period.|
|31||Oil and Gas Mine Co.||1997||US$20 million to be spent on the two blocks (31 and 41) including the acquisition of 800 km of 2-d seismic data and the drilling of two exploration wells|
|41||Oil and Gas Mine Co.||1997|
|49||MOL||1997||Minimum expenditure of US$8 million, including 300 km of seismic acquisition and two exploration wells over three years.|
|50||Kerr-McGee/Canadian Oxy/YGCOG||1997||Current stakes are 47.5 percent, 47.5 percent, and 5 percent, respectively.|
|51||Kerr-McGee/Canadian Oxy/YGCOG||1997||Current stakes are 47.5 percent, 47.5 percent, and 5 percent, respectively.|
|53||Dove/YGCOG||1997||Stakes: 75 percent and 25 percent respectively.|
|11||CanadianOxy||1998||At least US$ 11.5 million to be spent over seven years.|
|12||CanadianOxy||1998||At least US$ 11.5 million to be spent over seven years.|
|36||CanadianOxy||1998||At least US$ 11.5 million to be spent over seven years.|
|43||First Calgary Petroleum/ Ocean Energy||1998||Expenditure set at US$7.5 million for each of the two 2½-year periods|
|48||MOL||1998||A minimum of US$ 15 million to be spent over three years; work program to include acquisition of 500 km of 2-d seismic data and the drilling of two exploration wells.|
|54||CanadianOxy||1998||At least US$ 11.5 million to be spent over seven years.|
|15||Oil Search/Muhammad Al-Otaiba Group||1999||A minimum US$10 million to be invested in the first phase, two exploration wells to be drilled, and geological studies to be conducted.|
|2||Agip/Sonatrach||1999||The Algerian Sonatrach has a 40 percent interest in the block|
|20||Adair International Oil and Gas Inc./PIE||1999||Seismic operations to have begun in 2000; two exploratory wells and a minimum of US$ 16.8 million to be spent in two exploratory periods.|
|(Millions of liters)|
|Total petroleum products||3,653||3,927||4,033||4,155||4,043||3,911|
|Total petroleum products||−7.6||7.5||2.7||30||−2.7||−3.3|
|Electricity (million kwh)||2,159||2,369||2,457||2,482||2,557||2,633|
|Salt (thousand tons)||118||71||135||136||147||149|
|Quarried stone (thousand cubic meters)||…||2,823||2,397||2,437||2,497||2,547|
|Gypsum (thousand tons)||99||100||97||99||102||103|
|Food, beverage, and tobacco industries|
|Bread (thousand tons)||7||178||159||162||170||179|
|Biscuits and confectioneries (thousand tons)||69||68||64||65||43||44|
|Ghee and edible oils (thousand tons)||99||97||106||108||108||109|
|Soft drinks (million liters)||67||51||34||35||45||46|
|Mineral water (thousand cubic meters)||114||81||76||77||56||57|
|Vimto drink (thousand of liters)||1,602||2,963||2,718||2,491||…||…|
|Ice (thousand tons)||36||54||58||59||61||61|
|Milk and products (million liters)||68||66||47||48||54||55|
|Ice cream (tons)||144||2,054||1,632||1,665||1,715||1,749|
|Cigarettes (million units)||5,423||6,540||6,740||6,800||6,040||5,859|
|Underwear (thousand pieces)||360||278||287||293||…||…|
|Woolen pullover (thousand pieces)||…||0||28||0||…||…|
|Weaving (million meters)||7||5||5||5||5||…|
|Ginning (thousand tons)||1||1||2||2||…||…|
|Household utensils (tons)||747||604||2,434||1,740||1,775||1,793|
|Doors and windows (thousand square meters)||…||604||690||703||…||…|
|Metallic scrubbers (tons)||123||110||52||53||…||…|
|Stationary engines (thousands)||…||28||31||32||…||…|
|Metal suitcases (thousands)||50||…||10||…||…||…|
|Cement (thousand tons)||898||1,100||1,070||1,038||1,207||1,231|
|Red bricks (thousands)||…||14,033||14,319||14,605||14,897||15,120|
|Cement bricks (thousands)||…||81,118||85,315||87,021||89,000||90,780|
|Marble (thousand square meters)||11||75||83||83||86||88|
|Plastic footwear (thousand pairs)||5||9||7||7||7||7|
|Foam rubber (tons)||1,642||1,918||1,556||1,572||…||…|
|Household utensils (tons)||985||4,730||3,830||3,873||…||…|
|Water cubes (tons)||813||5,917||3,721||3,759||…||…|
|Plastic sheets (tons)||4,786||5,673||10,151||10,354||…||…|
|Plastic tubes (tons)||4,307||7,640||7,264||7,409||…||…|
|Paint (thousand liters)||7,752||9,882||8,331||8,247||7,137||…|
|Soap (thousand tons)||30||32||24||23||20||…|
|Perfume (thousand ounces)||1,049||900||901||919||…||…|
|Oxygen gas (thousand cubic meters)||110||117||0||…||…||…|
|Heat insulation (tons)||…||12||13||…||…||…|
|Fuel gas (thousand tons)||233||313||298||325||…||…|
|Paper and printing|
|Paper tissues (tons)||455||1,082||1,917||1,936||1,948||1,967|
|School books (tons)||…||6,807||6,944||4,014||7,063||7,204|
|Cartons (thousand tons)||12||12||11||11||13||14|
Data for 1998–99 are provisional, as compilation of the underlying data is not yet completed.
|Sorghum and millet|
|Grapes, dates, and other fruits|
Data for 1999 are preliminary.
|Total meat and milk||220.4||241.3||253.0||261.1||274.9||280.4|
|Total fish catch||81.9||85.9||103.7||115.6||127.6||137.3|
|Surface water fish||80.3||84.3||94.3||93.5||104.9||111.2|
|Deep water fish||0.1||0.1||6.7||12.4||12.1||14.5|
|Other aquatic catch||1.5||1.5||2.7||9.7||10.6||11.6|
|(December 1994 = 100)|
|(Changes in percent)|
The CPI is based on consumption shares from the 1992 Household Budget Survey and consists of a weighted average of the price Indices for Sana’a and Aden. The numbers are end-of-period.
|(In Yemeni rials per liter, unless otherwise indicated)|
|LPG (12.5 kg cylinder)||50.0||120.0||165.0||165.0||165.0||200.0||200.0||200.0|
|Electricity (per kWh)||2.07||2.07||5.40||5.40||5.80||8.70||8.70||8.70|
|(In U.S. dollars per liter, unless otherwise indicated)|
|LPG (12.5 kg cylinder)||0.41||1.58||1.28||1.27||1.25||1.46||1.25||1.24|
|Electricity (per kWh)||0.02||0.03||0.04||0.04||0.04||0.06||0.05||0.05|
|Exchange rate (YR1s/US$)4||120.5||76.0||129.0||130.2||132.5||137.0||160.5||161.0|
For electricity plants.
For cement plants.
In May 1999, aviation fuel prices were increased above world market levels and were to be maintained at levels exceeding international prices, which explains the increase implemented in April 2000.
End-period free market exchange rate for the relevant month.
|(In millions of rials)|
|Total revenue and grants||37,538||95,296||251,899||279,459||225,959||338,253|
|Oil and gas revenue||10,786||45,621||176,192||188,415||117,772||210,598|
|Crude oil exports||9,194||31,559||98,824||128,999||73,002||134,854|
|Domestic oil and gas||1,592||14,062||77,368||59,416||44,770||75,744|
|Total expenditure and net lending||84,741||125,040||279,594||295,882||280,080||340,872|
|Civilian wages and salaries||28,435||35,754||47,664||52,390||64,287||78,341|
|Materials and services||5,278||7,507||16,241||24,872||25,632||32,527|
|Defense (wage and non wage)||28,263||32,912||39,170||51,334||52,247||61,548|
|Wheat and flour||0||11,465||51,964||38,592||25,702||4,329|
|Electricity: transfer to PEC||0||0||1,980||2,161||0||0|
|Civil service pension fund||0||0||300||2,230||2,736||…|
|Social welfare fund||0||0||500||1,700||4,388||5,946|
|Development operation and|
|Ministry of Planning||5,526||10,381||37,675||44,443||36,813||…|
|Overall balance (commitment)||−47,203||−29,744||−27,695||−16,424||−54,121||−2,619|
|Rescheduled and pending interest|
|Overall balance (cash)||−45,764||−25,288||4,367||−15,712||−67,822||−4,302|
|Bilateral and multilateral loans (net)||−8,222||−28,111||−59,446||−8,597||−8,654||4,211|
|Payment of late interest and short-term|
|arrears (Paris Club and other)||0||0||0||−2,237||0||0|
|(In percent of GDP)|
|Overall balance (commitment)||−17.4||−6.6||−3.9||−1.9||−6.3||−0.2|
|Overall balance (cash)||−16.9||−5.6||0.6||−1.8||−7.9||−0.4|
|Primary cash balance2||−14.3||−5.0||2.6||−0.6||−4.7||3.9|
|Public sector savings||−15.0||−3.6||2.4||4.3||−0.6||4.4|
|Total revenue and grants||13.9||21.1||35.9||32.8||26.4||31.8|
|Oil and gas revenue||4.0||10.1||25.1||22.1||13.8||19.8|
|Crude oil exports||3.4||7.0||14.1||15.1||8.5||12.7|
|Domestic oil and gas||0.6||3.1||11.0||7.0||5.2||7.1|
|Total expenditure and net lending||31.3||27.7||39.8||34.7||32.7||32.1|
|Civilian wages and salaries||10.5||7.9||6.8||6.1||7.5||7.4|
|Materials and services||1.9||1.7||2.3||2.9||3.0||3.1|
|Wages and salaries||8.5||5.1||3.8||3.5||3.8||3.6|
|Wheat and flour||0.0||2.5||7.4||4.5||3.0||0.4|
|Civil service pension fund||0.0||0.0||0.0||0.3||0.3||…|
|Social welfare fund||0.0||0.0||0.1||0.2||0.5||0.6|
|Ministry of Planning||2.0||7.3||5.4||5.2||4.3||…|
Allocations to the Agriculture and Roads Maintenance Funds, development operation and maintenance and other items.
Overall balance, excluding interest obligations.
|(In millions of Yemeni rials)|
|Crude oil export receipts||9,194||31,559||98,824||128,999||73,002||134,854|
|Domestic oil and gas revenues||1,592||14,062||77,368||59,416||44,770||75,744|
|Payment for past excess cost recovery||0||0||16,290||0||0||0|
|Taxes on goods and services||4,394||9,996||15,180||21,226||24,974||24,419|
|Taxes on income||3,786||5,553||8,765||10,685||13,093||16,389|
|Corporate profits tax||3,128||4,262||5,804||8,318||13,156||14,498|
|Zakat equivalent on foreign companies||0||0||42||85||48||…|
|Real estate transfer tax||418||533||460||776||757||943|
|Non-oil nonfinancial public enterprises||803||4,329||5,314||7,844||2,712||4,064|
|Post and telecommunications||…||200||300||789||574||700|
|Fees and charges||1,248||2,978||4,481||4,349||6,695||…|
|Foreign oil company exploration fees||0||0||252||130||169||…|
|Delayed military service fee||0||0||230||305||453||510|
|Other nontax revenue||1,866||600||3,750||3,612||2,624||…|
|Fines and forfeitures||231||236||350||…||…||…|
|Foreign oil company signature bonuses||36||0||500||1,211||882||…|
|(In percent of GDP)|
|Crude oil exports||3.4||7.0||14.1||15.1||8.5||12.7|
|Domestic oil and gas revenues||0.6||3.1||11.0||7.0||5.2||7.1|
|Payment for past excess cost recovery||0.0||0.0||2.3||0.0||0.0||0.0|
|Taxes on goods and services||1.6||2.2||2.2||2.5||2.9||2.3|
|Taxes on income||1.4||1.2||1.2||1.3||1.5||1.5|
|Corporate profits tax||1.2||0.9||0.8||1.0||1.5||1.4|
|Non-oil public enterprises||0.3||1.0||0.8||0.9||0.3||0.4|
|Fees and charges||0.5||0.7||0.6||0.5||0.8||…|
|Other nontax revenue||0.7||0.1||0.5||0.4||0.3||…|
|GDP at market prices (in millions YRls)||270,900||451,530||702,112||852,897||855,945||1,063,557|
Includes Zakat for 1993–95.
For l994–96, includes fees not attributed to entries specified above.
|(In millions of Yemeni rials)|
|Total expenditure and net lending||84,741||125,040||279,594||295,882||280,080||340,872|
|Civilian wages and salaries||28,435||35,754||47,664||52,390||64,287||78,341|
|Materials and services||5,278||7,507||16,241||24,872||25,632||32,527|
|Agricultural and road maintenance funds||0||729||1,870||2,381||2,732||1,856|
|Parliamentary and judiciary expenses||0||1,860||2,086||2,968||4,023||5,945|
|Accounting and audit authority||0||0||0||474||538||746|
|Wheat and flour||0||11,465||51,964||38,592||25,702||4,329|
|Electricity; transfer to PEC||0||0||1,980||2,161||0||0|
|Social welfare fund||0||0||500||1,700||4,388||5,946|
|Regular pension contributions||527||737||0||2,230||2,736||…|
|Transfers to civil service pension fund||0||0||300||0||0||…|
|Social and sports activities||1,026||1,270||1,300||1,078||…||…|
|Development operation and|
|Ministry of Planning||5,526||10,381||37,675||44,443||36,813||…|
|Memorandum item: GDP||292,279||488,509||702,112||852,897||855,945||1,063,557|
|(In percent of GDP)|
|Total expenditure and net lending||29.0||25.6||39.8||34.7||32.7||32.1|
|Civilian wages and salaries||9.7||7.3||6.8||6.1||7.5||7.4|
|Materials and services||1.8||1.5||2.3||2.9||3.0||3.1|
|Wheat and flour||0.0||2.3||7.4||4.5||3.0||0.4|
|Ministry of Planning||1.9||2.1||5.4||5.2||4 3||…|
Related to the IDA public works project.
|Broadcasting and Television Corporation||313||372||1,017||1,260||1,599|
|Mineral Exploration Organization||79||78||153||163||191|
|Oil Exploration Corporation||96||107||145||237||253|
|Organization for Agricultural Research||140||148||202||233||318|
|Rural Development Organization||52||51||72||102||140|
|Touhama Development Organization||90||96||157||157||198|
|Yemen News Agency||52||57||68||107||145|
|Other agricultural and industrial enterprises||162||180||109||155||333|
|Financial support for troubled enterprises||0||0||0||407||312|
|Broadcasting and Television Corporation||28||936||…||486||338|
|Civil Aviation and Meteorology Authority||60||84||…||323||622|
|National Water and Sewerage Corporation||198||0||…||1,406||3,009|
|Postal Service Organization||75||26||…||64||60|
|Public Authority for Rural Electricity and Water||369||0||…||3,130||2,587|
|Public Electricity Corporation||256||3,935||…||5,521||7,201|
|Rural Areas Development Organization||93||0||…||150||115|
|Yemen Company for Oil Investment in Jannah||0||0||…||400||400|
|Aden Free Zone Authority||0||0||…||91||107|
|Foreign currency deposits||45,635||55,599||63,875||76,410||95,992||111,668|
|Foreign assets (net)||22,953||38,899||103,344||145,177||112,532||200,029|
|Central bank (net)||1,624||19,784||87,514||93,637||54,789||136,286|
|Commercial banks (net)||21,329||19,115||15,830||51,540||57,743||63,743|
|Domestic assets (net)||183,237||209,366||166,208||153,212||220,818||179,266|
|Claims on government (net)||178,447||205,003||187,310||164,156||219,768||173,468|
|Central bank (net)||195,274||222,309||204,901||158,304||185,160||135,181|
|Counterpart to YBRD claims on CBY||17,877||22,500||22,463||4,630||5,022||5,659|
|Commercial banks (net)||−2,333||169||6,793||34,398||36,215||39,942|
|Total budget financing (net) excluding YBRD||175,064||199,977||189,230||188,072||216,352||169,464|
|Pension fund term deposits at CBY||14,494||17,475||24,383||28,546||1,607||1,655|
|Claims on nongovernment sector||27,246||34,875||24,605||36,071||55,630||63,970|
|Other items (net)||2,917||−13,305||−33,851||−32,116||−40,181||−47,742|
|Capital and reserves||−3,429||−5,201||−7,269||−11,362||−23,729||−28,762|
|Rial broad money||160,555||192,666||205,676||221,978||237,358||267,627|
|(In millions of US. dollars)|
|Total net foreign currency position||197.4||388.8||578.1||663.3||356.6||832.6|
|Net foreign assets||135.2||395.4||689.6||717.7||386.7||853.3|
|Foreign currency deposits||−153.2||−252.9||−263.6||−223.9||−266.5||−303.1|
|Net foreign assets||211.2||150.4||124.7||395.1||407.5||399.1|
|Foreign currency deposits||−437.3||−395.0||−390.1||−491.8||−600.7||−625.3|
|YBRD claims on Central Bank of Yemen||177.0||177.0||177.0||35.5||35.4||35.4|
|Official exchange rate (end-period)||12.0||50.0||126.9||130.5||141.7||159.7|
|Free market exchange rate (end-period)||101.0||127.1||126.9||130.5||141.7||159.7|
|(Changes in end-year stocks, in millions of Yemeni rials)|
|Foreign currency deposits||13,274||9,965||8,275||12,535||19,582||15,676|
|Net foreign assets||11,212||15,946||64,445||41,833||−32,645||87,496|
|Central bank (net)||1,785||18,160||67,730||6,123||−38,848||81,497|
|Commercial banks (net)||9,427||−2,214||−3,285||35,711||6,203||6,000|
|Net domestic assets||41,856||26,129||−43,158||−12,996||67,606||−41,552|
|Claims on government (net)||48,361||26,555||−17,693||−23,154||55,611||−46,300|
|Central bank (net)||52,835||27,035||−17,408||−46,597||26,856||−49,979|
|Total budget financing (net)||46,949||22,412||−17,371||−28,764||26,464||−50,616|
|Counterpart to Yemen Bank for|
|Reconstruction and Development|
|claims on the Central Bank of Yemen||5,886||4,623||−37||−17,833||393||637|
|Commercial banks (net)||−1,071||2,502||6,624||27,606||1,816||3,727|
|Claims on nongovernment sector||11,121||7,629||−10,271||11,467||19,559||8,340|
|Other items (net)||1,896||−16,222||−20,547||1,736||−7,564||−3,592|
|Capital and reserves||−832||−1,772||−2,068||−4,093||501||3,969|
|(Changes in percent of broad money)||(Changes in percent)|
|Foreign currency deposits||8.7||4.8||3.3||4.7||6.6||4.7|
|Net foreign assets||7.3||7.7||26.0||15.5||−10.9||26.2|
|Central bank (net)||1.2||8.8||27.3||2.3||−13.0||24.4|
|Commercial banks (net)||6.2||−1.1||−1.3||13.2||2.1||1.8|
|Net domestic assets||27.3||127||−17.4||−4.8||22.7||−12.5|
|Claims on government (net)||31.6||12.9||−7.1||−8.6||18.6||−13.9|
|Total budget financing (net)||30.7||10.9||−7.0||−10.7||8.9||−15.2|
|Claims on nongovernment sector||7.3||3.7||−4.1||4.3||6.6||2.5|
|Other items (net)||1.2||−7.9||−8.3||0.6||−2.5||−1.1|
|Capital and reserves||−0.5||−0.9||−0.8||−l.5||0.2||1.2|
|Rial broad money||33.0||20.0||6.8||7.9||6.9||12.8|
|Rial demand deposits||17.9||22.0||3.4||9.0||2.0||0.0|
|Claims on private sector||39.2||35.4||−6.3||53.8||57.7||15.2|
|U.S. dollar equivalent||…||1.5||2.6||84.3||32.1||23.5|
|(Ratios to rial broad money)|
|Rial demand deposits||0.18||0.18||0.18||0.18||0.17||0.15|
|(In Yemeni Rials)|
|Gold, silver, and foreign currency||280||1,767||6,391||5,359||5,946||6,945|
|Foreign exchange held abroad||3,425||26,586||106,524||132,240||107,635||192,319|
|IMF reserve position (IMF record)||0||0||0||0||0||0|
|Claims on government||199,074||231,842||221,520||175,864||201,724||159,621|
|Counterpart to YBRD claims1||17,877||22,500||22,463||4,630||5,022||5,659|
|Claims on public enterprises||57||0||10||50||1,108||895|
|Claims on commercial banks||40||94||54||49||0||0|
|Fixed and other assets||2,335||11,488||9,786||11,295||17,340||24,652|
|Assets = Liabilities||205,794||274,531||362,815||347,507||359,099||422,854|
|Currency outside banks||111,006||129,114||120,477||126,904||139,668||166,924|
|Currency with banks||1,940||1,884||1,908||2,652||2,663||2,160|
|Commercial banks deposits||30,535||32,965||57,190||25,282||32,892||42,538|
|Public enterprise deposits||7,985||22,233||29,421||32,799||27,754||22,556|
|Foreign currency deposits||1,464||5,390||14,363||12,246||10,868||11,795|
|Social security fund deposits||14,494||17,475||24,383||28,546||1,607||1,655|
|Claims of YBRD1||17,877||22,500||22,463||4,630||5,022||5,659|
|Exchange valuation account||2,737||4,254||11,814||12,272||13,231||9,194|
|Capital and reserves||600||600||600||600||600||600|
|(In millions of US. dollars)|
|Net foreign assets||135||395||690||718||387||853|
|Foreign currency deposits||153||253||264||224||267||303|
|Net foreign currency position||−28||245||535||585||270||740|
|Central bank gross foreign assets||357||622||1,036||1,228||980||1,488|
|Central bank own gross foreign assets||355||584||937||1,154||853||1,351|
Foreign currency claims originally equivalent to US$177 million valued at the He market exchange rate, reduced to US$35 in 1997.
|(In millions of Yemeni rials)|
|Balances with banks abroad||43,387||36,863||38,554||54,320||60,342||66,726|
|Claims on nonresidents||127||0||0||…||0||0|
|Deposits with central bank||30,959||42,171||57,995||25,400||33,051||41,470|
|(in millions of U.S. dollars)||0||96||99||75||125||135|
|Claims on government||390||1,295||6,963||34,873||36,267||0|
|Credit to government||390||422||342||324||0||39,972|
|Claims on nongovernment sector||27,189||34,875||24,595||36,021||0||0|
|Credit to public enterprises||9,376||10,826||2,056||1,453||12||0|
|Credit to private sector||17,619||23,865||22,358||34,380||0||0|
|Credit to mixed enterprises||194||185||181||188||13,993||19,478|
|Interbranch accounts (net)||149||0||0||151||0||0|
|YBRD claims on CBY2||17,877||22,500||22,463||4,630||20,700||24,477|
|Assets = Liabilities||158,873||178,145||179,252||191,487||0||0|
|in foreign currency||98,422||112,966||84,886||87,834||0||0|
|Deposits of foreign banks||1,268||568||1,069||440||1,265||0|
|in local currency||20||18||6||6||4||7,248|
|in local currency||1,250||1,111||1,692||1,131||4||2|
|Borrowing from foreign banks||24,091||20,984||22,788||5,451||950||947|
|Foreign currency deposits||44,171||50,209||49,512||64,165||85,124||4,185|
|(in millions of U.S. dollars)||437||395||390||491||601||0|
|Credit from central bank||42||4||5||26||23||0|
|Capital and reserves||2,829||4,601||6,669||10,762||23,129||32|
|Interbranch accounts (net)||0||1,381||1,026||0||82||0|
|in foreign currency||75,630||94,675||79,435||77,617||93,632||14,338|
|(In millions of US. dollars)|
|Net foreign currency position||226||144||43||78||87||0|
|Net foreign assets||388||327||302||431||443||93|
|Foreign currency deposits (net)||163||183||259||352||356||435|
|(In percent of total assets)|
Foreign asset, liability, and currency components are evaluated at the free market exchange rate of all periods.
foreign currency claims equivalent to US$177 million over 1993–96 and reduced to US$35 million in 1997.
Also includes nonperforming loans.
|Central bank lending rates|
|Commercial bank lending rates|
|Commercial bank (minimum/benchmark)|
|Three-month time deposits||12.0||20.0||20.0||…||…||…|
|Six-month time deposits||13.0||21.0||21.0||…||…||…|
|Nine-month time deposits||14.0||21.5||21.5||…||…||…|
|One-year time deposits||15.0||22.0||22.0||…||…||…|
|Specialized banks’ lending rates3|
|Medium and long term||9–11||10–12||7–11||7–11||…||…|
|Treasury bill average interest rate on|
Prior to July 1995, a fixed interest rate structure applied to all loans and deposit rates. The mandated minimum deposit rates were not enforced and effective deposit rates were 3–5 percent. Interest rate reform in July 1995 freed interest rates, eliminated concessional loan rates, and enforced benchmark minimum commercial bank deposit rates.
In May 1997, the benchmark system was narrowed to one minimum rate for savings accounts.
As of June 1998, all specialized banks have adopted the interest rate structure applying to commercial banks.
|(in millions of Yemeni rials)|
|Short-term loans and advances||16,264||31,242||22,676||33,058||31,417.9||33,647.4|
|Agriculture and fisheries||351||371||351||130||38.6||121.2|
|Trade in manufactured goods||1,861||2,881||7,038||7,636||8,767.4||4,711.1|
|Medium- and long-term loans||1,085||3,448||1,738||2,774||4,844.1||4,724.8|
|(In percent of total)|
|Short-term loans and advances||94||90||93||92||68||65|
|Agriculture and fisheries||2||1||1||0||0||0|
|Trade in manufactured goods||11||8||29||21||19||9|
|Medium- and long-term loans||6||10||7||8||11||9|
Prior to 1998, a different classification was adopted, which explains gaps in the data for the period 1994–97
Investments refer to lending by Islamic banks on Islamic principles.
|Yemen Bank for Reconstruction and Development (YBRD)||1962||Sana’a||1,000.0||Government||51||37|
|National Bank of Yemen||1969||Aden||1,915.0||Government||100||31|
|United Bank Ltd.||1972||Sana’a||1,000.0||Branch of United Bank (Pakistan)||100||2|
|Arab Bank PLC.||1972||Sana’a||1,043.0||Branch of Arab Bank (Jordan)||100||6|
|Banque Indosuez||1975||Sana’a||1,304.5||Branch of Banque Indosuez (France)||100||5|
|Yemen Commercial Bank||1993||Sana’a||1,145.0||Yemeni Private||100||5|
|Yemen-Kuwait Bank for Trade and Investment||1979||Sana’a||774.5||Yemeni private||100||1|
|International Bank of Yemen||1980||Sana’a||906.0||Yemeni private||75||5|
|Saudi Arabian Banks||25|
|Rafidain Bank||1982||Sana’a||60.0||Branch of Rafidain Bank (Iraq)||100||1|
|Islamic Bank for Finance and Investment||1995||Sana’a||925.0||Yemeni private2||100||2|
|Altadamon Islamic Bank||1996||Sana’a||1,500.0||Yemeni private2||100||8|
|Saba Islamic Bank||1997||Sana’a||1,159.0||Yemeni private2||100||3|
|Industrial Bank of Yemen||1976||Sana’a||96.5||Government||70||—|
|Housing Credit Bank||1977||Sana’a||200.0||Government||70||—|
|Cooperative and Agricultural Credit||1982||Sana’a||293.0||Government||87||34|
Including head office.
With some foreign minority shareholders.
|Problem loans/total loans||55.2||46.1||58.5|
|Problem loans/total assets||11.5||10.2||13.0|
|Provisions against problem loans/problem loans||21.7||27.8||31.0|
|Total capital and reserves/problem loans||46.2||83.0||62.0|
|Average return on assets||1.0||0.9||1.0|
|Average return on equity||13.0||15.0||14.0|
|Total capital and reserves/total assets||5.3||8.5||8.1|
|Risk-weighted capital adequacy ratio||0.6||2.5||5.2|
|Exposure to exchange rate risk:|
|Total foreign currency assets (in billions of rials)||88.4||109.3||127.4|
|Total foreign currency liabilities (in billions of rials)||78.2||97.8||112.8|
|Net exposure/total capital and reserves||100||65.3||77.7|
|Foreign credits/foreign deposits||15.2||16.0||19.0|
|Estimated exposure to real estate market:|
|Total real estate loans/total loans||0.3||2.0||5.2|
|Total construction loans/total loans||0.3||1.9||3.3|
Data refer to the commercial banking system in aggregates, and exclude specialized banks.
|(In millions of U.S. dollars)|
|Oil companies’ share||862.3||957.5||1,017.7||932.7||758.0||1,138.2|
|Oil products, f.o.b.||−207.9||−172.0||−176.5||−165.3||−116 9||−174.3|
|Oil sector capital goods, c.i.f.||−172.8||−113.7||−95.9||−84.5||−66.0||−70.8|
|Other imports, f.o.b||−1,141.2||−1,662.5||−2,021.1||−2,156.7||−2,044.9||−2,194.8|
|Freight and insurance, net||−120.3||−206.5||−233.4||−305.2||−284.2||−311.4|
|Oil processing fees, receipts||5.0||6.0||6.2||8.0||8.0||8.0|
|Other services, net||13.0||−3.5||−3.0||−3.7||−5.0||−31.8|
|Oil companies’ foreign expenditures,|
|Government services, net||−11.4||−7.2||−13.8||−26.7||−18.6||−22.6|
|Compensation of employees||−53.4||−47.9||−47.7||−29.7||−31.0||−27.0|
|General government transfers, net||71.3||40.0||60.2||89.4||59.1||90.9|
|Workers’ remittances, net||1,042.7||1,063.9||1,122.6||1,156.9||1,190.7||1,223.2|
|Other transfers (oil signature bonus)||3.0||0.0||5.6||9.3||3.8||0.0|
|Current account balance||365.9||182.7||106.3||22.6||−230.0||195.1|
|Medium- and long-term loans, net||−684.6||−694.1||−520.7||−66.5||−63.7||27.0|
|Short-term oil trade credits, net||1.3||−32.5||−63.7||63.5||70.7||−119.4|
|Oil sector direct investment, net||15.8||−217.7||−60.1||−138.5||−266.7||−318.8|
|Oil sector loans||−1.5||0.0||0.0||0.0||0.0||0.0|
|Wheat import financing, net||28.0||68.0||167.4||−79.3||−187.2||0.0|
|Private capital, net||0.0||0.0||80.0||255.1||240.2||337.1|
|Errors and omissions||−503.7||655.3||−334.0||59.6||−26.6||198.8|
|Net reserves changes (increase -)||−79.4||−713.0||−36.9||−296.7||317.1||−458.5|
|Change in overdue obligations (increase +)1||858.2||751.3||568.4||−5,867.9||32.4||56.2|
|(In percent of GDP)|
|(In millions of U.S. dollars, unless otherwise indicated)|
|Current account including grants (percent of GDP)||5.6||2.8||1.7||0.3||−3.7||2.9|
|Official grants (percent of GDP)||1.1||0.6||0.9||1.4||0.9||1.3|
|Central bank own gross foreign reserves2||357||525||937||1,152||853||1,351|
|(Months of imports)3||2.9||3.1||4.6||5.3||4.2||6.0|
|Official external debt4||10,876||11,017||11,135||5,359||5,373||5,490|
|(In percent of GDP)||167||170||173||81||85||80|
|Debt service (percent of exports of goods and services)4|
|Change in outstanding IMF credit|
Includes debt to non-Paris Club creditors under discussion to ensure comparable treatment.
Includes central bank SDR holdings, foreign exchange held abroad, foreign securities, gold, silver, and foreign currencies; excludes commercial bank required foreign exchange reserves with the central bank against their foreign currency deposits.
Imports are c.i.f for current year and exclude imports of oil sector capital goods.
Public and publicly guaranteed debt including central bank foreign liabilities. Debt and debt service reflect the 1996 and 1997 Paris Club rescheduling, including the SO percent upfront discount provided by the Russian Federation.
|(In millions of Yemeni rials)|
|Other exports and reexports||1,237||4,522||9,659||16,798||17,869||17,014|
|Hides and skins||113||163||602||1,202||1,137||841|
|Fruits and vegetables||22||128||334||674||664||709|
|Perfumes and cosmetics||60||83||198||378||750||225|
|(In millions of U.S. dollars)3|
|Other exports and reexports||103.0||111.7||85.1||130.3||131.6||109.2|
|Hides and skins||9.4||4.0||5.3||9.3||8.4||5.4|
|Fruits and vegetables||1.9||3.2||2.9||5.2||4.9||4.5|
|Perfumes and cosmetics||5.0||2.1||1.7||2.9||5.5||1.4|
Customs data except for crude oil. includes oil companies’ share of crude oil exports.
Data provided by Ministry of Oil and Mineral Resources and Aden Refinery. Excludes reexports from Aden Refinery under processing arrangements, and includes oil companies’ share of crude oil exports.
Converted from Yemeni rials at the average customs exchange rate.
|United Arab Emirates||1.5||1.0||0.4||0.5||0.8||0.3|
|China, People’s Republic of||2.5||23.3||20.6||30.6||24.9||28.8|
Customs data except for crude oil. Includes oil companies’ share of crude oil exports.
Excludes reexports from Aden Refinery under processing arrangements.
|Food and live animals||450.3||542.8||941.3||802.0||776.2||555.5|
|Meat and live animals||70.9||48.8||39.5||48.8||80.0||69.1|
|Meat and meat products||39.5||24.6||26.1||31.1||42.5||35.2|
|Dairy products and eggs||50.3||36.2||61.3||75.3||83.9||53.2|
|Cereals and their products3||198.5||315.2||648.7||445.9||414.5||263.3|
|Vegetables and fruits||29.4||26.8||40.0||41.0||50.5||31.1|
|Sugar and its products, and honey||59.1||80.1||111.9||137.4||98.6||105.7|
|Coffee, tea, and spices||20.7||20.5||19.1||18.3||18.2||13|
|Beverages and tobacco||32.7||32.4||33.2||35.8||43.6||36.4|
|Wood and cork||26.7||30.4||26.0||24.7||26.7||18.9|
|Minerals, fuels, and lubricants3||236.3||121.3||165.8||223.4||139.4||113.6|
|Animal and vegetable oils||26.4||66.7||50.8||73.1||83||55.2|
|Manufactured goods, classified|
|Wood and cork||14.0||11.4||10.5||16.4||18.6||6.5|
|Iron and steel||96.7||117.1||83.0||107.0||115.8||73.7|
|Machinery and transport|
|Other transport equipment||5.5||5.1||5.3||5.3||22||6.1|
|Professional and scientific|
|Total imports, c.i.f.||1,556.9||1,739.0||2,129.5||2,231.8||2,327.6||1,535.9|
Customs data. Excludes oil company investment goods imports, The sharp fall recorded for total imports in 1999 reflects preliminary and incomplete data reports for the year.
Converted from Yemeni rial data at the average customs exchange rate, except for mineral fuels and lubricants, which are converted at the official rate.
Data for 1994–96 are Central Bank of Yemen estimates.
|United Arab Emirates||9.9||10.8||7.7||8.5||9||11.7|
|China, People’s Republic of||2.0||2.7||3.5||3.4||3.1||2.8|
|Hong Kong SAR||0.5||0.6||0.5||0.4||0.4||0.2|
|Total imports, c.i.f.||100.0||100.0||100.0||100.0||100.0||100.0|
Excludes oil company investment goods imports.
|1. Al-Thawra metal products||30-year lease||Implemented in 1997||Lessee hires 35 of original staff and MOF continues to pay salaries/benefits of remaining workers.|
|2. Agriculture and metal products||30-year lease||Implemented in 1997, 1/1/1998||Lessee hires all of the 96 effective original staff.|
|3. Leather shoe factory||Land and building restituted; equipment sold and new land rented to purchaser for 30 years||Implemented in 1997, effective 1/1/1998||Purchaser hires 15 of original staff and MOF continues to pay salaries/benefits of remaining 78 employees.|
|A. Leather products||Same as (3)||Implemented in 1997||Purchaser keeps five staff and MOF continues to pay salaries/benefits of remaining 73 employees.|
|5. Martyrs’ garment factory||Same as (3)||Implemented in 1997, effective 1/1/1998||Purchaser keeps 10 staff and MOF continues to pay salaries/benefits of remaining 98.|
|6. Vegetable oil factory||Equipment sold and land leased for 30 years||Implemented in 1998||The three employees were retained by purchaser of equipment.|
|7. Soap factory||Equipment sold but no deal concluded on leasing the site||Sale of equipment done in 1997||Technical Privatization Office will take over in handling the fate of the site|
|8. The public bakery||Equipment sold and the building and land rented for other purposes||Sale of equipment finished in 1998, and land leased||Owner keeps 12 staff and MOF continues to pay salaries/benefits of remaining 75 employees.|
|9. Women’s sewing cooperative||Liquidation||Completed in 1999|
|10. Hammam Ali state farm (Dhamar government)||Privatized by rent||Implemented in 1999|
|11 Dar Sa’ad poultry (Aden gov.)||Privatized by rent||Implemented in 1999|
|12. Old Fowah poultry (Hadramout)||Privatized by rent||Implemented in 1999|
|13. New Fowah poultry (Hadramout)||Privatized by rent||Implemented in 1999|
|14. Agricultural machinery rental Station-Saiyoun Hadramout (government)||Privatized by management buyout under new name. Saiyoun Company for Agricultural and Industrial Machinery||Implemented in 1999||This is the only enterprise that has been privatized through Technical Privatization Office.|
|15. Al-Mashhad Farm (Hadramout)||Not available||Implemented in 1999|
|16. National Shipping Agency (Natship)||Not available||Implemented in 1999||Directly privatized by ministry. It was one of the two major activities (shipping) undertaken by the National Shipping Company.|
|17. Stevedoring operations||Not available||Implemented in 1999||Directly privatized by ministry. It was the second major activity (loading/ unloading cargoes) of the National Shipping Company.|
|Supply and Trade Sector|
|18. Consumption society for state, process public, and mixed sectors employees||Liquidation||Implementation was still ongoing in 1999||Might not have been completed by year-end.|
|Name||Status in Process||Remarks|
|1. Aden refinery||Short-listed consultant started evaluation in mid-January 2000, completion of study was expected in July 2000||Oil sector|
|2. Airport ground handling services||Short-lists of consultants approved; invitation letter to them in preparation||Transport sector|
|3. General corporation for land transport||Same as above||Transport sector|
|4. General corporation for cement and marketing production (Sana’a)||Same as above||Industrial sector|
|5. Yemen drug company (Sana’a)||Same as above||Industrial sector|
|Small and Medium Enterprises: Industrial Sector|
|6. The biscuit and candies factory (Aden)||Short-list of consultants ready for HC approval||As of February 1998, had been tendered three times: very low bids each time|
|7. Automatic bakery (Aden)||Same as above||Same as above|
|8. Dairy factory (Aden)||Same as above||Same as above|
|9. Canada Dry factory (Aden)||Same as above|
|10. National tanning factory (Aden)||Same as above|
|11. Tomato paste factory (Lahaj)||Same as above||Labor force estimate in 1997: 118|
|12. Textile and spinning factory (Aden)||Same as above|
|13. Textile and spinning factory (Sana’a)||Negotiation with the Chinese government ongoing for capital share|
|14. The National Company for Aluminum Manufacturing||Cabinet decree just issued for privatization|
|15. The National Company for Sponge and Metal Furniture Manufacturing Ltd.||Same as above|
|16. Agricultural machinery rental station in Al-Dale (Lahaj government)||Short-list ready for HC approval.||Labor force estimate in 1997: 51|
|17. Agricultural machinery rental station in jear (Abyan government)||Same as above||Labor force estimate in 1997: 111|
|18. Agricultural machinery rental station in Behan (Shabwah government)||Same as above||Labor force estimate in 1997: 56|
|19. Agricultural machinery rental station in Laboos (Lahaj government)||Same as above||Labor force estimate in 1997: 34|
|20. Agricultural machinery rental station in Saber (Lahaj government)||Same as above||Labor force estimate in 1997: 91|
|21. Agricultural machinery rental station in Loder (Abyan government)||Same as above|
|22. Agricultural machinery rental station in Mefah (Shabwah government)||Same as above|
|23. Agricultural machinery rental station in Nisab (Shabwah government)||Same as above|
|24. General corporation for fruit and vegetables marketing (Aden government)||Same as above|
|25. Date packing unit (Hadramout government)||Short-list ready for HC approval|
|26. Agricultural machinery rental station (Al Habilin, Lahaj government)||Same as above|
|27. General corporation for agricultural services (Sana’a)||Same as above|
|28. General corporation for poultries (Aden)||Same as above|
|29. Central unit for maintenance and services—subsidiary of the general corporation for fish services and marketing (Aden government)||Short-list ready for HC approval|
|30. Shograh fish canning factory (Abyan government)||Same as above||Labor force estimate in 1997: 147|
|31. Ice factory in Midi (Hajjah government)||Same as above|
|32. Ice factory in Anwar (Abyan government)||Same as above|
|33. Ice factory in Bear Alt (Shabwah government)||Same as above|
|34. Ice factory in Kosia’ar (Hadramout government)||Same as above|
|35. Yemen navigation lines||Short-list ready for HC approval|
|36. Aden dockyards company||Same as above||Labor force estimate in 1997: 366|
|37. Port of Nashtoun||Consultant’s report was submitted||One of the three semi-large enterprises whose pre-privatization strategy is covered by the IDA Project|
|Supply and Trade Sector|
|38. Public corporation for building material trade (Aden)||HC approved sale of assets in June 2000||Labor force estimate in 1997: 612; Evaluation finished prior to 10/98|
|39. Public corporation for textiles and electric supplies||Same as above||Labor force estimate in 1997: 793|
|40. Yemen company for free trade— Al-Nasr, Aden||Same as above||Labor force estimate in 1997: 331 Evaluation finished by 3/99|
|41. Caltex silos complex— subsidiary of the Yemen trade corporation (Aden)||HC approved privatization in June 2000||Labor force estimate in 1997: 60|
|42. Central refrigeration plant— subsidiary of the Yemen trade corporation (Aden)||Short-list ready for HC approval||Labor force estimate in 1997: 192|
|43. Central bakery and mills in Taiz— subsidiary of the public trade corporation for foreign trade and grains||Same as above||Labor force estimate in 1997: 86|
|44. Central bakery and mills in Sana’a— subsidiary of the public trade corporation for foreign trade and grains||A contract was signed with a local consultant company for performing the evaluation||Labor force estimate in 1997: 73|
|45. Central refrigeration plants in Lahaj, Abyan, Shabwah and Al-Mahrah— subsidiaries of the Yemen Trade Corporation||Short-list ready for HC approval|
|46. Public corporation for building material trade in Lahaj, Abyan, Shabwah and Hadramout.||HC approved sale of assets in June 2000||Evaluation completed by 3/99|
|47. Mobile services company (GSM)||The High Tendering Committee is evaluating bidding offers to choose the most successful two bids|
|48. Telephone booths||Work in progress|
|49. National Bank of Yemen||Sale procedures to be decided in June HC meeting|
|50. Yemen Bank for Reconstruction and Development||Restructuring projected to be completed by end 2000, at which time sales procedures could start|
|51. Housing bank||Strategy still under preparation||Recently turned over to TPO to carry out process|
|52. Industrial bank||Committee to liquidate the bank appointed in October 1999|
|53. Agriculture bank||Restructuring plan approved by cabinet Bids being taken (until mid-February) from companies recommended by the World Bank to conduct the restructuring|
|Committed ($)||Disbursed ($)||Percentage of|
Recent Occasional Papers of the International Monetary Fund
208. Yemen in the 1990s: From Unification to Economic Reform, by Klaus Enders, Sherwyn Williams, Nada Choueiri, Yuri Sobolev, and Jan Walliser. 2002.
207. Malaysia: From Crisis to Recovery, by Kanitta Meesook, II Houng Lee, Olin Liu, Yougesh Khatri, Natalia Tamirisa, Michael Moore, and Mark H. Krysl. 2001.
206. The Dominican Republic: Stabilization, Structural Reform, and Economic Growth, by Alessandro Giustiniani, Werner C. Keller, and Randa E. Sab. 2001.
205. Stabilization and Savings Funds for Nonrenewable Resources, by Jeffrey Davis, Rolando Ossowski, James Daniel, and Steven Barnett. 2001.
204. Monetary Union in West Africa (ECOWAS): Is It Desirable and How Could It Be Achieved? by Paul Masson and Catherine Pattillo. 2001.
203. Modern Banking and OTC Derivatives Markets: The Transformation of Global Finance and Its Implications for Systemic Risk, by Garry J. Schinasi, R. Sean Craig, Burkhard Drees, and Charles Kramer. 2000.
202. Adopting Inflation Targeting: Practical Issues for Emerging Market Countries, by Andrea Schaechter, Mark R. Stone, and Mark Zelmer. 2000.
201. Developments and Challenges in the Caribbean Region, by Samuel Itam, Simon Cueva, Erik Lundback, Janet Stotsky, and Stephen Tokarick. 2000.
200. Pension Reform in the Baltics: Issues and Prospects, by Jerald Schiff, Niko Hobdari, Axel Schimmelpfennig, and Roman Zytek. 2000.
199. Ghana: Economic Development in a Democratic Environment, by Sérgio Pereira Leite, Anthony Pellechio, Luisa Zanforlin, Girma Begashaw, Stefania Fabrizio, and Joachim Harnack. 2000.
198. Setting Up Treasuries in the Baltics, Russia, and Other Countries of the Former Soviet Union: An Assessment of IMF Technical Assistance, by Barry H. Potter and Jack Diamond. 2000.
197. Deposit Insurance: Actual and Good Practices, by Gillian G.H. Garcia. 2000.
196. Trade and Trade Policies in Eastern and Southern Africa, by a staff team led by Arvind Subramanian, with Enrique Gelbard, Richard Harmsen, Katrin Elborgh-Woytek, and Piroska Nagy. 2000.
195. The Eastern Caribbean Currency Union–Institutions, Performance, and Policy Issues, by Frits van Beek, Jose Roberto Rosales, Mayra Zermeño, Ruby Randall, and Jorge Shepherd. 2000.
194. Fiscal and Macroeconomic Impact of Privatization, by Jeffrey Davis, Rolando Ossowski, Thomas Richardson, and Steven Barnett. 2000.
193. Exchange Rate Regimes in an Increasingly Integrated World Economy, by Michael Mussa, Paul Masson, Alexander Swoboda, Esteban Jadresic, Paolo Mauro, and Andy Berg. 2000.
192. Macroprudential Indicators of Financial System Soundness, by a staff team led by Owen Evans, Alfredo M. Leone, Mahinder Gill, and Paul Hilbers. 2000.
191. Social Issues in IMF-Supported Programs, by Sanjeev Gupta, Louis Dicks-Mireaux, Ritha Khemani, Calvin McDonald, and Marijn Verhoeven. 2000.
190. Capital Controls: Country Experiences with Their Use and Liberalization, by Akira Ariyoshi, Karl Habermeier, Bernard Laurens, Inci Ötker-Robe, Jorge Iván Canales Kriljenko, and Andrei Kirilenko. 2000.
189. Current Account and External Sustainability in the Baltics, Russia, and Other Countries of the Former Soviet Union, by Donal McGettigan. 2000.
188. Financial Sector Crisis and Restructuring: Lessons from Asia, by Carl-Johan Lindgren, Tomás J.T. Baliño, Charles Enoch, Anne-Marie Guide, Marc Quintyn, and Leslie Teo. 1999.
187. Philippines: Toward Sustainable and Rapid Growth, Recent Developments and the Agenda Ahead, by Markus Rodlauer, Prakash Loungani, Vivek Arora, Charalambos Christofides, Enrique G. De la Piedra, Piyabha Kongsamut, Kristina Kostial, Victoria Summers, and Athanasios Vamvakidis. 2000.
186. Anticipating Balance of Payments Crises: The Role of Early Warning Systems, by Andrew Berg, Eduardo Borensztein, Gian Maria Milesi-Ferretti, and Catherine Pattillo. 1999.
185. Oman Beyond the Oil Horizon: Policies Toward Sustainable Growth, edited by Ahsan Mansur and Volker Treichel. 1999.
184. Growth Experience in Transition Countries, 1990–98, by Oleh Havrylyshyn, Thomas Wolf, Julian Berengaut, Marta Castello-Branco, Ron van Rooden, and Valerie Mercer-Blackman. 1999.
183. Economic Reforms in Kazakhstan, Kyrgyz Republic, Tajikistan, Turkmenistan, and Uzbekistan, by Emine Gürgen, Harry Snoek, Jon Craig, Jimmy McHugh, Ivailo Izvorski, and Ron van Rooden. 1999.
182. Tax Reform in the Baltics, Russia, and Other Countries of the Former Soviet Union, by a staff team led by Liam Ebrill and Oleh Havrylyshyn. 1999.
181. The Netherlands: Transforming a Market Economy, by C. Maxwell Watson, Bas B. Bakker, Jan Kees Martijn, and Ioannis Halikias. 1999.
180. Revenue Implications of Trade Liberalization, by Liam Ebrill, Janet Stotsky, and Reint Gropp. 1999.
179. Disinflation in Transition: 1993–97, by Carlo Cottarelli and Peter Doyle. 1999.
178. IMF-Supported Programs in Indonesia, Korea, and Thailand: A Preliminary Assessment, by Timothy Lane, Atish Ghosh, Javier Hamann, Steven Phillips, Marianne Schulze-Ghattas, and Tsidi Tsikata. 1999.
177. Perspectives on Regional Unemployment in Europe, by Paolo Mauro, Eswar Prasad, and Antonio Spilimbergo. 1999.
176. Back to the Future: Postwar Reconstruction and Stabilization in Lebanon, edited by Sena Eken and Thomas Helbling. 1999.
175. Macroeconomic Developments in the Baltics, Russia, and Other Countries of the Former Soviet Union, 1992–97, by Luis M. Valdivieso. 1998.
174. Impact of EMU on Selected Non–European Union Countries, by R. Feldman, K. Nashashibi, R. Nord, P. Allum, D. Desruelle, K. Enders, R. Kahn, and H. Temprano-Arroyo. 1998.
173. The Baltic Countries: From Economic Stabilization to EU Accession, by Julian Berengaut, Augusto Lopez-Claros, Francoise Le Gall, Dennis Jones, Richard Stern, Ann-Margret Westin, Effie Psalida, Pietro Garibaldi. 1998.
172. Capital Account Liberalization: Theoretical and Practical Aspects, by a staff team led by Barry Eichengreen and Michael Mussa, with Giovanni Dell’ Ariccia, Enrica Detragiache, Gian Maria Milesi-Ferretti, and Andrew Tweedie. 1998.
171. Monetary Policy in Dollarized Economies, by Tomás Baliño, Adam Bennett, and Eduardo Borensztein. 1998.
170. The West African Economic and Monetary Union: Recent Developments and Policy Issues, by a staff team led by Ernesto Hernández-Catá and comprising Christian A. François, Paul Masson, Pascal Bouvier, Patrick Peroz, Dominique Desruelle, and Athanasios Vamvakidis. 1998.
169. Financial Sector Development in Sub-Saharan African Countries, by Hassanali Mehran, Piero Ugolini, Jean Phillipe Briffaux, George Iden, Tonny Lybek, Stephen Swaray, and Peter Hay ward. 1998.
168. Exit Strategies: Policy Options for Countries Seeking Greater Exchange Rate Flexibility, by a staff team led by Barry Eichengreen and Paul Masson with Hugh Bredenkamp, Barry Johnston, Javier Hamann, Esteban Jadresic, and Inci Ötker. 1998.
167. Exchange Rate Assessment: Extensions of the Macroeconomic Balance Approach, edited by Peter Isard and Hamid Faruqee. 1998
166. Hedge Funds and Financial Market Dynamics, by a staff team led by Barry Eichengreen and Donald Mathieson with Bankim Chadha, Anne Jansen, Laura Kodres, and Sunil Sharma. 1998.
165. Algeria: Stabilization and Transition to the Market, by Karim Nashashibi, Patricia Alonso-Gamo, Stefania Bazzoni, Alain Feler, Nicole Laframboise, and Sebastian Paris Horvitz. 1998.
164. MULTIMOD Mark III: The Core Dynamic and Steady-State Model, by Douglas Laxton, Peter Isard, Hamid Faruqee, Eswar Prasad, and Bart Turtelboom. 1998.
163. Egypt: Beyond Stabilization, Toward a Dynamic Market Economy, by a staff team led by Howard Handy. 1998.
Note: For information on the title and availability of Occasional Papers not listed, please consult the IMF Publications Catalog or contact IMF Publication Services.
These estimates are based on the two countries’ national accounts using official exchange rates, which were well below parallel market rates in both countries.
Illiteracy in the PDRY was reduced from 97 percent in 1967, when the PDRY was formed, to 59 percent in 1985; at that point the YAR’s illiteracy rate was still 80 percent (Dunbar, 1992).
Shabwah was closed down in 1994 after disappointing results, mainly due to the inappropriate recovery methods introduced in the late 1980s.
See Arab Oil and Gas Directory, various issues; some information can also be found on the World Wide Web site of the Ministry of Oil and Mineral Resources (www.momr.gov.ye).
For example, contracts specified which activities would be undertaken in the exploration phase, such as the numbers of wells to be drilled and the kind and amount of seismic data to be produced and analyzed. Funds committed in the exploration phase, generally on the order of tens of millions of dollars, were also stated.
Cost oil is the amount recoverable by the operator per year to cover expenses during the appraisal and exploration period as well as operating costs.
As an illustration, assume that production is at 100,000 b/d, the share of cost oil is 50 percent, and profit sharing is 20—80 in favor of the government. The company then receives 50,000 b/d as cost oil plus 20 percent of the remaining 50,000 b/d, or 10,000 b/d, as profit, while the government receives 40,000 b/d.
The first was signed in September 1981 with the U.S. company Hunt Oil over a 16,890-square-kilometer area located in what was then North Yemen, in the onshore Tihama area (the Marib block). In addition to shares of cost oil and profit distribution, the terms of the agreement specified a 10 percent royalty to the government on the fraction of production in excess of 100,000 b/d. In September 1986 a consortium consisting of CanOxy and Athens-based Consolidated Contractors International Company was awarded two onshore tracts in the Masila region of South Yemen. These tracts, totaling 35,548 square kilometers, turned in the second most important oil findings in Yemen after Marib. In April 1987 the South Yemeni government awarded Total of France the 15,827- square-kilometer East Shabwa concession, located northeast of Aden. A consortium consisting of Total, Hunt Oil/Exxon, the Kuwait Foreign Petroleum Exploration Company (Kufpec), Mashino import, and Zarubezhgeologia signed an agreement in 1990 with the Yemeni Company for Investment in Oil and Mineral Resources for the exploration of Jannah, a tract of land in northern Yemen measuring 2,372 square kilometers, with a signature bonus of $6 million. The following year Nimir Petroleum Company (NPC) signed an exploration agreement for the Ayad block, also in northern Yemen, obtaining a much larger signature bonus of $27 million and a production bonus of $5 million at a rate of output exceeding 50,000 b/d. Oil had been found in the Ayad block earlier in the 1980s, but the company that held the concession at the time later relinquished it.
In the revised agreement with CanOxy, for example, costs would be recovered out of 50 percent of crude oil produced instead of the previous 28 percent. The original 10 percent flat royalty rate was replaced with a sliding scale, rising from 3 percent on production up to 25,000 b/d to 10 percent on production exceeding 100,000 b/d. Under its revised agreement, NPC would collect 70 percent of revenue generated on production up to 25,000 b/d as cost oil (instead of the previous 24 percent). Once that allocation has been made, the company would pay the government 3 percent as a royalty, and the remaining profit would be split evenly between NPC and the government. Similarly, in early 2000 the government finalized amendments raising companies’ profit share to the share in the production-sharing agreement with the Norwegian company DNO, which operates Howarim (Block 32).
Of these reserves, 413 million barrels are located in the Marib block, 1,410 million in the Masila block, 181 million in the Shabwah block, 281 million in the Jannah block, 107 million in the Ayad block, and 25 million in the Howarim block.
Masila is currently the country’s most productive block. Production there started in July 1993 at an initial rate of 40,000 b/d and by 1999 reached 207,000 b/d on average. CanOxy reported that operating costs of the Masila fields were under $1 a barrel in 1999; it also invested about $60 million in continued field development for that year. However, if no new discoveries are made, Masila’s production could begin to decline in 2001 by an average of 9,000 b/d a year. Marib, the country’s second-largest and oldest production field, peaked in 1994 at 185,000 b/d; average production has since declined at a rate of about 14,000 b/d a year. This trend decline is expected to continue over the medium term, albeit at a slower pace. Without further investment for secondary or tertiary extraction, Marib’s output could decline to levels below 40,000 b/d by 2005. Jannah is the most promising block of those that emerged in the late 1990s. Production started in 1996 at about 4,000 b/d and rapidly rose to reach 48,000 b/d in 1999. Output rose further, to about 68,000 b/d in 2001, and to keep on increasing annually by 5,000 to 6,000 b/d for the near term. Shabwa came on stream in December 1997, and its output is expected to reach 27,000 b/d in 2000, from a current level of 17,000 to 18,000 b/d. This increase is owed to the development of two recently discovered fields on its tract, and this new level should be sustained in the near term. Some production took place in the Ayad block from 1988 to early 1990, when Technoexport operated the block. NPC took over in 1991 and resumed production in 1992 at a low level of 5,000 b/d. The civil war in Yemen caused the suspension of NPC’s operations, and production (at a low rate of 1,000 b/d) resumed only in 1997, after amendment of the terms of agreement with the government. Given the difficult geological conditions in the Ayad tract, production is expected to decline steadily over the near term. Howarim, Block 32, is the sixth and latest block to produce oil in Yemen. As previously noted, it is operated by the Norwegian company DNO and came on stream in early 2001, with initial production from two wells in the Tasour field of about 5,000 to 7,000 b/d. Other exploration blocks (S1, S2, 9, and 15) yielded oil that added about 380 million barrels to recoverable reserves; production could start within a couple of years.
The formulas used by the two refineries differ. YPC pays the Marib refinery average monthly prices quoted on the Mediterranean market; however, it pays the ARC daily prices quoted by Platts Marketscan News from the Rotterdam market, plus a premium of $17 a ton. The premium supposedly reflects remuneration for shipping services but may also include an explicit subsidy to compensate for the refinery’s inefficiency
Data on government crude oil revenues for Egypt (measured by crude oil receipts of the state petroleum company) were not available for fiscal years 1989/90, 1991/92, and 1992/93 (the data reported in Figure 2 correspond to fiscal years). For both Syria and Yemen, the fiscal year is the same as the calendar year; for Egypt, 1990 refers to data for fiscal year 1989/90, and so on.
Unstable correlation patterns between trade price indices and output have often been observed in data for both developed and developing countries. For example, see Backus and Crucini (2000).
In other words, the terms-of-trade effect = NX/P – (X/Px – M/Pm), where NX is the nominal trade balance, P is a price deflator for the trade balance (the consumer price index is used here as a proxy), X and M are nominal exports and imports, respectively, and Px and Pm are their respective price deflators.
About 13.5 trillion cubic feet in the form of associated and nonassociated gas is concentrated in the Marib block; the rest is found in the Jannah block. Recent discoveries in Block S1 could add some 2 trillion cubic feet to this stock.
The debt of the former PDRY to the former Soviet Union was inherited by the unified Yemen and Russia, respectively.
Given the difficult external debt position, the government’s external borrowing policy was to avoid new borrowing on commercial terms, to carefully consider any new concessional borrowing, and to provide government guarantees only on supplier credits for food imports.
Debt obligations to the former CMEA creditors were viewed largely as “political” rather than “economic” debt.
External debt-service obligations during 1994-95 were estimated at $1.8 billion on a commitment basis, but only $205 million was paid.
The participating creditor countries were Denmark, France, Germany, Italy, Japan, the Netherlands, the United Kingdom, and the United States.
The 1996 agreement did not include late interest; by the end of 1996 this amounted to $542 million, 90 percent of which was owed to Russia.
By the end of 1996, the stock of Yemen’s external debt stood at $11.1 billion, or 173 percent of GDP, and the stock of external arrears reached $7.0 billion. Debt to Russia, evaluated at the loan contracting exchange rate of 0.6 ruble to the dollar, accounted for 62 percent of Yemen’s total debt and 77 percent of its amortization and interest arrears.
Determination of the rate of discount was based on the fact that Yemen is an IDA-only country (that is, it is eligible for World Bank Group borrowing only from that organization’s concessional lending affiliate, the International Development Association), for which Russia was the largest military creditor among the Paris Club creditors. Russia’s agreement to the discount was based on the official Soviet Gosbank exchange rate of 0.6 ruble to the dollar and a conversion rate of the transferable ruble (in which the original claims were denominated) of 1 ruble to the dollar.
As of the end of 1999, the bilateral agreements implementing the Agreed Minute had been signed with all Paris Club creditors except France.
This ensured comparable treatment with the official debts, included in the Paris Club agreement, owed by the government of Yemen to the Russian government. As a consequence, the effective buyback price for the “Russian debt” component of this operation was 2 cents on the dollar of the principal amount of eligible debt
Of this amount, $1 million was intended for incidental costs related to closing the operation, auditing the records, and protecting against exchange rate fluctuations.
Implementation of the commercial debt buyback operation would further reduce the stock of external debt-service arrears to $760 million, which represents arrears to non-Paris Club bilateral creditors from whom the Yemeni authorities have requested debt relief on terms comparable with those obtained from the Paris Club.
In this respect, the Yemeni experience differs from German unification. In Germany, practically all laws and regulations of the market economy of the Federal Republic of Germany were immediately adopted in the formerly centrally planned east, and many high-ranking East German civil servants lost their jobs.
At the end of 1994, the official rate of YRls 12.01 to the dollar was about one-eighth of the parallel rate of YRls 103 to the dollar.
Despite nominal increases on the order of 25 to 30 percent, wages did not keep pace with inflation, which accelerated from 34 percent to 71 percent in the same period. The fact that the wage bill as a share of GDP remained stable while real wages declined reflects the large differences between the GDP deflator and the consumer price index (CPI). The GDP deflator gave a higher weight to official transactions, recorded at the stable official exchange rate, than did the CPI. Comparisons with later years should be made cautiously because of substantial adjustments in the calculation of national accounts after the unification of exchange rates.
The informal financial market was dominated by moneychangers, the largest of whom accepted deposits from the public (see Section IV).
As a result, the government is now indifferent between exporting oil and selling it to domestic refineries; meanwhile the implicit consumption and production subsidies have become transparent cash subsidies.
For example, a ceiling on credit growth was set at 50 percent in 1996, a year in which credit actually fell. In early 1997 credit growth ceilings were once more set at 25 percent, and again these ceilings were not binding. The central bank has not renewed these ceilings since then, but prefers to keep open the option to impose new ceilings should extreme circumstances warrant them.
Estimates of recoverable resources vary widely and are changing rapidly. In particular, a recent treaty settling border issues with Saudi Arabia may boost exploration activity and thus the likelihood of discovering additional resources. The following discussion should therefore be interpreted as only illustrative of broad orders of magnitude.
A discussion of the relationship between sustainability and government investment policies can be found in Easterly and Fischer (1990).
Pindyck (1999) was able to reject the unit root hypothesis only after considering more than 70 years of data. Cashin, Hong, and McDermott (1999) find that petroleum price shocks are infinitely persistent. A survey of the stochastic properties of oil prices can also be found in Engel and Valdes (2000).
This assumes that a government is neither more nor less impatient to consume resources than implied by the interest rates prevailing on international capital markets.
At 1999 wealth levels, assuming annual total factor productivity (TFP) growth of 1 percent would add about 1 percent of GDP to sustainable consumption. However, during the 1990s estimated TFP growth was negative (see Section VI).
The reasoning is as follows: oil wealth is evaluated at world market prices and, hence, domestic consumption depletes that wealth by the volume consumed evaluated at world market prices, not at administered prices.
The incentive rate was increased to YR1s 25 to the dollar on July 1, 1993, and imports by the government and public sector enterprises, as well as imports of LPG, were moved to the parallel market. Subsequently, commercial banks were allowed to operate in the parallel market on behalf of their customers, but this permission was withdrawn on June 7, 1994, with the objective of containing the depreciation in the parallel market.
In addition, there was a diplomatic rate of YR1s 5 to the dollar for staff working in Yemeni embassies abroad.
Importers of wheat and flour were required to purchase foreign exchange at the free market rate, and payment of a rial subsidy to the importers was made by the Ministry of Finance upon transfer of ownership of the imported wheat to domestic distributors. The rial subsidy was eliminated in June 1999.
Available information indicates that neither the central bank nor other market participants are involved in forward or derivative operations.
A positive import list is one in which only those items listed may be imported; a negative list is one in which only those items listed may not be imported.
The only exceptions were the importation of equipment by foreign oil companies; the importation of spare parts to meet emergency needs of manufacturing enterprises, subject to an annual limit of $50,000 for each enterprise; and the importation of machinery and spare parts worth up to $40,000 by Yemeni nationals returning from abroad to set up a small business. In the latter case, authorization from the Ministry of Supply and Trade was required, and the payment had to be made out of expatriated foreign exchange savings.
In addition to coffee, import bans continued to apply to 21 categories of fruit and vegetables classified according to the four-digit Harmonized Nomenclature System code, introduced in October 1997. Importation of the following items was prohibited for security, religious, or environmental reasons: weapons and explosives, narcotics, pork and pork products, alcohol, and rhinoceros horn.
A special tariff rate of 70 percent applied to tobacco and tobacco products for revenue reasons.
Export licensing is required for statistical purposes, and the Ministry of Fisheries limits the export of certain categories of seafood products. Exports of antiques and archeological items exceeding $100 in value are prohibited
See IMF (1997) for a description of the methodology for deriving the trade restrictiveness index.
Tax regimes for oil companies, the major foreign investors, were negotiated separately and individually and were not covered by the income tax laws.
Presidential Decrees No. 12 and 255 of 1999; these also included a provision for the taxation of rental income, but the tax was limited to one month’s rent.
In addition to wheat and wheat flour, the Yemeni government subsidized rice, milk, sugar, and medicine. These subsidies were relatively unimportant in magnitude and were eliminated in 1995.
The government was still engaged in settling some remaining arrears with wheat importers in early 2000.
Since the removal of the wheat subsidy, the amount of foreign exchange sales by the central bank has not exceeded $200 million a year, compared with the direct provision of $400 million to $600 million annually to wheat importers before wheat imports were liberalized. At the same time, wheat imports have declined by about $100 million a year relative to their preliberalization levels. This suggests that, as a result of the subsidy, between $100 million and $300 million a year was accruing as rents to wheat importers and distributors, probably in the form of over invoicing and smuggling to neighboring countries, where the price of wheat was higher.
The subsidized exchange rate equalized the administered predistribution price with the actual price of imported wheat at the port of entry.
The minister of transport has reported that these by-laws are already being implemented; trucking licenses are being granted to all applicants with adequate equipment.
World Bank Country Development Report, Phase I, “Judicial and Legal System Building Block.”
Such committees have already been established in various ministries (agriculture, supply and trade, and industry), as these have already carried out the privatization of some of the enterprises under their jurisdiction.
These ratings relate to international banks. This regulation will be modified to include local banks once a local rating system is in place.
Saudi Arabia is included as a comparator because it is a neighboring country; Egypt and Jordan were selected because these countries have close relations with Yemen; Pakistan was selected because, like Yemen, it is eligible to borrow from the Poverty Reduction and Growth Facility; and the United Kingdom was selected as a representative industrialized country.
Between 1997 and 1999 the operations of the private and the public funds were merged. After expected cost reductions could not be realized and private sector compliance fell, the merger was reversed in 1999.
The poverty line for an individual was estimated at YR1s 2,600 per month in 1999.
The managing director is also a member of the board, and the office of the managing director acts as its secretariat.
For example, the SFD provided management and skills training in accountancy for 68 agricultural cooperatives in the governorates of Sana’a and Ibb, in close cooperation with the Federation of Agricultural Cooperatives.
For example, the SFD provided the SWF with technical assistance in developing a new survey to determine eligibility, establishing an electronic database of beneficiaries, and acquiring skills in relevant software to maintain this database.
The SFD insists on a participatory process in most of its projects: local communities participate both in defining the needs and in setting up and running the projects. Sometimes their contribution extends to 50 percent of the project’s design and implementation work.
The SFD pays particular attention to females and juveniles; for example, in 1998 a project to improve the living conditions of jailed women was implemented. A school was established in the central jail to provide literacy classes and skills training. The SFD took juveniles out of the central jail and placed them in a hostel. Civil orphan hostels were also established, and there are projects under way to institute seven hostels for boys and girls. Of all the microenterprise development projects implemented so far, more than 50 percent targeted women, and more than 60 percent were in rural areas
Some SFD projects (in education, for example) are implemented at a third of what it would cost the government to implement, and at a much quicker pace. For the building of schools it now provides efficiency benchmarks for outside government contracts.
This faster-than-expected growth of the SFD’s programs forced it to shorten its first operational phase from five years to three and to apply for a larger ($100 million) grant from the World Bank to finance a second five-year phase of operations
Most of the SFD programs are based on Islamic banking, for consistency with the tradition and expectations of the concerned communities.
Rural community organizations in North Yemen were first known as Local Development Agencies. They were funded by private donations, zakat, and remittances and had a large degree of autonomy. Law No. 12 of 1985 reduced that autonomy by transferring the power and responsibility to provincial governors and reorganizing the cooperatives into the Local Councils for Cooperative Development.
These institutions raise money from the government as well as from individuals and businesses. There are, however, no clear guidelines dictating the extent of government assistance, which is then administered on an apparently ad hoc basis, and bilateral international assistance to these institutions is still limited.
Despite improvements in the methodology underlying the national accounts compiled by the Central Statistics Organization of Yemen (CSO), GDP figures remain unreliable, largely because of a lack of basic underlying data in many areas, as well as a lack of adequate deflators for all components of GDP. Moreover, the existence of a multiple exchange rate system before 1996 probably biases the data for 1990-96 downward, as these may overstate the importance of transactions at the highly overvalued official exchange rate. In the absence of alternative data sources (except for the oil sector), official CSO data are used as the base for assessing broad trends in various sectors of the economy.
Locally grown wheat is traditionally viewed by Yemenis as having higher quality and better taste than imported wheat, which creates demand for it despite its higher price; this might have mitigated the adverse effect of import subsidies on local production.
These were mostly farms that were returned to their past owners after having been nationalized by the socialist regime in the south.
For example, the rapid spread of the Newcastle disease among the country’s livestock in the last quarter of 1999 was halted by the government, which brought the percentage of livestock infected down from about 26 percent in December 1999 to less than 4 percent in February 2000.
Available information is based primarily on the 1994 Population Census; other sources include the Household Expenditure Survey of 1998, the Demographic Survey of 1997, and the Educational Survey of 1998-99. All these surveys were not primarily designed to collect detailed information on the labor market. The CSO for the first time conducted a detailed labor market survey in 2000.
Results from the 1998 household survey indicate that the average age at first marriage for women is 20 years.
According to the 1998 household survey, the female illiteracy rate is 71 percent, compared with 24 percent among men.
According to a report by the United Nations Development Programme and the Yemeni Ministry of Planning (UNDP and Ministry of Planning, 1999), registered graduates on the waiting list at the Ministry of Civil Service and Administrative Reform totaled 15,400 at the end of June 1999. Of these, 51.3 percent held degrees in education; 20.5 percent in arts, science, information, religious studies, and law; 9.8 percent in business and economics; 9.6 percent in medicine; and 8.8 percent in engineering, agriculture, computing, and petroleum. In 1999 available government jobs were distributed among education (79.1 percent), health (9.2 percent), other administrative units (6.5 percent), and various positions at other public sector units (5 percent).
Since 1981 the minimum wage has been set at YR1s 6,000 a month, but apparently this has never been enforced.
CPI data are compiled by the CSO. In January 1995 a new series was introduced, consisting of a weighted average of the price indices for Sana’a and Aden, where the weights correspond to consumption shares obtained from the 1992 Household Budget Survey. Before that the CPI was based on series from five major cities, using data from the 1977/78 Household Budget Survey, but weighted across cities by population share. Despite the improvement underlying the CPI introduced in 1995, these data remain weak because of poor price collection and absence of monitoring, as well as insufficient coverage. Current efforts are concentrated on producing yet another CPI, covering 20 cities and using new consumption shares derived from the 1998 Household Budget Survey.
It is assumed that the effect of administrative prices is captured by the transportation price index (because it partly accounts for petroleum product prices), the fuel and lighting price index (because it partly accounts for petroleum product prices and electricity tariffs), and the cereals price index (because it includes wheat prices). This might not be a precise measure, given that information on individual items within these categories is not available (and these categories certainly include other items not subject to price setting). Figure 17 indicates, however, that changes in administered prices seem to be reflected in these categories to an extent sufficient to warrant the assumption. Hence in this section the CPI excluding administrative prices refers to the CPI calculated after excluding these items.
The HDI is an index constructed annually by the UNDP since 1990 to measure average achievement in basic human development. The indicators used in calculating the HDI include life expectancy, educational attainment (measured through literacy and enrollment rates), and income per capita.
Sources of the data cited in this section are the 1998 Household Budget Survey of the CSO supplemented by the UNDP Poverty Policy Framework for Yemen, the World Bank 1996 Poverty Assessment Report (World Bank, 1996), the IMF World Economic Outlook database, the 1998 CSO Statistical Yearbook, (CSO, 1998), and the World Bank’s World Development Indicators.
The UNDP estimated the food poverty gap—the difference in spending on food between poor and the poverty line (approximated by spending by the nonpoor)—at $160 million a year, or 2 percent of GDP, in 1998.
Hashem (1996) reports that 13 percent of the population moved from rural to urban areas between 1992 and 1994. This heavy migration may be due not only to job hunting but also to a search for better living conditions.
The 1996 World Bank Poverty Assessment Report (World Bank, 1996) estimated the numbers of the first three groups at 100,000, 10,000, and 100,000, respectively.
The World Bank Poverty Assessment Report mentions that less than 17 percent of government subsidies benefited the poorest 20 percent of the population in 1995.
Weaknesses in the investment environment include ineffective commercial courts, poor enforcement of contracts and land ownership rights, lack of understanding and familiarity with commercial law, poor infrastructure, lack of skilled labor, and governance problems in the public administration.
See The Economist, April 10, 1999, page 61
See Yemen—A Travel Survival Kit, Lonely Planet Publications, January 1996, page 87.
See Business Middle East, January 1, 2000, The Economist Intelligence Unit, page 11.
See Yemen—Consular Information Sheet, September 14, 1999, U.S. Department of State website, http://travel.state.gov/yemen.html, and Business Middle East, February 1, 1999; The Economist Intelligence Unit, page 10.
See Yemen—Travel Warning, November 5, 1999, U.S. Department of State website, http://travel.state.gov/yemen warning.html.
Preliminary estimates suggest that, as a result, tourist arrivals in 1999 declined by about 35 percent relative to 1998 and tourism foreign exchange receipts stood at less than 60 percent of their 1998 level. The two largest hotels in Sana’a have seen their occupancy rates drop below 50 percent, and Yemenia Airlines was reported to have lost more than US$2 million in revenues.
Currently, there are about 250 hotel establishments offering some 7,700 rooms.
The potential absorptive capacity of the tourism sector in Yemen is rather limited. According to local businessmen, existing historic and scenic attractions can potentially accommodate no more than 150,000 visitors a year. This requires the tourism sector to be oriented towards low volumes and high yields, attracting the more affluent category of international tourists. These are mostly senior citizens in the middle and higher income groups, who require more comfortable accommodation than younger and more adventurous backpackers.
The most recent examples of the latter include the proposed construction of Burum Port, 20 km southwest of Mukalla, and a gas pipeline through a white sand beach at Bir Ali.
Three kidnappers in the 1998 case, including the group leader, were sentenced to death by the court and have been executed.
According to a local observer, there is currently a lot of duplication and a lack of coordination the various government and public entities involved in the tourism sector, some of which also appear to be overstaffed and lack the technical capability to carry out their statutory obligations satisfactorily