Chapter

REPUBLIC OF YEMEN

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2000
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Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: December 10, 1996.
Exchange Arrangement
CurrencyThe currency of the Republic of Yemen is the Yemeni rial.
Exchange rate structureUnitary.
Classification
Independently floatingThe exchange rate of the Yemeni rial is determined by supply and demand.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketNo.
Arrangements for Payments and Receipts
Prescription of currency requirementsNo.
Payment arrangementsNo.
Administration of controlExchange control authority is vested with the Central Bank of Yemen (CBY).
International security restrictionsNo.
Payment arrears
OfficialYes.
PrivateYes.
Controls on trade in gold (coins and/or bullion)No.
Controls on exports and imports of banknotes
On exports
Domestic currencyExports of rial banknotes are prohibited.
On imports
Domestic currencyImports of rial banknotes are prohibited.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency convertible into foreign currencyYes.
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsYes.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for imports
Letters of creditYes.
Import licenses used as exchange licensesAll importers holding an import license for wheat or flour may obtain the necessary foreign exchange from the CBY. This system was eliminated on January 30, 1999.
Import licenses and other nontariff measures
Negative listSome imports are banned for security and religious reasons, and three categories of goods are banned for economic reasons. Imports from Israel are prohibited, as well as certain types of used machinery.
Open general licensesYes.
Import taxes and/or tariffsCurrently, there are four tariff rates: 5%, 10%, 15%, and 25%.
State import monopolyImports of petroleum products are reserved for the Yemen Petroleum Company.
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesExports are registered for statistical purposes. Exports to Israel are prohibited.
Export taxesNo.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
Investment-related paymentsInformation is not available on the payment of amortization of loans or depreciation of direct investments.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
Capital Transactions
Controls on capital and money market instrumentsNo.
Controls on derivatives and other instrumentsNo.
Controls on credit operations
Commercial credits
To residents from nonresidentsYes.
Financial credits
To residents from nonresidentsShort-term foreign loans by the public sector are prohibited. Approval by the Council of Ministers is required for contracting medium- and long-term foreign loans by the public sector.
Guarantees, sureties, and financial backup facilities
To residents from nonresidentsYes.
Controls on direct investmentNo.
Controls on liquidation of direct investmentLiquidation of direct investments is free for approved and registered projects.
Controls on real estate transactionsNo.
Controls on personal capital movementsNo.
Provisions specific to commercial banks and other credit institutions
Differential treatment of deposit accounts in foreign exchangeForeign exchange deposits held at the CBY are nonremunerated.
Open foreign exchange position limitsCommercial and specialized banks are required to observe prudential regulations regarding currency exposure and to report their positions.
On resident assets and liabilitiesYes.
On nonresident assets and liabilitiesYes.
Provisions specific to institutional investorsNo.
Other controls imposed by securities lawsNo.
Changes During 1999
Imports and import paymentsJanuary 30. The importation of wheat and flour was liberalized.

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