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21. Addressing the Crushing Weight of Yemen’s Public Debt

Author:
Sana'a Center Economic Unit
Publication Date:
07-2022
Content Type:
Policy Brief
Institution:
Sana'a Center For Strategic Studies
Abstract:
For decades prior to the ongoing conflict, Yemen had been vulnerable to recurring budget deficits due to a lack of meaningful fiscal reform, high recurrent expenditures – mainly public sector salaries and fuel subsidies – and an overdependence on oil revenues. While foreign debt obligations remained low, the debt market was poorly diversified, with treasury bill holders narrowly concentrated within the banking sector and government bonds held almost exclusively by public pension funds. The escalation of the ongoing conflict in 2015 has had a profoundly negative impact on Yemen’s debt position. Large-scale oil exports ceased, leading to a collapse in public revenues, while banks and pension funds stopped purchasing government debt instruments. Management of the public debt became bifurcated between rival central bank administrations in Aden and Sana’a, both of which suspended payments on foreign and domestic debt obligations. Unable to receive interest payments, public debt holders faced a liquidity crisis, leaving banks unable to honor customer obligations and threatening their solvency, while pension funds have struggled to support retirees. On January 25-27, 2021, senior Yemeni experts and professionals convened virtually for the 7th Development Champions Forum (DCF), as part of the Rethinking Yemen’s Economy initiative, to discuss the evolution and structure of Yemen’s public debt, the dynamics during the conflict that have led to its colossal expansion, and the macroeconomic risks it poses. This was followed a week later with a briefing for international stakeholders on February 2. These discussions formed the basis for the research presented in this paper and its recommendations for addressing Yemen’s public debt crisis. Addressing the Crushing Weight of Yemen’s Public Debt - Sana'a Center For Strategic Studies https://sanaacenter.org/publications/main-publications/18247
Topic:
Budget, Economy, Armed Conflict, and Public Debt
Political Geography:
Middle East, Yemen, and Gulf Nations

22. Impacts of the War on the Telecommunications Sector in Yemen

Author:
Mansoor al-Bashiri
Publication Date:
01-2021
Content Type:
Policy Brief
Institution:
Sana'a Center For Strategic Studies
Abstract:
The telecommunications and information technology sector in Yemen is a vital component of the country’s infrastructure and plays a critical role in economic growth. It is the second largest source of public revenue after the petroleum sector, and contributes important work opportunities, whether directly or indirectly, through its connections to other sectors of the national economy. From 2015 to 2019, the sector’s performance has varied due to the extraordinary circumstances Yemen has been going through. It is estimated that the conflict has caused about $4.1 billion in direct financial losses for the telecommunications sector due to electricity outages (at times caused by a lack of fuel), institutional fragmentation, and competing policies and financial demands by the authorities in Sana’a and Aden, as well as confiscation of assets and extortion. The sector has also lost a number of opportunities that may have otherwise been available if it were not for the outbreak of the conflict, like the development of licensing agreements and the progression to 4G technology. Investors in the telecommunications sector have been deterred from the Yemeni market despite its large size and the fact that many services are not currently being provided by the companies operating in the sector. The sector faces a large number of challenges, the most serious of which are: the unsuitability of the legal and institutional regulatory environments; fragmentation of public entities in the sector; unproductive accusations made by the parties to the conflict; the lack of separation between political, regulatory and operational roles within the sector; and the reliance on a weak and fragile infrastructure to provide these services. Other challenges include the restrictions imposed on importing equipment, difficulty accessing a number of districts and entire governorates to carry out necessary repairs, declining revenues for the companies, and the increase of fees being levied by both the authorities in Sana’a and in Aden, compounded by the population’s general impoverishment and limited purchasing power. To strengthen the role of Yemen’s telecommunications, there must be efforts in the short term to depoliticize the sector during the conflict, repair operator networks, introduce new services (such as video conferencing and digital financial services), and work to lower internet tariffs—this paper does not provide an analysis of how to achieve a viable mix of upgraded services and affordable prices while still maintaining the feasibility of new investments. In the medium and long term, efforts to draft new telecommunications laws must continue, in addition to separating regulatory and operational roles, developing the regulatory and institutional environment, encouraging private investment, and updating educational programs and university curricula to ensure that they are up-to-date with ongoing developments in the field of telecommunications and information technology. These curricula and programs must meet the local market’s needs for specialized labor.
Topic:
Economic Growth, Conflict, Information Technology, and Telecommunications
Political Geography:
Middle East and Yemen

23. Solar-Powered Irrigation in Yemen: Opportunities, Challenges and Policies

Author:
Musaed M. Aklan and Helen Lackner
Publication Date:
04-2021
Content Type:
Policy Brief
Institution:
Sana'a Center For Strategic Studies
Abstract:
Yemen is one of the most water-scarce countries in the world, with renewable water resources currently capable of providing only 75 m3 per capita per year – well below the water scarcity threshold. And this volume is steadily dropping. The agricultural sector in Yemen is the dominant user of groundwater resources, accounting for around 90 percent of total consumption. Due to the current crisis, fuel required for pumps has become scarce and very expensive; as a result, solar energy has begun to play a role in the extraction and supply of groundwater for irrigation. However, there is concern about the misuse of this new technology. This study examines the current trend of solar-powered irrigation system (SPIS) use in Sana’a Basin, identifying the pros and cons of this approach. It presents the perspectives of farmers and experts in terms of what is happening and what should be done to maximize the benefits and minimize the negative impacts of SPIS. The incidence of SPIS installation is increasing at a rate of more than 4 percent annually. Farmers spoken to as a part of this study expressed enthusiasm to use SPIS and cited capital cost as the biggest obstacle to their acquiring this technology. This paper proposes governance and policy recommendations for overall water management and, in particular, for future studies and regulation of SPIS-driven groundwater use. Setting appropriate policies for water-pumping powered by renewable energy will help to conserve groundwater sources and sustainably preserve livelihoods.
Topic:
Agriculture, Water, Renewable Energy, Solar Power, and Irrigation
Political Geography:
Middle East and Yemen

24. Local Economic Councils: A Tool to Improve Business Productivity in Yemen

Author:
Sana'a Center for Strategic Studies
Publication Date:
09-2021
Content Type:
Policy Brief
Institution:
Sana'a Center For Strategic Studies
Abstract:
Even before the events of 2014 and 2015 that led Yemen into the ongoing civil war, its economy was fragile. The years of hardship that have haunted the country ever since have been devastating. Yemen is now rated as one of the hardest places in the world for businesses to operate and is last or near last in a host of global business competitiveness indexes. From January 25-27,2021 the seventh Development Champions Forum, held virtually, focused on this dire national situation. To help address local economic challenges, the Development Champions discussed the possibility of establishing Local Economic Councils. According to their analysis, between the existing community-level local development committees (which guide targeted, small scale infrastructure investment from development funds such as the Social Fund for Development and the World Bank) and the Supreme Economic Council (which guides sector-led state investment at a national level), a space exists for a governorate-level body to drive development by guiding investment to serve local needs and strengthen ties between the governorates and the private sector.
Topic:
Development, Economy, Business, Conflict, and Local Councils
Political Geography:
Middle East and Yemen

25. Priorities for the Recovery and Reform of the Electricity Sector in Yemen

Author:
Akram M. Almohamadi
Publication Date:
11-2021
Content Type:
Policy Brief
Institution:
Sana'a Center For Strategic Studies
Abstract:
Electricity is the backbone of any economy and one of the necessities of modern life. Since even before the current war, poor electricity services in Yemen have been one of the key barriers to sustainable economic development and basic service provisions, such as water supply, health care, and education. This policy brief presents an overview of the electricity sector and its relevant indicators prior to the conflict. It then outlines the impact of the conflict on the sector, and concludes with a set of priorities for restoring the pre-war capacity of the electricity sector, then further reforming it to improve its performance. Immediate- to short-term recommendations include: adopting a realistic and practical recovery plan; securing funds for rehabilitating the infrastructure; reviewing the electricity tariff; reducing technical and non-technical electricity losses; purchasing electricity when needed through a competitive process and via least-cost options, such as gas and renewable energy; securing the fuel supply and the salaries of sector staff; resuming all suspended projects; finding sustainable and feasible solutions for the electricity supply in each governorate to avoid the challenges associated with the centralized grid; and installing sustainable stand-alone solar systems, compatible for connection to the national grid (when restored). The medium- to long-term priorities include specific recommendations under five categories, relating to: the legal and regulatory framework; institutional arrangements; capacity and performance; private sector participation; and technical issues. This policy brief was developed based on a more detailed research paper published under the same title by Rethinking Yemen’s Economy project in May 25, 2021.
Topic:
Reform, Economy, Conflict, Electricity, and Energy Sector
Political Geography:
Middle East and Yemen

26. A Decade After the Uprising – The Yemen Review, March-April 2021

Author:
Sana'a Center for Strategic Studies
Publication Date:
05-2021
Content Type:
Commentary and Analysis
Institution:
Sana'a Center For Strategic Studies
Abstract:
The Yemen Review Launched in June 2016, The Yemen Review – formerly known as Yemen at the UN – is a monthly publication produced by the Sana’a Center for Strategic Studies. It aims to identify and assess current diplomatic, economic, political, military, security, humanitarian and human rights developments related to Yemen. In producing The Yemen Review, Sana’a Center staff throughout Yemen and around the world gather information, conduct research, hold private meetings with local, regional, and international stakeholders, and analyze the domestic and international context surrounding developments in and regarding Yemen. This monthly series is designed to provide readers with a contextualized insight into the country’s most important ongoing issues
Topic:
Diplomacy, Geopolitics, Conflict, and Uprising
Political Geography:
Middle East and Yemen

27. Wanted: A Peacemaker Who Can Deliver – The Yemen Review, May 2021

Author:
Sana'a Center for Strategic Studies
Publication Date:
06-2021
Content Type:
Commentary and Analysis
Institution:
Sana'a Center For Strategic Studies
Abstract:
The Yemen Review Launched in June 2016, The Yemen Review – formerly known as Yemen at the UN – is a monthly publication produced by the Sana’a Center for Strategic Studies. It aims to identify and assess current diplomatic, economic, political, military, security, humanitarian and human rights developments related to Yemen. In producing The Yemen Review, Sana’a Center staff throughout Yemen and around the world gather information, conduct research, hold private meetings with local, regional, and international stakeholders, and analyze the domestic and international context surrounding developments in and regarding Yemen. This monthly series is designed to provide readers with a contextualized insight into the country’s most important ongoing issues
Topic:
Conflict Resolution, Governance, Negotiation, and Peace
Political Geography:
Middle East and Yemen

28. The View from Sana’a – The Yemen Review, Summer Edition, July 2021

Author:
Sana'a Center for Strategic Studies
Publication Date:
08-2021
Content Type:
Commentary and Analysis
Institution:
Sana'a Center For Strategic Studies
Abstract:
The Yemen Review Launched in June 2016, The Yemen Review – formerly known as Yemen at the UN – is a monthly publication produced by the Sana’a Center for Strategic Studies. It aims to identify and assess current diplomatic, economic, political, military, security, humanitarian and human rights developments related to Yemen. In producing The Yemen Review, Sana’a Center staff throughout Yemen and around the world gather information, conduct research, hold private meetings with local, regional, and international stakeholders, and analyze the domestic and international context surrounding developments in and regarding Yemen. This monthly series is designed to provide readers with a contextualized insight into the country’s most important ongoing issues
Topic:
Diplomacy, Politics, Economy, and Conflict
Political Geography:
Middle East, Yemen, and Saudi Arabia

29. New Fronts in the Economic War – The Yemen Review, August 2021

Author:
Sana'a Center for Strategic Studies
Publication Date:
09-2021
Content Type:
Commentary and Analysis
Institution:
Sana'a Center For Strategic Studies
Abstract:
The Yemen Review Launched in June 2016, The Yemen Review – formerly known as Yemen at the UN – is a monthly publication produced by the Sana’a Center for Strategic Studies. It aims to identify and assess current diplomatic, economic, political, military, security, humanitarian and human rights developments related to Yemen. In producing The Yemen Review, Sana’a Center staff throughout Yemen and around the world gather information, conduct research, hold private meetings with local, regional, and international stakeholders, and analyze the domestic and international context surrounding developments in and regarding Yemen. This monthly series is designed to provide readers with a contextualized insight into the country’s most important ongoing issues
Topic:
Foreign Aid, Economy, Conflict, and Banks
Political Geography:
Middle East and Yemen

30. Houthis at the Gates of Marib – The Yemen Review, January-February 2021

Author:
Sana'a Center for Strategic Studies
Publication Date:
03-2021
Content Type:
Commentary and Analysis
Institution:
Sana'a Center For Strategic Studies
Abstract:
The Yemen Review Launched in June 2016, The Yemen Review – formerly known as Yemen at the UN – is a monthly publication produced by the Sana’a Center for Strategic Studies. It aims to identify and assess current diplomatic, economic, political, military, security, humanitarian and human rights developments related to Yemen. In producing The Yemen Review, Sana’a Center staff throughout Yemen and around the world gather information, conduct research, hold private meetings with local, regional, and international stakeholders, and analyze the domestic and international context surrounding developments in and regarding Yemen. This monthly series is designed to provide readers with a contextualized insight into the country’s most important ongoing issues.
Topic:
Government, Politics, Conflict, and Houthis
Political Geography:
Middle East and Yemen