Yemen set to receive US $96M development loan from World Bank

Yemen's rich trade history to benefit from World Bank loan with a view to creating new jobs, increasing growth and bringing back investment.

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By  John Irish Published  February 3, 2003

In the hope of restoring some of Yemen’s historical affinity to international trade, the World Bank endorsed on January 23, 2003, a new three-phase initiative to be carried out over 12 years at a total estimated cost of US $96 million. An initial loan of $23 million will be used to help boost investment, encourage growth and create jobs in Yemen’s port cities of Aden, Hodeidah and Mukalla.

“With a gross national product per capita of US$460, Yemen’s 18.5 million people remain among the poorest in the world. About 42% of households live below the poverty line, and approximately 25% are unemployed or underemployed,” the World Bank said in a statement.

In the current political climate, Yemen is finding it increasingly difficult to create an investor friendly environment, while still needing to reduce its dependence on depleting oil reserves.

The Port Cities Development Program will first concentrate on Aden, Yemen’s commercial hub, by gradually focusing on the development of government infrastructure. The plan will comprise of a comprehensive overhaul of administrative techniques, including the automation of business transactions and the introduction of more information and communication technologies.

It will also attempt to initiate small-scale infrastructure investments by improving facilities such as fish markets and road works with the hope of fuelling small business growth and expanding existing transport facilities.

“At these difficult moments for the country, this program serves to remind everyone of the tremendous potential of Yemen. It is a reminder of Yemen’s rich trading culture, its fantastic locational advantage, and its ability to plan long term for its future development,” said Omar Razzaz, World Bank country manager for Yemen.

With Yemen’s strategic location at the tip of the Arabian Peninsula, there is great scope for development of all its ports. The World Bank hopes that an economic development strategy for Yemen’s three largest port cities will capitalise on their comparative advantages, such as transhipment and vessel servicing in Aden, agro-industries in Hodeidah and fisheries in Mukalla.

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