Business

Yemen Loses 1.5 Trillion YR Due To Destructive Acts

National Yemen

By NY Staff

2014 in Yemen was described as a year of vandalism, where the oil and gas pipelines, electricity pylons, and oil facilities were exposed to large numbers of attacks. These attacks caused a big loss for Yemen and its public treasury, reaching about 1.5 trillion riyals, 92% from the total net deficit in 2014.

Economists confirmed that electricity and oil pipelines are the main reasons behind the investment boom and attracting the capital in the country. Attacking the service installations led to the contraction of investment and the migration of businessmen.

The Central Bank of Yemen announced the decline of Yemen’s oil exports to more than six million barrels during 9 months in 2014, compared with the same year of 2013.

According to the Central Bank’s report, Yemen’s share of oil exports recorded $1.3 billion from January to September 2014, with a decline reaching $660 million compared with the same period in 2013 due to frequent attacks on oil pipelines and the decline of the production quantity.

The destructive acts and declining productive capacity for a number of oil wells have caused the decline of the allocated production quantities of domestic consumption to 14.5 million barrels with a decline reaching 2.5 million barrels in 2013.

The bank’s report added that the government has resorted to importing large quantities of oil products from abroad by more than $1.6 billion during the period from January to September 2014 in order to cover the market needs for fuel.

The General Manager of Transport and Conversion in the Ministry of Electricity and Energy, Abdulwasea al-Qudsi, said that the attacks of the electricity network reached 78 from January to November last year, while the repairs cost 155.5 million riyals, 105 million riyals for spares, and 3.2 billion riyals for the stopped power of Safer in the same period.

Al-Qudsi confirmed that the electricity needs to develop and rebuild the infrastructure of the system, such as implementing the transportation project in Sana’a, Dhamar, Ibb, Taiz, and Aden, adding to the establishment of the main and sub switching stations in Taiz and Sana’a where the transmission line passes.

A study was conducted by the Research Center of Economic Development revealed that there are about 80,000 facilities in Sana’a, 50% of it have generators which means that about 50,000 generator were imported by hundreds of millions of dollars, using fuel of 150 million riyals a day (about 54 billion riyals a year) to operate the generators. These amounts equal twice the electricity revenues in Sana’a.

Economic analyst Abdul Rahman al-Qawsi said that giant central stations must be established in all Yemeni provinces to stop buying the power from sea, which costs a lot of money and affects the national economy.

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