By NY Staff
For the first time since 1990, the Yemeni economy is about to collapse. The situation of the Yemeni economy worsened with the deterioration of the security and political situation as well as the absence of law.
Despite of the challenges and difficulties that the economy has faced, the Central Bureau of Statistics estimated the rate of the gross domestic product (GDP) as 2.82% in 2014. However, economists say that this rate doesn’t achieve the aims of economic growth, especially because the plan aimed to achieve at least 6% to help the failure of the economic growth.
According to economists, the decline in economic growth was a result of the economic decline in 2011, where the GDP declined to 15.1%. The decline of the GDP from 2011 to 2014, with the increasing rate of population growth to 3%, led to the decline of GDP to 9.1% from its level in 2010.
The large and continuing decline of domestic crude oil production and prices in the international market have caused more pressure on the Yemeni economy, especially with the inability of economic activities to make up the shortfall in oil export revenues as well as the increase of the national economy’s dependence on private oil derivatives and commodities in general.
According to recent statements, Yemen’s losses are due to the decline of oil prices from $115 for a barrel to $60, which negatively affect the public treasury proceeds of public resources and the proceeds of the national economy. This has led to depletion of the reserves of the banking system, especially the Central Bank.
According to the Statistics of the Central Bank, the government’s share of oil reached to $1.4 billion from January to October 2014, compared with $2.4 billion in 2013.
The statements explained that there is a decrease in the exported quantities, where only 13.8 million barrels have been exported, compared with 24.3 million barrels in 2013.
International Statistics revealed a deterioration accompanying the business environment in Yemen’s economic activities, where they declined from 129th place in 2013 to 133th place in 2014. Foreign investment faced a noticeable decline.
The investment environment in Yemen still suffers from many managerial obstacles as well as the instability in the security situation due to poor application of the law in many areas around the country.