2005: Year for exports [Archives:2005/810/Business & Economy]
By Abdulaziz Abdullah
For The Yemen Times
To overcome the deficit in the commercial balance, which often reflects the gap between exports and imports, is the most challenging obstacle for a country, including Yemen. This is more important in our case since we depend mainly on crude oil as an export, yielding some 90-95% of the state's total exports during 1999-2002, while the remaining percentage represents other exports agricultural, fishery, and industrial.
The reliance on oil for revenues is very hazardous and it is very vital to stress the importance of formulating a strategy to develop exports of non-oil sectors and diversify our financial resources. We should always remember that any downward change in the price of oil would result in a real disaster, because the deficit rate will increase. The dire consequences will affect other economic areas such as the payment balance, inflation rate, and economic growth rate.
To avoid any economic results in the future resulting from unpredictable changes in the international oil markets, and to stop capitalizing on oil as the main and only export, we should focus on our non-oil exports. Why should not this issue be the priority of the government in 2005? And why should not 2005 be the year for exports with an executive program to deploy all capacities and powers to treat the conditions of exportation of non-oil product and identify hindrances to export growth in general.
For this suggested program to get attention from the government, it should be sponsored directly by the President himself. It is a very crucial matter. We need to avoid a setback similar to that of 1998 when oil prices went down. Non-oil products should be encouraged, particularly given the fact of the inevitable membership in the
GAT agreement, and the Arab Free Exchange Area.
Here, we are sending a warning, setting forth the fact before the competent authorities in the government. We stress the importance of real partnership between the public and the private sectors. If this is to be done, then we will get out safely from the economic depression from which many sectors suffer. If this decline persists, many productive establishments will close down and unemployment will increase. Consequently, economic and social conditions will deteriorate with poverty becoming more severe, and crime prevalent.
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