AL-SAHWA: Sanaa weekly, 2-7-98. [Archives:1998/27/Press Review]

June 6 1998

[Yemeni Congregation for Reform (Islah)]   Main Headline:
1- Speaker of Parliament and Islah Leader, Sheikh Al-Ahmer is to visit Iran and Cuba.
2- 3000 people rake part in a peaceful demonstration in Mukallah in protest over the government’s decision to raise prices.
3- Prime Minister Al-Iryani stipulates that university lecturers in Sanaa and Aden should end their strike before talks could start to address their demands.
Article Summary
Real Cause of Economic Crisis
The government has considered the deep economic crisis that hit the country as a problem of small revenue causing a budgetary deficit, which leads to rising inflation. So according to this shortsightedness, the solution would be to increase the revenue. Hence, it resorted to price increases and incurring more foreign debts. The temporary lowering of inflation gave the illusions that the crisis is over. However, the budget deficit rose dramatically during the first half of 1998, threatening to raise inflation.
The real reason behind the deteriorating economic situation is corruption and bad management of the national economy. Bad management means the inability to adopt successful economic policies. The inefficiency of state establishments, the concentration of power within a small elite, the marginalization of important civil institutions, and neglecting to implement laws and regulations are all factors fuelling the crisis.