Budget deficit drops to YR 18 billion,Low indicator on non-oil exports [Archives:2003/668/Business & Economy]

September 15 2003

Mahyoub Al-Kamaly
Final account indicators revealed that actual revenues of the State budget for the fiscal year 2002 amounted to YR 579 billion, 254 million and 726 thousand.
An official report explained that the total public expenditure reached YR 597 billion, 788 million and 382 thousand whereas indicators of non-oil export revenues are still low.
The report has considered that estimations of the increasing deficit of the budget has not been compatible with orientations of the financial and economic reform program, which aims at containing that deficit and keeping it with in save boundaries throw developing external exports.
Despite that the budget deficit while it is under preparation other being the year 2003 registered around YR 63 billion, in a progressive indicator reflecting low proposition of growth in the gross domestic product and non-improvement in non-oil exports in addition to weakness of imports and continuation of involution rate at a percentage ranging between 9 –11% according to the World Bank.
Official figures indicate that Yemen’s non-oil exports have recorded slight growth during the past two years. According to these figures the value of agricultural exports amounted to 2.94%, fish 1.35%. Industry 1.10 % steel scrap 1.35% and other exports at 0.14% out of the total value of exports in the past two years that where estimated at YR 19.151 billion of the total value of exports amounted to YR 377.782 billion in 2000. According to exporting indicators of non-oil products Yemen exports 30.14% to Saudi Arabian, 23.38% to the Emirates, 5.94% to Somalia and 4.09% to Djibouti and also to Ethiopia, Egypt, Jordan, Eritrea, Sudan, America, France, Britain, China, Japan, Singapore, Thailand, India, Oman, Turkey, Kuwait and Germany.
The government is seriously considering decreasing the existing impediments before non-oil exports including direct export/import, without middleman between importers and exporters.
The Higher Council for developing exports is working at preparation of technical studies on external markets in a manner leading to improvement of agricultural and fish marketing services, and saving areas of transport at Yemeni ports.
The government has directed productive authorities, especially in the industrial sector on the necessity of adopting the criteria implemented in the GCC countries regarding standardization and quality for offering a national industry attracting confidence of consumers at Gulf and Horn of Africa countries.
The Higher Council of development of Yemeni Exports has suggested certain points, including establishment of a bank for supporting exports and increasing Yemenis participation of foreign Trade Fairs for promoting to Yemeni products.
The Yemeni government is trying to getting rid of dependence on oil as a major source for supporting the budget, as the value of oil exports constitutes around 94.23% of total revenues of exports.
This urges Sana’a to develop its non-oil exports in order to obtain revenues from save sources to support the budget and put an end to financial deficit.