Economy hit hard by terror attacks Rescue Aden! [Archives:2002/50/Front Page]

December 9 2002


Aden, known as the pride of Yemen and among the world’s best-known port cities, is going through fires of crisis caused by Yemen’s string of terror attacks in the last several years.
If ever there was a time it needed help, it is now.
It all started when the Abyan fiasco occurred at the end of 1998, killing four Western tourists in Abyan, which is close to Aden.
Then the attack on USS Cole took place in Oct. 2000, attracting world attention to Aden as a dangerous port for military ships.
The city’s economy was then crippled as world media focused on Aden and reminded the world that its neighboring governorate is the hometown of Osama bin Laden, the leader of al-Qaeda and the most feared organization of the West.
Investors and businessmen refrained from moving on to invest in Aden because of security threats and risks. However, the Yemeni government and the Aden Port Authority tried extensively to clear this negative reputation by giving more facilities and features to investments and going on the gigantic and promising Aden Free Zone project.
Just as things started getting better, the 9/11 events took place and the war against terror started.
Like all cities in the Middle East, Aden was also affected when vessels and trade companies kept clear, especially as it is adjacent to Hadramout, Osama bin Laden’s home.
But Aden didn’t give up and started to revive its activities once again after the war in Afghanistan ended with the defeat of the Taliban, thinking that al-Qaeda’s threat was minimized. Activities at the port started to pick up again, but the unexpected happened, and the French tanker Limburg was attacked on Oct. 6, 2002.
The Limburg attack was the most devastating of all because it targeted the lifeline of the world economy, that is oil. And oil is associated with almost everything imaginable.
This was the point when Aden said, ‘Enough is enough!’ and realized that unless stability is retained, Aden won’t be able to go on as a vital economic and trade hub in the region.
“It just cannot happen,” one of the businessmen said.
“Economic life in Aden has come to a halt. We are in a state of stagnancy and losses have become unbearable,” he added, but requested not to mention his name.
Indeed, everyone who knows Aden and its potentials realizes that what the city has gone through during the last two years is totally devastating.
The City of Aden has suffered from several problems that stalled the commercial activity at the ports and led to great losses for the city in particular and for the Yemeni economy in general.
Insurance rates for ships heading to Aden have increased tremendously especially after the Limburg attack near the coastal city of Al-Mukalla, which is closely associated with Aden.
As a consequence, the private sector in Aden is going through an unbearable crisis. Profiting investments in the mid 1990s have turned into losses, and businessmen in Aden are asking for someone to come to the rescue.
Yemen Times met a few of the prominent businessmen in Aden to get their views. They described the situation as catastrophic, expressing their discomfort with the negative affects of the terrorist attacks that took place in the last two years.
“We depend on the port almost wholly for our import and export activities, and you can imagine what would happen if it is not operating properly,” Another businessman said.
The business community in Aden is complaining of the doubling in insurance fees three folds following the Limburg attack, which caused a number of international shipping companies to change their routes in the Red Sea and the Arabian Gulf.
The investors in Aden know that if conditions don’t improve, they may end up filing bankruptcies, especially as raw material has to be transported through a number of new means including small ships and boats. This adds more burdens and expenses to the private sector.
The insurance cost for a 20-foot container reached a record US $298 and US $500 for a 40-foot container. This resulted in the suspension of a large number of investment projects in a number of companies in Aden, which will probably result in the increase of food prices soon.
Apart from the trade sector, the tourism sector also lost a large portion of its international market, as the number of foreign tourists visiting the city has declined.
However, all is not totally lost, say some businessmen. With insistence and perseverance things can change to the better.
The president’s decision to retain the pre-October 6 insurance fee is seen by investors and businessmen as a positive step, which they hope to be implemented as soon as possible.
Steps to revive Aden’s port activity have already started as on Dec. 1.
A Yemeni delegation headed by Minister of Transport and Marine Affairs Saeed Al-Yafi’i and accompanying representatives from the port of Aden and Hodeidah, Yeminvest, and the Yemen Marine Chamber, will be attending the 76th meeting of the International Marine Safety Committee.
The Yemeni delegation is expected to present proposals to support ports in developing countries in terms of facility and service enhancement. The delegation will also be meeting with representatives of International insurance companies in London to persuade them to reduce insurance fees.