Government fails to use flood of debts [Archives:2004/746/Local News]

June 14 2004

The Council of Ministers, during its regular session on Tuesday June 8, presided over by Prime Minister, Mr. Ba Jamal, discussed the special report related to foreign debts of the Republic of Yemen until the first quarter of 2004.
The report indicates that the current balance of foreign debts stands at 5,362 million USD. The sum of previously paid installments with interest stands at 3,106 million USD.
The report also stated that the government was able to reach some settlements with some donor countries regarding loans, including the elimination of 68,035,291 USD from debts to Bulgarian government and the sum of 960,011,544 Japanese Yen was also cancelled from debts to Japan.
The council approved the report and confirmed that the Ministry of Planning and International Cooperation will present a comprehensive report about the projects financed by loans and on the progress of these projects and to explain what are the obstacles hindering their completion.
The Prime Minister commented on the report by confirming that the size of foreign debts is ideal considering the situation of Yemen comparable to other developing countries.
According to government sources, Yemen has begun an intensive campaign to obtain more assistance from international organizations and donor countries.
Officials at the Ministry of Planning and International Cooperation say that they are undertaking a campaign to implement the decisions taken during the Millennium 2000 meeting in New York, and to translate them into reality by the year 2015, during which the governments of the G8 would present reports about the level of accomplished goals. They point out that Yemen is estimated to need billions of dollars that could be gathered from donor countries and international donating organizations, in addition to the revenues from investment projects. However, Yemeni and Arab investors are afraid to launch many investment projects due to insufficient guarantees to protect their funds, as well as other obstacles.
Sources indicate that Yemen needs three billion USD in loans and assistance during the years 2001-2010 to achieve its goals.
An economic expert confirmed that Yemen doubled its foreign debts in recent years in an unprecedented way after some of its debts were canceled by the Paris Club. This increase constitutes an additional threat to the country's future economic and development advancement on the long and short terms.