Mohammed Hassan Zubeiri: “In-fighting within the FYCCI has weakened it a lot.” [Archives:1999/11/Business & Economy]

March 15 1999

The Federation of Yemeni Chambers of Commerce and Industry (FYCCI) is supposed to be a lobby front for businessmen. The very purpose behind its establishment is to promote the interests of the business community, advance its concerns and needs, and provide a forum for discussing and presenting its views. It also serves as a link or bridge with international bodies interested in working in Yemen.
That is the justification for the businessmen to bankroll the organization through regular fees and contributions.
Instead, however, the FYCCI has become a tool of the state to manipulate the business community. Today, the FYCCI has even failed to control its own destiny.
Ismail AGhabiry of Yemen Times discussed this matter with Mr. Mohammed Hassan Al-Zubeiri, Vice Chairman of the FYCCI and Acting Chairman of the Sanaa Chamber of Commerce. Mr. Zubeiri is a well-known businessman. He is the Director-General of Zubeiri Trading Company, which has major interests in diverse activities including banking, trade, industry, etc.
Q: Let us start on a positive note. What services does the FYCCI provide to the business community?
A: The FYCCI has done a lot to reflect the views of the private sector. Let me point to one important contribution it consistently made, which is in shaping those laws which affect business.We are involved in amending law drafts and pointing to implications of law drafts.
Another important service is in the form of alerting businessmen to various opportunities that arise locally or in conjunction with foreign investors.
Finally, the FYCCI is an important forum for meetings, whether for locals, or for visiting business people.
Q: You make it sound like it is an active organization?
A: It is true we not satisfied with its performance. There are many problems including lack of adequate and qualified staff, improper administrative structure, inefficient management, etc.
But, I also don’t want to make it sound like a dead organization. It lives, but it has its difficulties.
Our major problem is how to make the FYCCI in the periods between elections.
Q: Elections? When was the last time the FYCCI and chambers had elections?
A: Well, the elections of the FYCCI as well as the regional chambers have been delayed a few times.
Q: For how long?
A: The elections have been delayed for more than four years now. But the blame is not just on the federation’s side. Elections were delayed partly because the new law of the Chambers of Commerce was not issued.
During Ramadhan (two months ago) it was finally issued by a Republican decree. We expect elections to be held over the next few weeks.
Q: Can you shed light on the internal fighting within the FYCCI?
A: We have some difficulty in managing the FYCCI. Some FYCCI leaders behave as if this is their personal office. They also have some proteges, thus leading to various camps within the organization. This has dramatically weakened it, and its ability to interact positively within ourselves. For example, not many board members care about attending board meetings any more. This is also partly because many board members are not legitimate because they were never elected. They were appointed by the chairman, and he has no right to do that.
Our internal squabbles have also affected our relations with the government authorities, as well as with our international partners and similar bodies.
Q: How would you describe FYCCI relations with the Yemeni authorities?
A: There are different levels of interaction. As far as the government is concerned, I have never felt that it wanted to interfere with our work, or tried to affect our views and decisions.
But, there are other organs of the state which meddle in our affairs. I can bluntly tell you that one of the FYCCI senior staff pretends that he has a strong link with high people in the ruling party (People’s General Congress). Whenever we object to some of his decisions made on our behalf, he refers his decision to instructions from them.
Such behavior casts a dark shadow on the image of the state, it disrupts our work, and frustrates our members.
In general, I must say we have a good relationship with the authorities, especially with President Ali Abdullah Saleh.
Q: Why would anybody be interested in the FYCCI?
A: Well, there are many reasons. First, the FYCCI is a very lucrative organization. It has a lot of money. In addition to the income from donations and regular subscriptions, it collects 0.015% of the value of all imports into the country. This generates an income of at least YR 15 million every month.
The FYCCI is also a conduit for international businesses wishing to work in Yemen. Here is where many agencies are landed, and many representation and joint ventures are finalized.
I am sure you know that many senior officers in PSO as well as high ranking officials have secured shares and stakes in many companies through such interference. They have become our sleeping partners.
Q: Let me go to the relations between the FYCCI and the regional chambers. What do you do for them?
A: As the FYCCI collects all revenue centrally, in theory, it should help finance various efforts, including the construction of premises. This duty was long ago forgotten.
But recently, the FYCCI has embarked on many projects – most of them still in the stage of promises. The reasons behind this renewed interest, I believe, is because elections are bound to be held soon, and they will need the support of the regional chambers.
Q: Let us get out of the FYCCI headache. Where does Yemen stand vis-avis the World Trade Organization?
A: The WTO, which is a culmination of the GATT rounds, is a devise in the service of the strong and rich. I believe the WTO will have a negative impact on developing countries, including Yemen.
Integration in the world market means that those countries that are better endowed will run the show. It is as if you push for an open and free race, whereas the conditions of the racers are not the same. Some are well-trained and healthy, some are sick and crippled. In this case, you can tell immediately who will win the race.
Even among the strong, there are many problems. The Banana Trade War between Europe and the USA today is a good example.
However, whether we like it or not is immaterial. We will be forced to join, sooner or later. So, the best line of action is to prepare our economy and to negotiate better terms as much as it is possible.
Q: What is the volume of Yemen’s imports today?
A: This is an interesting question. Do you know that nobody knows exactly what the number is. There are two reasons.
First, Yemeni importers engage a lot in trans-shipments. In other words, they do not buy from the producer, they buy from regional markets like Saudi Arabia and the United Arab Emirates. So, many of our imports actually show in their statistics.
Second, there is the phenomenon of smuggling. A lot of foreign goods flow into the country illegally. Many experts believe the volume of underground imports is equal to the volume that comes into the country through legal means.
In approximation, I can say that our total imports are about US$ 3.0 billion a year.
Q: You mentioned smuggling. Why can’t we stop this?
A: Smuggling is a serious problem for the economy. The government had tried to control it, it is not easy. The smuggled goods continue to flow in.
I can list the following negative consequences to smuggling:
1. Loss of revenue to the state.
No customs duty or taxes are levied on smuggled goods.
2. Unfair competition:
As a result of item (1) above, smuggled goods are cheaper than goods legally imported or locally produced, both of which are subject to taxes.
3. Consumers are NOT protected:
There is no possibility of enforcing quality control over smuggled goods. They are often inferior and substandard.
Q: Where do we go from here?
A: I think the potential for Yemen is very good. We have natural resources, a hard working population, and a low level of consumption. All we need is better management.
I also believe the investment laws and the Aden Free Zone will play a big role. Again we have to manage both properly to entice local and foreign investors.