Saudi Capital Influx for Investment In Yemen [Archives:2001/12/Business & Economy]
In a step viewed as vital to enhance investment, economic and trade relations, especially after the border treaty was signed in Jeddah in June 2000, two agreements were signed between Yemen and Saudi Arabia. The first indicated the Saudi agreement to offer new loans to Yemen totaling $ 300 million to fund projects including the provision of roads and electricity. According to the second agreement Yemeni debts due to Saudi Arabia, totaling $ 249 million, were rescheduled and reduced by about 80,70% to be paid over 40 years. The two agreements are to be referred to the Yemeni-Saudi Coordination Council, expected to be held the coming June, for endorsement.
Enhancing the Trade and Investment Partnership:
A delegation of investors and businessmen, headed by Ismail Ali Abo Dawood, chairman of the Chamber of Trade and Industry in the kingdom, paid a visit to Yemen and held talks with their Yemeni counterparts, to consider ways of establishing joint projects. This will consequently help support the development process in the two countries.
The Saudi delegation held extensive meetings with Yemeni officials which were attended by the Planning and Development Minister, Supply and Trade Minister and Culture and Tourism Minister. Means of strengthening mutual relations ensuring a proper and conducive environment for investment and trade were also reviewed.
The issue of enhancing the comprehensive partnership between Yemeni and Saudi businessmen, including industrial investment and increasing the volume of exports to Yemeni markets, was also discussed in these meetings.
The Saudi delegation consisted of about 80 Saudi businessmen from various fields including food, construction, medicine and science, etc. During the visit the delegation was acquainted with investment opportunities in Yemen, especially in the Free Zone of Aden. They also came to learn about laws organizing the whole process of investment in all industrial, agricultural, fish and marketing fields.
Memorandum of Understanding Signed:
At the end of the meetings between the delegation and Yemeni officials, a memorandum of understanding was signed between the Saudi Trade and Industrial Chamber and the Supreme Council for Developing Yemeni Exports. The memorandum seeks to facilitate procedures for exports between the two countries.
It also stipulated the importance of facilitating and developing procedures for specifications, standards and transportation; encouraging Yemeni and Saudi private sector establishments to establish joint projects for exportation and importation; and exchanging experts, trade information and studies, in the field of developing techniques of casing and canning agricultural, industrial and fish products.
The Yemeni government attaches a lot of significance to meetings between Yemeni and Saudi businessmen to increase the influx of Yemeni emigrants’ capital in the kingdom, along with the capital of Saudi investors, into the country. This will help create new job opportunities, considerably relieving the unemployment burden. This may also help some Yemenis to go back to Saudi Arabia to work.
The Saudi delegation’s five-day visit to Yemen has emphasized the Yemeni-Saudi Coordination Council’s determination to develop trade relations, strengthen cooperation between Yemeni and Saudi establishments and to establish joint projects.
Yemen, a Promising Market for Saudi Products:
Due to the rising population of Yemen, the Yemeni market will be a promising consumer market for Saudi products, leading to an increase in Saudi exports to Yemen. On the other hand, the surplus in Yemeni agricultural products offers a better opportunity to increase Yemen’s agricultural exports to the kingdom.
Statistics indicate that the value of Saudi products to Yemen reached 534 million Saudi Riyals in 1999. The trade balance of the two countries reached a surplus in favor of Saudi exports, of about 441 million Saudi Riyals in the same year.
The total number of industrial and non-industrial joint projects between Yemen and Saudi Arabia ran to five projects at the end of 2000. Most of them were focused in the industrial field with a capital totaling 744,37 million Saudi Riyals. The Yemeni side contributed 26,18% to these projects.
To conclude, the Saudi trade delegation to Yemen is an important watershed in the field of economic cooperation, which will help a great deal to achieve a remarkable investment partnership between the two countries in times to come.