Yemen: Claiming the futurePart V in a series [Archives:2004/754/Culture]
Irena Knehtl
[email protected]
For the Yemen Times
In part four of her discussion of the economic development of Yemen, Irena Knehtl analyses the development of the republic since unification, and highlights continuing challenges and opportunities.
22nd May 1990 – Yemen unites into Republic of Yemen
like a candle I glow
while burning away
As the history of Arabia is one of perpetual motion and covering phenomenal distances, so has Yemen over the past years made impressive strides forward and set the stage for sustainable nation building. It has introduced a multiparty system, embarked on democratization and local government experiments, and is committed to the free market and an enterprise economy. Further implementation of economic reforms, rationalization and efficiency building will create an attractive environment for investment. Yemen has been scripting a new economic future for itself as it draws big plans. The basis for 'New Yemen' is one of intensive development in many areas during which it aims to explore new ways
– for creating jobs and production opportunities in a constrained industrialized economy and
– exploring economic liberalization for exports while
– further developing a culture of entrepreneurship with
– and economic policy of diversification reducing dependence on oil,
– continuing the local governance experiment
– increasing the importance of human choice, and
– developing a foreign policy to maximize flexibility
History teaches us that the path to success is always arduous, strewn with challenges and hurdles. However nations like Yemen stand this test of time in order to achieve political, social, economic and cultural harmony. Yemen's journey from a traditional, underdeveloped at the start to a modern developing economy has been remarkably rapid.
Investment, for example, is now open for all in numerous fields, including oil, gas and mineral. Oil and gas have become the foremost sectors and the backbone of the economy. Efforts have been exerted to create a favorable climate for foreign investment, and facilities are being offered increase available resources.
The Yemeni Investment Law
The Yemeni Investment Law aims at mobilizing and facilitating the influx of potential local Arab and foreign capital and providing the private sector with the impetus for more involvement and investment endeavors.
Facilities and Incentives
The General Investment Authority acts as one window authority for investors. Simplified procedures for project licenses now ensure waits of a maximum of 30 days for health and fishery projects and 15 days for others. Duty exemption of fixed assets required for establishment, extension and development, tax holidays from 7 years to 16 years and duty rebates for the exported portion of production are also now in place.
Guarantees and incentives
Existing guarantees and incentives for investment include:
– Guarantees against nationalization, seizure and restrictions
– No difference drawn between Yemeni and foreign investors
– Ease of capital and profit movements
– Investors' freedom of choice and operations
– Freedom of administering projects with regard to employments, pricing, products and export
– Freedom to buy or lease land or property
– Training funds for labor-intensive and export-oriented projects
– Easy procedures for bringing in skilled expatriates
Yemen is also a member of:
– The Inter-Arab Investment Guarantee Corporation
– The Islamic Corporation for the Insurance of Investment and Export Credit
– Multilateral Investment Guarantee Agency
– International Convention for the Settlement of Investment Disputes
All procedures were simplified to attract local, Arab and foreign investment.
Investment Opportunities
Yemen's most obvious investment opportunities lie in oil, gas, mineral exploration, agriculture, fishery, infrastructure and tourism, including the whole range of economic, production and service sectors aiming at the creation of new job opportunities and the application of the appropriate technology.
Opportunities are available for specialized agricultural production, including fruits, and vegetables, oil seeds, spices, garden seeds and flowers that could be attractive to innovative local investors as well as foreign.
Conditions also favor specialized livestock and poultry operations and fish and shrimp farming. Food processing for domestic use and export also has an enormous potential for expansion.
The country will only benefit from investment when the capital inflows lead to the increase in growth without any changes in trade conditions.
The Aden Free Zone
here we are all strangers
strangers are relatives
Through history Aden has been a port of commercial importance and a meeting point of ships coming from the Red Sea, from India, from the Persian Gulf and from East Africa. The port of Aden is also one of the worlds largest natural harbors located at the crossroads of the Red and the Arab Sea with direct access to the Indian Ocean. Once a top international shipping port and the second largest bulk port, Aden is set today to remake its name.
Aden Free Zone now aims at facilitating industrial development and the flow of trade between countries, i.e. among the Indian Ocean community of countries of which Republic of Yemen is a founding member. It is further initiating economic cooperation among the Red Sea countries to build cooperation among countries and act as regional information highway and investment center. The private sector has taken the lead in financing and operating most of the projects needed for regional growth. Yemen may in fact play the role of a bridge in the Indian Ocean community, now fastest growing behind the Asia-Pacific Rim. To the east is Japan as global economic superpower, to the west an increasingly united Europe revitalizes its former industrial base.
As 'Aden Free zone includes the container project and the industrial warehouse estate project. It will include also Aden industrial and warehouse estate, the construction of a new convertible gas turbine plant, the development of a new air cargo village and construction of an international airport, new sewage and water treatment facilities, and development of new tourist facilities.
Free Zone incentives include:
– Exemption from taxation on industrial and commercial profits for 15 years with a possible extension for a subsequent 10 years,
– 100 percent foreign ownership permitted and encouraged
– Free transferable capital and profits not subject to exchange controls
– Income tax exempted salaries.
Due to Yemen's excellent geographic position on the main shipping route between Asia and Europe, and en route to Australia and South Africa, the Aden Container Terminal not only will reduce shipping rates, but act as a natural product distribution and service center. The world “middle” in Middle East carries great significance to the region in trading terms. Through history, the Middle East has functioned as a link between east and west. Of all possible locations Aden is the most strategically placed, for its offers the minimum deviation from the East-West route.
Aden is becoming a transshipping location to recon with.
Also all other Yemeni ports are ideally positioned for economic growth.
Yemen – Unique Tourism Product
Yemen has excited the imagination of travelers through the ages. Once such account reads: “Here they traveled through landscapes they did not know, the like of which they never seen before. The journey took them through remote mountains ranges, dissected by mystifying wadis, and into a mysterious and rarely seen power of light and beauty. There were houses in search for light reaching the sky, terraced fields of wheat and barley, pines, plots of vegetables. Far below a yellow haze hid the Desert of the East”
Not only unknown but also unreachable and therefore unknowable, Yemen was the most curious in its customs and philosophies, the most unique in its fauna and flora where its landscapes and people changed from one place to the next.
Today travel is no longer a philosophical matter, it is business. In the days of instant information, we have lost a sense of purpose and more importantly and sadly – a sense of history. But if we were to look over the whole world to discover the country most richly endowed with all the wealth, power and beauty which nature can bestow, some sort of paradise on earth, I should point to Yemen. Yemen is incomparable in the wealth and variety each terrain boast it charm. Yemeni really is complex and varied. n
Yemen as international tourism destination will not take off until we go beyond a simple “pure tourism” approach, which means the development of cultural tourism. Yemen's comparative advantage over other destinations on the peninsula lies in its thousands of years of cultural heritage. That should be developed and promoted with tourism. It should project Yemen as a great civilization. This age old civilization rightfully deserves to be viewed with respect. Yemen has a cultural heritage of exceptional antiquity.
Scenic beauty, dramatic terrain and friendly people, Yemen has the magic formula that appeals to tourists worldwide. Tourism can bring visible prosperity and employment opportunities in short time. That “miracle” is distinctly achievable.
——
[archive-e:754-v:13-y:2004-d:2004-07-12-p:culture]
