Investments in Yemen, more reforms, touchable improvements

By: Mahdi al-Bahri

Translated by: Mahmoud Assamiee

SANA'A, May 20 (Saba)- Investment sector tops government's list of
priorities. Since realizing the unity and announcing the Republic of
Yemen in the 22nd of May 1990, the government has made wide reforms
and enacted a number of laws to improve investments.

The government has established Aden Free Zone in 1990 to encourage
foreign investment and attract Yemeni capitals abroad to make Aden
an area attracting investment and a prime trade center to serve
international trade due to the strategic location of the city along
the international marine between the east and the west.

The government's implantation to economic, financial and
administrative reform has been reflected positively since 1995 on
improving investment environment. The registered projects since
establishing the General Investment Authority (GIA) in 1992 till
1996 have reached 2800 with investment cost amounting to YR 266,6
billion.

The approved projects increased till the end of the first quarter of
2009 to 6, 763 projects in different productive and service fields
with the cost exceeding YR 2, 763 trillion. These projects provide
184,000 work opportunities.

The projects which have been carried out reached 3422 project in
2008 with the cost of YR 1, 4 trillion. 1711of these projects are
industrial with the cost of YR, 835, 3 billion. 304 projects in
agricultural field with the cost of YR 33,9 billion while projects
in fishery sector have reached 83 projects with the cost of YR 24,
3 billion. 714 projects have been registered in service sector
with the cost of YR 392,5 billion. Tourism sector has 510 projects
with the cost of YR 155,7 billion.


Government efforts tended for improving investment environment and
providing requirements of investment environment via making wide
reforms in administrative, tax and law fields such as investment law
and laws regarding banks, customs and taxes.

There are also reforms in financial and funds fields as well as
exchanging Yemen Rial against foreign currencies, liberating foreign
trade and abolishing all chains on transporting capitals.

The most important reforms concerning investments are applying the
one stop- shop system.

According work paper presented by Professor of Economy in Sana'a
University Taha al-Fusayel, implementing the one stop-shop system
will save investors 12 steps taken 63 days to finish all measures.
It will also help achieving progress concerning registering
ownership.

Yemen was able to increase economic growth indicators to 4, 5
percent in 2007 comparing to 1.4 percent in 1990 in record time.
This reflected positively on attracting investments, especially gulf
ones.

Chairman of the GIA Salah al-Attar affirmed that the authority has
attracted, since 2006 London conference, Qatari, Emarati and Saudi
investments with the cost exceeding $ 2 billion. He indicated that
the authority is currently preparing national strategy to propagate
for investment after success on releasing reform and improving
investment environment.

He pointed out the investment activity has witnessed influx of giant
investments on regional and international level. Companies from
different countries showed their interests to carry out projects in
Yemen during the next ten years in many sectors. The cost of these
projects is estimated at $ 70 billion.

The most prominent projects being carried out now is the Tourist
Al-Nour City in Bab al-Mandab city overlooking the Red Sea followed
by Sana'a Towers Project and Aden Housing City Project and joint
gulf and Egyptian project worth $ 10 billion.

Aden Jenan Tourist City is being carried out in Aden. The Yemeni,
Saudi and Gulf project costs $ 4 billion in addition to tourist
project being carried out in Sana'a by Addiyar Qatari Company with
the cost of $ 600 million.

"The government worked during the past three years on carrying out
basic reforms to encourage local investment and attract foreign
investments," said al-Attar, adding "the most important of these
reforms is applying one stop -shop system."

Recently, al-Attar said, investment, tax and custom laws have been
revised. He indicated that the new investment law will enhance
duties of the authority to attract investment and ease facilitations
to this purpose.

He clarified that the new tax law includes reducing companies'
income tax from 35 percent to 20 or 15 percent. "The new law focused
on granting the authority wide authorizations to be fully
independent, financially and administratively to be able to carry
out its duties."

Al-Attar made it clear that the new custom law will grant package of
custom exemptions among of them fixed assets of customs to
investment projects. The new law also provides 50 percent exemptions
to industrial projects equipments and 100 percent to agricultural
and fishery projects.

In unprecedented move, the government has established the first
holding corporation to develop investment and join partnership with
gulf, Arab and foreign companies wanting to invest in Yemen.


The duty of the corporation, said al-Attar, is representing the
government in partnership with gulf countries which have desire to
invest in Yemen. The corporation is the body which will give the
land to investors.

The authority has worked on preparing the national strategy for
environment and organized international tender on this purpose. Nine
international companies contested in the tender and Irish
International Developed Company won the tender.

GIA's Head of Propagation Sector Muntaha Muthana said preparing
the strategy comes in the framework of complete plan to build
positive picture to Yemen in international forums and marketing it
as an area attracting international investments.

She indicated that the national strategy has limited aims and
focuses on targeting investors in specific sectors in a number of
countries in the purpose of propagating to investment environment.

Besides, the authority intends to carry out complete program on
information technology on two phases to ease measures and reduce the
time and cost of needed steps to register investment projects and
compose database.

The third five-year plan targets creating encouraging investment
environment ensures continuity of attracting local and foreign
capitals and creating more investment opportunities in promising
economic sectors across the country.