IFC suggests partnership to cure Yemen's ailing economy

SANA'A, May 24 (Saba) - A public-private sector investment
partnership could help boost Yemen's ailing economy and reduce the
financial gab in the country's investment program, the International
Finance Corporation suggests.

A more effective partnership between the two sectors can produce $
1.6 billion in joint ventures to develop basic and transport
infrastructures and then help reduce a $ 2.3 billion financial gab
in Yemen's investment program, the IFC says.

A report issued by the ECORYS, a company which the IFC sought help
from on the legal framework for a Yemeni public-private sector
business partnership said such a partnership will help invest
private capitals to improve public services.

In this regard, the IFC said it had prepared a program for a
public-private business partnership in the country to be implemented
in four phases over 2009-2020.

Despite all Yemen's efforts along with donor's loans and grants
directed to boost national economy, development goals have not been
achieved yet, with a $ 2.3 financial gap still in the investment
program of a country which needs to invest between 7-9 percent of
domestic production in infrastructure to sustain development.

Hence, the public-private sector business partnership can largely
contribute to develop infrastructure through benefiting from private
capitals.

The IFC program should be carried out in four phases: 2009-2010,
2010-2015, 2015-2020 and the fourth phase the completion period
beyond 2020, with costs for joint ventures during the phases
estimated at $ 1 billion, $ 200.000 for each.

Proposed projects under the program include: Hadramout-Broom Port,
the first phase at $ 456.000, to transport services for border areas
and export minerals and petrochemical industries.

The second project is the Sana'a-Amran road project at $ 200.000,
the third project is the Manakha tunnel at $ 80.000-100.000, the
fourth project is energy stations and the fifth project is
developing the industrial zone with the goal to expand industrial
areas in Yemen and provide suitable infrastructure.

However, the report stressed that several measures should be applied
while implementing the projects, including the focus on sectors
which proved successful partnership at the world level, taking
advantage of the studies on the partnership projects and that it is
preferred the government's guarantees to be supported by
international organizations' commitments.

Meanwhile, the report said the public-private sector business
partnership in Yemen may face some difficulties such as those
related to the population growth, geographic factors, week economy
and the necessity to link efforts of development to institutional
and legislative reforms.

Nevertheless, the report urges for joint ventures to meet aspired
ends to be implemented under a clear and well-directed partnership
program.

FR