Donors are calling for the Hadi government to have a credible and transparent plan
English - Thursday 15 October 2020 الساعة 02:30 pm
Aden, NewsYemen, Exclusive:
Minister of Planning and International Cooperation, Dr. Najeeb Al-Awj, said that the Yemeni economy has declined 6% this year.
Al-Awj attributed the decline in the economy to the decline in remittances from expatriates, the deterioration of tax revenues, customs, foreign aid and social protection programs, and the deterioration of the Yemeni currency, due to the measures taken by the Houthi coup militia.
The Minister of Planning, while presiding over the virtual meeting of the eighth steering committee - the project of livelihoods and improving resilience in rural areas - called on all donors, led by the European Union, to expand its interventions in the humanitarian and developmental side.
But the United Nations called on the Yemeni government to put in place a credible and transparent plan that reassures donors and includes the payment of public salaries.
The United Nations said that the Yemeni economy needs, in addition to a transparent plan, financial assistance to the Central Bank of Yemen so that it has sufficient hard currency to maintain food imports, prevent further collapse of family income and stabilize prices.
A new economic study estimated the cumulative contraction in the real GDP of the Yemeni economy by 50% in 2020, compared to its size in 2014.
The study, "The limited regional and international funding for the humanitarian response plan in Yemen and its repercussions on the economic and social situation," said that the per capita gross domestic product fell to 364 dollars in 2019.
The study, funded by UNICEF, added that the per capita gross national product decreased from 1,193 dollars in 2014, with a cumulative rate of change of 69%, which means that more people will slide below the poverty line and the severity of the humanitarian crisis.
The Houthi militia’s coup against the state in late 2014, and the imposition of war on Yemenis, caused catastrophic consequences for the Yemeni economy and worked to weaken its productive capabilities and squandered its material, financial and human energies.
The economy has entered a period of prolonged contraction since 2014 and reached its peak in 2015, when the economy was almost completely paralyzed and lost about a third of its potential domestic product as a result of the suspension of a large part of economic activities in the public and private sectors.
The Houthi war also destroyed production and service infrastructure and facilities, causing many economic and investment activities to be disrupted, in addition to severe crises in cash, fuel, electricity, food, water, transportation, education, health care and others.
The economic crisis has affected the humanitarian situation of a large segment of the population, as there are 24 million people in need of humanitarian assistance and more than 60% suffer from food insecurity.
