Armies of Liberation

When you factor in the flood and the impact of piracy inhibiting the growth and diversification of the economy, things look really bad. The end of oil is coming but the drop in prices (124 to 55) is going to have an immediate impact. The failure to rationalize government expenditures is pathetic. Saleh recently was a shopping spree with Russia and China and just upgraded the Mig’s to enable the delivery of smart bombs.

Beeb

Yemen is facing an economic and political crisis as the country’s oil resources near exhaustion, a report by a London-based think-tank says.

The Royal Institute for International Affairs warns that instability there could expand a zone of lawlessness from northern Kenya to Saudi Arabia.

It describes Yemen’s democracy as “fragile” and points to armed conflicts with Islamists and tribal insurgents.

One diplomat says that the country’s prospects get worse every month.

The World Bank predicts that Yemen’s oil and gas revenues will plummet over the next two years and fall to zero by 2017 as supplies run out.

Given that they provide around 90% of the country’s exports, this could be catastrophic.

An unnamed energy expert is quoted in the report as saying that this points to economic collapse within four of five years time.

Democracy ‘distorted’

Although Yemen was the first democratic nation on the Arabian peninsula, its democracy is described as fragile and distorted by what the report calls the northern tribal system of patronage around President Ali Abdullah Saleh.

The president is already facing Islamist insurgents as well as conflicts with tribal groups, and must stand down in 2013 after 35 years in power.

The report concludes with a grim warning that a failed state in Yemen could threaten stability across the region.

It says it could open the way to piracy, smuggling and a flourishing jihad with implications for the security of shipping routes and the transit of oil through the Suez Canal.

Its going to get a bit crunchy.

Impoverished Yemen oil revenues up in third quarter

SANAA (AFP) — Yemen, one of the world’s poorest nations, has earned 3.8 billion dollars from oil revenues in the third quarter, an increase of 86 percent over last year, a central bank report published on Saturday said.

Yemen produced 35 million barrels of crude oil between July and September, an increase of 11 percent compared to the same period in 2007, according to the report published by Yemeni newspapers.

It said that the average price of a barrel of crude oil was set at 112 dollars against an average of 66 dollars in the comparable period.

The impoverished Arabian Peninsula country of around 20 million inhabitants exports more than half the oil it produces.

Yemen is neither a member of the giant oil cartel OPEC nor of the Organisation of Arab Petroleum Exporting Countries (OAPEC).

Do they really have money for more weapons purchases? The rationalization of the government budget is not going well I see. Its about 7% of GDP on military and less than 2% on health care. (And even what is spent on health care is largely stolen and sold. )

Yemen, China discuss security cooperation

[11 November 2008]

SANA’A, Nov.11 (Saba) - Yemen and China held Tuesday talks on the aspects of security cooperation between the Interior Ministry and the Chinese company Chin Shida specialized in the exportation of military and security products.

Deputy Interior Minister Saleh al-Zawari affirmed here with assistant director of the Chinese company the importance of developing the bilateral cooperation between the two countries in areas of security cooperation.

Prices are down to about 60 in November from over 120 in July. Where they stabilize or when is an ongoing question, as is whether the oil revenue reliant Yemeni state can weather the storm.

Yemen Times

SANA’A, Nov. 5 – With a total of 1.5 trillion Yemeni Riyals the Yemeni government approved the budget for the fiscal year 2009 in an exceptional meeting yesterday. The public expenditure was estimated at YR 1.9 trillion, yielding a 7 percent of Domestic Gross Product as a net deficit of the budget.

The government had apologized earlier to the parliament for delaying the presentation of the public budget for the upcoming year, which is typically due two months before the end of 2008. Demanding a chance to review the financial plan, the government attributed the setback to the importance of reconsidering budget projects due to the global financial crisis.

Parliament members Sakhr Al-Wajih and Nabil Basha stressed the importance of determining a deadline to present the budget, as parliament members would be on a long vacation beginning from December to the end of January. Al-Wajih added that the government’s demand is logical, as the budget was drawn up on the basis of the old high prices of oil and should be reviewed again as oil prices have decreased notably during the past few weeks. In a related matter, the parliament discussed the financial committee’s report on the global financial crisis and its consequences on the Yemeni economy, summarizing the effects of the crisis and decrease of oil prices on the country’s revenues, payments and trade scales which witnessed a surplus this year due to high oil prices that exceeded USD 146 a barrel. The committee also expected that foreign support and loans will be reduced.

The committee’s report said that the Yemeni monetary reserve is safe as it was deposited in various world banks. In addition, it said that the monetary reserve deposited in the U.S. is safe from the financial crisis as it was invested through the Federal Reserve Bank, and pointed out that the amount of money in the U.S. represents only 1.7 percent of the total monetary reserve of the country.

European countries in which the Yemeni monetary reserve is invested have assured the Yemeni government that their deposits are safe in the banks. Up to 69 percent of the Yemeni reserve is in U.S. dollars, 20 percent in Euros and 9 percent in British pounds and the rest in other currencies, according to the report.

(Read on …)

Is the budget suplemental 66 Billion or 660 Billion? Its a different figure in every paper.

Yemen Post

In its recent meeting, the council of ministers approved a project for an additional credit during the current financial year at YR 66 billion.

Even with the profits in oil and other resources the country has been getting, it still relies on donors to finance the different development projects as loans and donation packages to the country have reached $800 million, according to the annual reports presented by the Central Administration for Control and Auditing (COCA).

As to the crimes of wasting and pillaging the public money, COCA listed over 1165 crimes of waste for public money over the last three years. The total amount of money wasted during the last three years are as follows: YR19 billion, $14 million, 3 million euros and 2 million marcs, together with 18 cars and large areas of lands.

(Read on …)

Ukranian, (like the tanks?)

The Miracle MiG Makeover
October 14, 2008: Egypt and Yemen have hired a Ukrainian firm to upgrade most of their MiG-21 fighters. Egypt has 62 MiG-21s, while Yemen has 47. Egypt had earlier upgraded some of its MiG-21s with British electronics. The Ukrainian firm (Odesaremservis), will install a modern, digital, cockpit (flat panel color displays and far fewer switches and buttons to deal with). Installed under the aircraft will be a laser designator and camera so that the aircraft can deliver smart bombs.

The 9.5 ton MiG-21 is a 1950s design. Poor flight controls and lousy visibility limited what a good pilot could do with this aircraft. But few good pilots flew the MiG-21, as it was built for poorly trained pilots who mainly followed instructions from someone on the ground. It can carry two tons of bombs and missiles.

After the American experience with smart bombs over the last two years, most air forces have accepted the fact that the more expensive (starting at $30,000 each) smart bombs are more effective than the much cheaper ($500 or less) dumb bombs. This potentially makes the MiG-21 a much more effective aircraft.

The Ukrainian firm also offers the Sura targeting helmet, which enables the pilot to look at the target and fire a Russian R-73 heat seeking missile, that will then go after the target the pilot is looking at. If the MiG-21 is facing roughly equivalent aircraft, the Sura helmet makes the aircraft a much more effective dog-fighter.

The Ukrainian cockpit and targeting upgrade costs several million dollars per aircraft.

Cabinet approves adding over YR660 bln to 2008 state budget
Tuesday, 21-October-2008
Almotamar.net,Saba - In its weekly meeting, Cabinet approved on Tuesday a draft law proposed by Finance Ministry on opening an additional appropriation of the state general budget for the current financial year 2008 amounting to YR 660,448,032,000.

The meeting chaired by Prime Minister Ali Mujawar submitted the draft to the Parliament for discussion and approval.

Parliament has postponed discussions of additional credit draft law for the 2008 budget mounting to YR 660 billion after several MPs demanded the government to promptly decide the volume of money required for reconstructing the flood-affected areas in Hadramout and Al-Mahrah to be inset within the additional credit.

They also considered several government officials to be responsible for the immense extent of losses especially when the disaster was forecasted a week ago by media outlets; however, they gave no attention to such warnings.

MP Abdu Bishr threatened to reject the project of the additional credit unless relief costs are included within it, hinting that disasters and floods have become a season for officials to ask for aid from abroad.

Other MPs demanded a transparency as for the way through which aids are distributed so that these aid can reach all the affected people. Some MPs also asked for postponing the parliament sessions until the government officials are summoned to respond to the inquiries of MPs in matters relating to relief and reconstruction processes.

For his part, Head of Freedoms Committee at parliament Mohammed Naji Al-Shaif demanded summoning the officials at the General Authority for Civil Aviation and Metrology (GACAM) to investigate them into the reasons that prevented them from forecasting the disaster.

He also asked MPs and members of Shoura Council to donate one-month salary for the sake of the flood-affected people, together with removing the GACAM officials from their posts.

(Read on …)

The drop in oil prices will undermine the government budget and the system of payola. Yemen Post

Economy professor Abdullah Al-A’dhi told the Yemen Post that the current financial crisis across the world, especially in America, will directly affect the Yemeni economy which is directly tied to the U.S. Dollar.

Al-A’dhi continued that the disengagement from the U.S. Dollar could reduce the direct effects on the country’s economy as the value of dollar is falling before European currencies, particularly the Euro, stressing that we should diversify our basket of currency.

“Yemen will get directly affected by the fall of the U.S. dollar because the country’s exports, mostly oil, are sold in this currency. Any forced devaluation of the U.S. Dollar will devalue the exports,” said Al-A’dhi.

(Read on …)

Of Yemen’s 5.9 billion in external debt, Yemen owes Russia about one billion for military hardware including the Mig 29’s.

Yemen Post

Preparations at Yemeni Foreign Ministry are underway for President Saleh’s expected visit to Russia in which he seeks to buy large quantities of weapons.

Diplomatic sources announced that Saleh’s visit comes at a time the region witnesses complicated developments together with Russia’s differences with western countries and America over the last Russian-Georgian conflict.

The same sources further indicated that Yemen has balanced stances of world powers, hinting the visit comes within the frame of the developed relations between Yemen and Russia.

Observers note that Saleh seeks to buy modern Russian fighters and reinforce the military arsenal after a four-year war in Sa’ada that exhausted the country’s both budget and military armament.

Workshop on failure of investment projects in Aden to be held

[29 August 2008]

ADEN, Aug. 29 (Saba)- Economic sources said on Friday that a workshop would be held in Aden province next Saturday for reviewing and assessing unimplemented projects.

The sources affirmed that 200 projects have been faltering in the province as well as some projects have been transferred from investment projects to housing purposes.

The workshop will be organized by the General Authority for Investment (GAI) in collaboration with German Technical Cooperation (GTZ).

The sources added that the workshop would be attended by about 60 investors and representatives of the General Authority for the Lands, the Chamber of Aden Commerce and Industry and other government bodies to assess the causes of the failure of those investment projects in Aden.

Military spending is a line item in the budget.

TMQ2

Uganda 2.2% (2006)
Ukraine 1.4% (2005 est.)
United Arab Emirates 3.1% (2005 est.)
United Kingdom 2.4% (2005 est.)
United States 4.06% (2005 est.)
Uruguay 1.6% (2006)
Uzbekistan 2% (2005 est.)
Vanuatu NA
Venezuela 1.2% (2005 est.)
Vietnam 2.5% (2005 est.)
West Bank NA
World roughly 2% of gross world product (2005 est.)
Yemen 6.6% (2006)
Zambia 1.8% (2005 est.)
Zimbabwe 3.8% (2006)

First report from Mujawar’s government

Yemen Observer:

Prime Minister Ali Mohammed Mujawar read a statement at a Parliament’s session attended by most of the ministers on the state of the Yemeni economy and the security situation. The report said that Yemen achieved a rate of 3.2 percent in economic growth during 2006, which increased to 3.6 last year, despite the drop in oil production. The non-oil sectors achieved development rates during the two previous years of 4.7 and 5.5 consecutively.

(Read on …)

Theres corruption and then theres grand corruption, elite capture of the vast majority of national resources and wealth on an organized and methodical basis. The best report ever I think was the Journalists Against Corruption report Available here. This YO report is a tad confusing on what the numbers mean:

Tender corruption is currently costing millions of dollars worth of public wealth. This came in a statement for the Supreme National Authority for Combating Corruption (SNACC) manager, Ahmed al-Anisi, at a debate organized by the al-Saeed establishment last Thursday.

Al-Anisi said that they cooperated with other authorities to issue cabinet resolutions to cancel all private authorizations. Al-Anisi helped in controlling some important corruption cases, pointing out that both public and opposition press were their source for discovering some of the corruption cases, mentioning the atomic energy case as an example. He reviewed their achievements as realized in the discussion of the scholarship case and the deductions on the students’ bursaries at the higher Education Ministry.

He ensured the recovery of YR 2 billion and YR 600,000, with several cases being referred to prosecution following long tedious procedures….

(Read on …)

YO

The government approved in its cabinet regular meeting held on Tuesday a budget of youth summer camps for 2008 and its general program to be launched on July 17th across the country.

The camps are 31 and contain 718 centers, 382 for males and 134 for females, 48 centers for educating religious duties, 30 for female scouts, 34 for vocational training, 34 for educating in computer science and languages, 58 for sports and 8 centers for university students. More than 200 thousand male and female participants will make use of these 40-day long camps.

There are also 600 centers for educating 100 thousands students on memorizing the Holy Koran in the capital Sana’a and in other governorates around the country.

USD 143 million? Its low. Maybe thats just new investment.

Yemen allocates $143 million for defence and security
Sunday, 08-June-2008
Al-Motamar
Almotamar.net - An official report mentioned Sunday that Yemen has allocated $143 million and 370 thousand for defence and security, as part of an investment programme for the year 2008.
According to the report obtained by almotamar.net the process of financing is allocated to implement a number of institutional projects aimed at strengthening capabilities of the Coast Guard by installation of new security observation centres in the border areas, improvement of the level of services offered to crossing of ships of the Yemeni coasts in addition to enhancement of protection of security and military positions. The programme includes also the purchase of mechanizations and equipment and the development of communication networks of the security apparatuses besides the establishment of residential buildings and police stations in various governorates.

Military is about 25%

YemenTimes

However, Yemen’s health allocation in its national budget is only 4.6 percent, as compared to 18.4 percent for education, while the child protection allocation is negligible; therefore, much more attention must be attached to these issues in terms of budget and efforts.

There’s one billion (US) in loans, accruing interest, unspent.

SANA’A, Feb. 04 (Saba) - Minister of Civil Service and Insurances Hamoud Khaled al-Sufi held talks with a World Bank delegation headed by Director of Poverty Alleviation and Economic Development Sector, on cooperation aspects between Yemen and WB.

During their meeting in Sana’a, al-Sufi and the WB officer discussed the program of administrative and institutional reforms and future support horizons to Yemen’s efforts in this regard.

Al-Sufi evaluated WB’s support for Yemen over administrative and institutional reforms, saying that the Bank’s continuous support to the country has been positive impact to achieve big successes.

(Read on …)

Thats good if the government can pay for it, maybe cancel some of the weapons deals

Government raises salaries of state employees and raises social security by 100%
Tuesday, 18-March-2008
Almotamar.net - The Yemeni government approved Tuesday granting all government employees at all levels an increment in the salaries amounting to YR 3 thousand as allowance in addition to granting pensioners 50% of the decided increment.

In its weekly meeting chaired by Prime Minister Dr Ali Mohammed Mujawar on Tuesday the cabinet decided raising assistance to social security by 100% and instructed the ministry of social affairs and labour to continue determining the new cases and study them and decide them in accordance with operative mechanisms.

The cabinet considered directives of President Ali Abdullah Saleh concerning alleviation of the impact resulting from the rise in prices of basic stuffs. It urged intensive and strict monitoring prices and taking strong legal measures against those who violate and manipulate prices.

The cabinet also stressed the importance that the Yemeni economic establishment encourages the focus on its commercial activity in the area of wheat, flour, rice and other necessary stuffs. The cabinet asked deputy premier for economic affairs, the minister of planning and international cooperation Abdulkarim al-Arhabi to communicate with donors for providing easy opportunities for the establishment in order to enhance its activity in the area of wheat and flour through building of grain silos of the establishment.

The cabinet stressed on the ministry of industry and trade to activate its role in watching and controlling prices in the capital and the governorates and to refer violators of prices to specialised judicial authorities quickly, affirming the importance of these apparatuses in the speed of deciding the cases referred to them by the ministry of industry and trade and its offices in the governorates.

sounds like the fisheries

YO>

In addition to the kidnapping cases, the Parliament also formed a committee of MPs Mohammed al-Khadim al-Wjih, Mohammed al-Hawri, Abdullah al-Maktari Ali al- Amrani, Abdulrazaq a-Hajari, Nasser Arman,

and Fuad Abdl-Karim to investigate the Yemeni Economic Establishment accounts and report on them to the Parliament.

Prime Minister Dr. Ali Mujawar explained that the Establishment is an affiliate of the Ministry of Defense because the Ministry owns 75 percent of its capital whereas the other 25 percent is owned by the interior ministry.

The Establishment’s capital was YR4 million at its conception, but has now been raised to YR10 billion. Profits in 2005 were YR157 million and rose to YR191 million the next year, according to final accounts. The Establishment employs nearly five thousand people, in addition to providing annual job opportunities for 1500-2000 temporary employees.

Under particular investigation by the committee is the use of the Establishment’s poultry and slaughterhouses. The Prime Minister stated that he should not be asked about the slaughterhouses because such issues do not concern the PM, and are under other Ministries’ responsibility.

Committee member al-Hajari responded by saying that he had practiced his constitutional rights because he did not know to which authority the Establishment was linked, so he had to direct his summons to the Prime Minister. He inquired into the Establishment’s financial practices when, in 2005 it had YR10 billion in capital, while gathering such low profits despite its commercial activities which included trading in textiles, meat, oxygen and companies.

The Establishment’s manager answered, saying that the Yemen Economic Establishment is a service and not for profit. He explained that the companies which were annexed to it were bankrupted and were under liquidation, assuring that their profit was not zero in 2005 and confirming that the final accounts are accessible.

Yemen Observer:

The Public Money Prosecution managed to recover YR1 billion in embezzled public funds in 2007.

Dr. Abdul al-Malik al-A’wash, a lawyer with the Public Money Prosecution, declared that YR1,000,248,747 was recovered in addition to $284,000 and 2300 Euros, due to sequestration and attestation rulings in embezzlement cases in the same year.

Al-A’wash said that they received 1,758 cases in all governorates last year, and 589 of them were considered serious.

Al-A’wash added that verdicts were passed on 202 of these cases, 832 are still undergoing investigation, while 20 were dropped due to lack of jurisdiction. Decisions of absence of right were passed on 204 of the cases. He added that they received 68 cases from the Central Organization for Control and Audit (COCA), asserting that the Capital Secretariats in Aden, Taiz, Hodeida, Hadramout, Lahj and Ibb were the worst offending regions in the public money cases.

Oil subsidies at work.

SHABWA,NewsYemen

The director of security in Shabwa Hamoud al-Harithi said police arrested a group of people while they were attempting to smuggle a quantity of diesel abroad.

“The smugglers were trying to take away tanks containing 150,000 liter of diesel through the see,” said al-Harithi. He said owners of some fuel stations and some oil companies working in Yemen have offered assistance to smugglers.

Update:

Through looking at the other side of the corruption cycle, the different levels of governance have varying degrees of involvement in corruption, ranging from the baselines to middle and high-level officials. However, the recent formation of the Supreme National Authority for Combating Corruption has raised hopes in the sincerity of government’s efforts towards enhancing transparency and battling corruption.

However, spectators indicate that the anti-corruption commission will have limited success in any anti-corruption reforms, quoting that the commission has distributed over 3000 applications for the disclosure of net wealth to high ranking government officials, while less than 300 officials cooperated with the commission and disclosed their net worth. Challengingly, a source who requested to remain anonymous indicated that the president himself refused a request from the commission to take the lead and disclose his own net worth in order to influence other officials, but the presidential office turned that request down.

It is obvious that the anti-corruption commission will be facing a serious challenge if it is to succeed in its anti-corruption mission; however, the hope relies within the support of the international community and donor organizations such as the World Bank and USAID.

Original Post: The article doesnt mention how many declaration forms were sent out, I think its around 2000. Its a good system. As with everything else, the key will be enforcement. Publishing the names in the newspaper is not enforcement; legal action is. The state cannot be above the law, but it is.

al-Motamar

Almotamar.net - The Supreme National Anti-Corruption Authority (SNACA) in Yemen has on Wednesday threatened to refer all those who are lagging behind in delivering their financial declarations to prosecution to be accounted on heir properties and to be tried on charges of corruption cases in case they did not deliver those declarations as soon as possible.

Head of financial declaration sector at the SNACA Mohammed al-Matari told almotamar.net that the authority would in the next three weeks prepare statements of the names of those who failed to present their financial declarations and sending them to prosecution and trial.

The SNACA has earlier defined a date for all those involves in financial declarations in 60 days from receiving the form but many of those included have delayed in committing to that and that impedes the authority work. Al-Matari said the number of those who delivered their financial declarations from ministers, directors general and government officials is so far 592 persons, indicating to almotamar.net that all the ministers have handed over their declarations while many of directors general still have not delivered their declarations.

This measure comes at a time the authority has revealed that of investigations carried out by officials at the authority in 54 cases of corruption.

Its just going to get worse as oil revenue continues to decrease. From the Yemen Observer

News of a British company’s intention to cut off the electricity supply to some governorates was denied by Dr. Mustafa Buhran, Minister of Electricity and Energy. The Minister confirmed that the published news goes back to a previous dispute, and was obtained by a newspaper correspondent who either negligently published it, or published it with the intention of creating public unrest.

The Minister declined to speak about the agreement’s details, yet he mentioned that the agreement regarding electricity lease contracts was signed by the previous government, adding that the issue of debts had been dealt with.

Sources from the electricity corporation spoke of contracts with a temporary, off-shore electricity company for the sum of $3.5 million per month, to deal with current shortages.

Media news said that the British electricity-generating company had threatened the Yemeni electricity ministry with disconnecting the supply to six cities if they did not pay the outstanding amount owing of $7.5 million. Reports spoke of a British company by the name of Jericho, that has been supplying parts of Aden governorate, Hodeidah, Hadramout, Amran, Taiz and Sayoun with electricity according to a contract between the company and the ministry for the past year.

Sources attributed the company’s measures to the Yemeni corporation’s failure to pay the sum of YR1.5 billion ($7.5 million) for electricity supply for the months of December and January.

Some reports disclosed that the Yemeni Ministry of Electricity and Energy and its corporation are suffering hard times, as evidenced by their failure to pay the British company, which sells huge amounts of electricity used in lighting and operating industrial plants in the previously mentioned areas.

Critics of the electricity ministry said that it could have supplied these cities with power by building two generating stations at the cost of $60 million, instead of paying that same amount to the British company for a one year supply.

Yemen suffers a 30 percent deficit in electricity supply, due to the expansion of urban areas in addition to the demand for energy from rural areas and projects. It signed a contract with the British company in mid-2006 to supply the six areas with power.

Dr. Buhran told the Parliament that the Ministry’s revenues do not cover the cost of electricity production, because the revenue rate is less than 25 percent of the cost. “The government pays a subsidy to cover this deficit,” the Minister said.

Wow. I have to say its impressive Mujawar admitted the gross theft of Yemeni public money in the form of smuggling subsidized oil. The World Bank said it first though.

1) Why not end the smuggling first then do the reduction in subsidies?

2) Reduction in subsidies should be accompanied by a rational government budget not one where 25% of public funds goes to administrative maintenance and 25% goes to military spending. Subsidies are another 25% of the public budget.

3) Beyond misappropriation of funds, corruption control is another component of economic reform. It should be accomplished before raising prices on diesel.

Yemen Times

Following Prime Minister Mujawar’s presentation to the parliament regarding the economic achievements of his cabinet during 2007, parliament members expressed fury and anger at the poor performance of the government, given the record inflation experienced during the year. The prime minister started his presentation by highlighting the economic growth and developmental achievements during the last three years, but he also stated that economic growth has declined from 3.6 % in 2006 to 3.2 % in 2007. He also explained to the parliament that the government is suffering from immense pressures due to the decline in oil production and in turn revenue.

Removal of oil subsidies

The Prime Minister also added that the government will be forced to remove oil subsidies due to the cost of the subsidies on the government budget; he stated that in 2005 subsidies constituted 23.5 % of the budget, dropping to 21.2% in 2006. However, he added that in 2007 the subsidy will exceed 30 % due to the increases in international oil prices. He also added that the World Bank states that less than 23% of the subsidy benefits the population living under the poverty line, indicating that the other 75 % of the subsidy simply goes to smugglers of refined oil products to outside the country. The prime minister also added that the government of Yemen has failed in putting a stop to five oil and diesel smuggles who smuggle refined oil products out of the country.

“I am not saying that we will remove all oil subsidies immediately, but I wanted to inform you about the challenges the government faces including the fact that 6000 billion Riyals of oil subsidies isn’t going to the poor, but only 4 % of subsidies is” the prime minister stated, adding that the government needs the help of the parliament in making the decision to remove oil subsidies.

In response, parliament members strongly opposed the notion of removing oil subsidies stating that the increase in oil prices will be accompanies by a price hike in all other products, which will increase inflation and become an economic and social catastrophe. Head of Al-Ishah parliamentary block Dr. AbdulRahman bafadhl stated that the Yemeni public will not be able to tolerate any additional increase in retail prices. While the head of the socialist parliamentary block Dr. Aydarous Al-Naqib stated that removing the subsidies is the opposite of what the public is expecting from the government, adding that holds the government responsible for any consequences of removing the subsidies, demanding that the government holds the corrupt officials and those who misuse public resources accountable and punish them instead of punishing the Yemeni people. He concluded his remarks by saying “we, and the government, complain of corruption but we’ve never heard of holding any corrupt officials accountable”.

Even parliament members of the ruling party were disappointed at the prime minister’s justification for removing oil subsidies, saying that the smuggling of oil is done through tankers coming to Yemeni ports and sailing across the sea, not smuggled by donkeys which the government cannot trace. While other parliament members denounced the government’s inability to put a stop to organized oil smuggling, unless the smugglers are a part of the government itself.

Parliament members mistrust in government

Parliament members continued to attack the prime minister’s presentation and government economic polities, MP Abdullah Al-Badani stated that he always feels suspicious and horrified whenever the government visits the parliament to present its achievements. He stated that he cannot see the economic progress the government is referring to while the value of the Yemeni Riyal is collapsing as opposed to other currencies, stating that the government economic policies are similar to a missile attack that aims at the destruction of the country, calling on the government members to go to the street and see the thousand who eat out of the garbage.

MP Sakher Al-Wajeh inquired why does the government have a monopoly on a single entity in importing refined oil products, adding that the government’s reliance on treasury bills to control the supply of money is a sign of economic failure. He also demanded an explanation why the government has monopolized import of scrap metal to only two selected businessmen, in turn driving many others out of business. MP AbdulRazaj Al-Hajri also commented on the prime minister’s achievement in giving raises to seven thousand retired political security officers, and said that we need seven thousand bakeries to feed the people, and this achievement is no achievement at all and the government needs to reprioritize.

MP Abdulkarim Shaiban stated that the economic development mentioned in the prime minister’s presentation is simply a myth and un true numbers, adding that the government has failed in preparing a business environment that succeeds in attracting investments, as evident by the declining investments coming to Yemen. He also added that the privet sector has become tired of continued restrictions on business and additional taxes.

Several other parliament members criticized the government for providing inconclusive information relation to other issues including security issues and the unrest in the south which have a direct baring on the economy. MPs also demanded that the prime minister revises his report and includes detailed information on the price hikes, how the proposed subsidy funds are going to be used if the oil subsidy is removed. The prime minister promised to resubmit his report in mid April.

So if Saleh’s son, Ahmed, head of the Republican Guard, was in control of this land, who is Qatari paying paid for the land, the government or Ahmed? Also how did the Republican Guard get 440,000 square meters of land? It was just there? No one owned it? Yemen Post

The General Authority for Investment signed an agreement with Qatari Al-Diyar Company for Real-estate Investment to implement Tilal Al-Rayan project at Faj Attan area in Sana’a.

Built over a total area of 440,000 m2, the project’s total costs are about $500 million and will overlooks most areas of Sana’a.

In the past, the land that will be used for the project was among the locations where building is not allowed and it belongs to the Republican Guard Forces. The project will be implemented as of next April. According to a release by the company, the project will include a five-star hotel, real-estate areas, commercial offices, luxurious villas and residential apartments.

Guardian

SANAA, Feb 11 (Reuters) - Yemen has no immediate plans to remove costly fuel subsidies despite budget pressures arising from declining oil output, Oil Minister Khaled Mahfoudh Bahah said on Monday.
He told Reuters in an interview that Yemen’s crude production would drop to 300,000 barrels per day (bpd) this year from an average 320,000 bpd last year, but voiced confidence that intensified exploration would reverse the trend and raise output to 500,000 bpd in the next five years.
The impoverished country on the southern tip of the Arabian peninsula struck oil in the 1980s but production has dipped since 2004 after hitting a plateau of 436,000 bpd.

(Read on …)

I first heard this name in relation to diesel smuggling. Then I heard he was President Saleh’s business partner, that Saleh is actually also a business man and openly involved in economic pursuits, and then later that Abdul-Rahim was the distributor for the fuel products. Now it seems he owes the government (the people) 2 billion YR and is getting more government contracts. Does Saleh as his partner openly profit from the government contracts, is it documented?

SANA’A - The Prime Minister gave orders earlier this month to the oil, electricity and trade ministries to sign contracts with the investor Tawfiq Abdul-Rahim to supply oil products to them, according to media sources last week.

The go-ahead comes after much disagreement between the businessman and the government, and claims Abdul-Rahim owes the government over YR 2 billion.
In May 2002 President Saleh ordered the cancellation of a contract signed between the Ministry of Electricity and the investors to supply the ministry with diesel and gas, according to the Al-Sahwa newspaper.
Amr Al-Arhabi, acting manager of the oil company, said that the decision was made in response to reports and recommendations made by the Central Organization for Audit and Controlling (COCA), which criticized the contract.

The paper quoted a statement published by the Al-Thawara newspaper on October 10 2004, in which the president’s directives were welcomed by citizens and workers in the company who threatened to lost their jobs due to the contract.
The paper pointed out that the President had also ordered the general prosecution investigate Abdul-Rahim, who it was alleged had been to blame for work stoppages at the Barah Cement Factory.

The President asked that the investor should also pay losses and damages caused by the mixing of gas oil with other materials. The Prime Minister also gave orders that action be taken to sue Tawfiq Abdul-Rahim.
The orders came after COCA issued a report in which the organization recommended the cancellation of a diesel contact between the Ministry of Electricity and Abdul-Rahim, due to the potential impact if the contract was implemented.

The paper said that executive documents reveal Adul-Rahim owed the government was YR 2,456,465,000.
The documents back up a memo presented by Al-Arhabi to the Deputy Minister of Oil, in which he said that Abdul-Rahim had not paid his company’s debts.

The Al-Sahwa newspaper also claimed another document, presented to the oil ministry from Al-Arhabi and Ahmed Sha’a, the Director-General of the Oil and Gas Corporation, rejected Abdul-Rahim following an agreement between a judge to allow COCA to return money from Abdul-Rahim, in accordance with the President’s directives.

apparently the money is already spent, so they need 2.2 billion US to cover this years expenses.

The YO doesnt really put this in context. hmmm But the News Yemen headline is “YR 451 billion supplementary budget for 2005 passed amid opposition uproar.”

The controversial supplementary budget, which equals about %45 of the original 2005 budget, had triggered heated debates between opposition and GPC parliamentarians for the last three days.

Some of the GPC parliamentarians expressed their disappointment in the government’s proposed supplementary budget by abstaining in the voting process. Among those was Abdulkareem Jadban, who justified his abstention in the vote by the failure of the government to deliver the promises and commitments it had given in 2004. “By abstaining, I protested the way the government dealt with the parliament as it continues to take it for granted. This is the third time that it spends more than it should and then demands from the parliament to approve and validate its actions by voting for any supplementary budgets it proposes.” he said.

Opposition member Ali Al-Warifi agreed with Al-Baadani and said that those who vote for such a huge supplementary budget without questioning the government are betraying the people who voted for them and are abusing their power ‘without giving a damn about it’.

“This action by the members of the ruling party encourages the government to continue its corruption and embezzlement of public wealth.” Al-Wafiri said, criticizing many of the GPC members of initially being against the supplementary budget in discussions, but contradict this by voting for it when the moment of truth comes.

More: this could put the government in a very difficult position, particularly as it had already spent this amount on “luxurious cars, high per-diem travel allowances, financial awards and aid packages to government officials on the expense of the public”.

Observers noted that surprisingly enough, this is the first time the parliament stood up, with many members of the ruling party, against the ‘rampant’ corruption of the government, which used to take the parliament for granted when it comes to votes on budgets it had proposes.

OK a better one from the YO here, details more of the infighting among the parties.

More and more articles on this: (Read on …)