Yemen Economic Forecast

Yemen Economic Outlook

September 8, 2020

The economy will have deteriorated notably so far this year. The ongoing civil war, which has devastated infrastructure and development for over five years, has left Yemen ill-equipped to face the coronavirus pandemic. Moreover, severe flooding in April and again in August, coupled with swarms of locusts in recent months, suggests agricultural production is taking a severe hit. Meanwhile, rising food costs and a depreciating rial against the USD in the black market, in addition to the economic downturn in Saudi Arabia hammering remittances and government finances, are likely battering domestic demand. On a brighter note, on 1 September the EU and the United Nations Development Programme signed a partnership agreement worth USD 82.4 million to strengthen local authorities’ fight against poverty and foster long-term development.

Yemen Economic Growth

Economic activity will continue to collapse in the coming months, as the coronavirus continues to spread both infection and uncertainty. Moreover, the ongoing conflict will aggravate the downturn and slow a future recovery, which itself is highly dependent on available levels of international aid. FocusEconomics panelists project the economy to contract 4.8% in 2020, which is down 0.5 percentage points from last month’s forecast, and to grow 3.9% in 2021.

Yemen Economy Data

2015 2016 2017 2018 2019
Population (million)28.329.130.030.831.6
GDP per capita (USD)943849806866-  
GDP (USD bn)26.724.724.226.7-  
Economic Growth (GDP, annual variation in %)-30.5-14.6-10.0-1.3-  
Fiscal Balance (% of GDP)-10.0-9.2-5.3-6.3-  
Public Debt (% of GDP)65.579.684.364.8-  
Inflation Rate (CPI, annual variation in %)22.021.330.427.614.7
Policy Interest Rate (%)15.0015.0015.0027.0027.00
Exchange Rate (vs USD)215.2250.2250.3250.2250.4
Exchange Rate (vs USD, aop)215.0241.0250.3250.2250.2
Current Account (% of GDP)-9.8-3.6-0.2-1.9-  
Current Account Balance (USD bn)-2.6-0.90.0-0.5-1.2
Trade Balance (USD billion)-6.1-6.5-6.1-7.0-8.9
Exports (USD billion)
Imports (USD billion)
Exports (annual variation in %)-81.7-15.2121-50.25.1
Imports (annual variation in %)-
International Reserves (USD)2.01.0-  -  -  
External Debt (% of GDP)27.428.529.826.4-  

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Yemen Facts

Value Change Date
Exchange Rate250.40.0 %Dec 31
Stock Market0.60.0 %Dec 31

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