Saudi in Yemen declines by 80%

By Abdul-Aziz Oudah

Sana'a, Apr 12, 2011- Saudi Arabian investment projects in Yemen has dropped by 80% in some sectors since the outbreak of political unrest earlier this year.

Council Abdullah Murai, chairman of the Saudi-Yemeni Business Council, said that Saudi investment in Yemen totals US$4-billion. He said that Saudi business assets in Yemen had not been affected Murai said that the assets of Saud investment in Yemen were not damaged but operations have been affected. In particular, the tourism sector’s investment dropped by 80%. “Tourism almost stopped completely.

Many foreign experts who manage production lines at factories and who oversee construction of cement factories owned by Saudis have left. This impacts on operations,” he said.

Half of Saudi investment in Yemen is focused on tourism real estate while investment in food and industry sectors total US$1.5-billion and US$500-million is invested in other sectors.

«There are Gulf real estate projects in Yemen worth US$800-million but it stalled despite the fact that 70% of it has been completed,» said Murai. Abdullah Bugshan, deputy chairman of the Saudi-Yemeni Business Council, said that Saudi investments in Yemen did not face any risks though. The investment decline was a result of political instability and not direct threats on Saudi businesses.

«Risks are only during the loading and exporting of goods while assets remain untouched. These investments are concentrated in the industrial sectors in a number of Yemeni cities such as Sana›a, Aden and Marib,» said Bugshan. Saudi investor Omar Babiker said that Saudi investments and projects in Yemen did not record any damage so far.

«Saudi investments in Sana'a and Aden are still safe and were not affected by these events,» he said. Official sources in Yemen said that the government budget deficit could rise to US$4-billion by the end of this year and it is expected to decline public revenues as a result of slowing the movement of trade and investment during the past three months.