Interviewed by Hakim Almasmari
YEMEN POST STAFF
Yemen Post: Tell us about Shibam Holding?
Saad Sabrah: Shibam Holding is the recently established investment arm of the government of Yemen and it is a state-owned enterprise. It is the first holding enterprise. It was established under the public corporations law in Yemen. Yemen has 150 state owned enterprises. Shibam Holding was established in April 2008. The idea behind Shibam Holding is to create a centralized unit to manage and implement investment activities on behalf of the government of Yemen. It is not a promotion agency or a facilitation agency. It is a wealth management agency. It works hand in hand with other agencies which are in charge of facilitation and promotion like the General Investment Authority and Lands Authority.
What is the World Bank’s position of your cooperation?
Part of the reform program of the government of Yemen is to enhance business enabling environment for investment and the inauguration and establishment of Shibam Holding is one step towards doing so and it was supported directly and firmly by the World Bank Group. Now, there is a lot of misunderstanding of the role of Shibam Holding as far as governmental entity taking over lands and handing them over to investors. It was created to facilitate the picture, but this does not mean that Shibam does take ownership of all lands as it basically decides the strategic places where investment must take place. The investment law in Yemen offers opportunities for investments to take place in Yemen and to hand out lands to investors who are investing more than $10 million depending on the nature of investment. But the handing over of lands has been giving through freely basis or on a long-term lease contract between the government and the investors.
You told media that Yemen will not be affected by the global crisis; however, some experts say the opposite?
What I said clearly is that Yemen was not involved or part of the international mortgage financing arena which was the cause behind the current crisis. I also said that Yemen does have ingredients that can be utilized to boost the financial crisis positively because Yemen was not part of the global mortgage finance arena. Nowadays, after the financial crisis, Yemen can stand out as a favorable place because Yemen is a cash market. Yemen has a lot of demand for activities that cannot happen in other places due to the financial crisis. I am saying that because of the financial crisis – despite all the negative effects – Yemen is no longer at the bottom of the list. Yemen is a potential area to go to.
In 2004, the government announced that more Gulf countries will invest in Yemen; however, that did not happen the way experts thought it to happen?
In 2004, the situation in Yemen was much better than how it is right now in terms of revenues that government generated and the situation as a whole, but Yemen is attractive for investors. More and more Gulf-based investors wanted to come to Yemen because there were a lot of reform-oriented programs the government was doing. There were too many reasons behind what happened after 2004 that prevented things from taking place now. I can assure you that between 2004 and 2008 the government of Yemen has done all it has to do in terms of providing the necessary facilities and it simplified procedures towards attracting investors, but the issue is that we lacked follow up, monitoring and evaluation. A lot of investors came, registered and were offered licenses and other necessary means to start businesses, but a large portion of these investments did not actually happen on the ground. Inflation was another reason behind investments not taking place in Yemen.
In your experience, do foreigners feel ease when investing in Yemen now?
I would say that we are still challenged. I would say that foreigners I worked with in the past found Yemen to be an easy country to work in once they had set foot on the ground, but we need futuristically is more shaping out the image of Yemen so that it is not perceived as such. The problem is really how Yemen is perceived. Yemen is perceived as a difficult country to work in, while, in fact, Yemen is not so and this has shown in the past two or three years. We have been able to attract $11 billion of investments in Yemen in different sectors including oil and gas. LNG is one example that can be demonstrated. It is a four-billion-dollar project that people thought would be impossible to take place. You can refer to the statistics of the General Investment Authority to find out that there are actually investments coming to Yemen.
The Southern crisis, would it effect business in Yemen?
Of course, it will affect business in Yemen. If the political arena in Yemen is affected, the economy is affected; it is how the conflict in the South is being perceived by the international media. It will definitely affect our situation in Yemen. We try very much to demonstrate that Yemen remains a safe haven for investments despite all the conflicts that are taking place.
New businesses and investments take place every month in Yemen and unemployment continue to rise, how do you explain that?
There needs to be much more coordination between new investments taking place in Yemen and linking them to the necessary impact. Linkages programs that can be created between investments which take place in Yemen and the type of positive impact that will be created for the economy. Poverty and unemployment are increasing for many other reasons including the economic crisis and depleted oil, etc.
Local businessmen still complain of bribes when investing, what is your comment on that?
I would ask to be a bit clear about what you mean by bribes.
Having difficulties in getting licenses without bribes?
We have challenges to face. I hereby speak on behalf of the government – a typical third world country with a lot of procedures that have to be taken care of. We have a lot of retyping that we have to take out and that retyping process involves some activities here and there that are not acceptable to most investors and I agree that there are some challenges we have to face. As we move forward, we are trying to simplify all procedures and to create a friction free environment between the investor and the governmental officials and therefore minimizing any types of corrupt transactions.