The Yemeni Minister of Industry and Trade, Muhammad Al -Ashwal, revealed a disturbing indicators of an unprecedented economic collapse in the country, holding the Houthi group responsible for the exacerbation of the crisis since its coup against the legitimate government in 2014, as he put it.
Al -Ashwal stressed – in an interview with Al -Jazeera Net – that the industrial sector was subjected to almost complete destruction, while the commercial sector fell to meeting only daily needs, with almost total dependence on import.
The minister described the current economic scene as “catastrophic by all standards”, as a result of the destruction of the Houthis in the institutional structure and their imposition of an economic system that is fragmented between areas of influence, which led to the deterioration of the currency, the collapse of production and the high prices.
He stressed that part of the national economy has turned into “cross -border mafia networks” managed by the militia, in light of its forced acquisition of productive and financial institutions.
On the other hand, the minister revealed a government plan to stimulate the economy by encouraging the return of immigrant capital, developing industrial areas in Aden, Al -Makh and Mukalla, and rehabilitating employment through specialized technical institutes.
He referred to consultations with international organizations and a private sector for the reconstruction of infrastructure, with a focus on manufacturing, food and medicine industries as promising sectors.
In response to the decline in citizens ’confidence in the price monitoring committees, Al -Ashoul denied the existence of official“ committees ”, due to the high prices to the deterioration of the national currency, with a promise of urgent government measures in coordination with the private sector.
Regarding food security, Al -Ashoul noted the diversification of wheat importing sources to face global crises and recently improved fuel supply.
The minister emphasized that the Yemeni private sector plays a pivotal role in delivering food even to remote areas despite the challenges, and revealed the seizure of 2748 tons of corrupt goods during 2024, praising the cooperation of senior traders in reporting damaged materials.
The following is the text of the dialogue:
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First of all, how do you describe the features of the current economic scene in Yemen, in light of the sharp decline in the national currency and the high cost of living?
The economic scene in Yemen lives one of its worst historical stages, and this collapse began with the Houthi militia coup against the legitimate government in Yemen in 2014, and since then, the national economy entered into a state of sharp rupture, vertically and horizontally, where the institutional structure has disintegrated, and the shadow and the black market emerged as distorted and destructive alternatives to the official economy.
The scene in the form of two separate economic systems, contesting control of limited geographical areas, has become a very dangerous development that has recently seen the sliding part of the country’s economy to the grip of cross -border mafia networks, run by the militia, and harnessing the country’s resources to serve a devastating sectarian agenda. This group also deliberately destroyed productive institutions, prevented oil export, and assaulted the private sector, after it turned it into a continued entity that serves narrow factional interests.
All of these practices led to the deterioration of the currency, the high prices, the paralysis of production, the collapse of financial institutions, and the exacerbation of the fragility of the economic structure inherited originally from previous contracts, which makes the current scene catastrophic by all standards.
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How is this crisis reflected on the industrial and commercial sectors supervised by your ministry?
In fact, we are not just a crisis, but rather a integrated economic catastrophe that secretes successive crises. Industrial and commercial sectors by their highly sensitive nature towards political and security conditions, and this was clearly reflected in the almost complete collapse of the industrial sector, which was not satisfied with stopping, but rather became a direct goal for the Houthi militias, and a victim of armed conflict.
The matter exceeded the limits of military targeting, to reach the intervention of the coup authorities in the institutional structure of the industrial sector, through forced acquisition and threats to weapons, which led to the dismantling of the productive system. As a result, vital economic processes were disrupted, the state’s revenues decreased, and investments stopped.
As for the commercial sector, it was subjected to a significant deterioration, and its nature has changed remarkably, as the commercial activity declined to the limits of the daily needs of people, with almost total dependence on import, and exports to shrink to very modest levels.
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What are the most prominent urgent measures that the ministry intends to take to alleviate the suffering of the citizen, who has become spending more than 80% of his income on food?
The Ministry of Industry and Trade operates within the framework of the government program and with its dictated constitutional duties, in order to stimulate the commercial and industrial movement, encourage investment, and work to restore the immigrant national capital.
We have already started establishing councils for Yemeni businessmen in the countries of the Diaspora, and intensifying meetings with them to study the requirements of their return and settle their conditions in a way that contributes to enhancing their connection inside.
We also pay special attention to the sponsorship of the private sector inside the country, and we seek to stimulate the industrial areas, as the industrial zone in “Al -Alam” will soon be delivered to Aden to the developer, in addition to developing work in the industrial areas of the city of Mukha and Mukalla.
These efforts, in addition to the other ministry’s tasks, aim to revitalize the economic cycle, move the wheel of development, to create new job opportunities, raise the standard of living of citizens, and alleviate their daily suffering in light of the difficult economic conditions.
Part of the country’s economy has slipped into the grip of cross -border mafia networks, run by the militia, and the country’s resources are harnessed to serve a devastating sectarian agenda.
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What is the size of the damage to the industrial sector due to the war?
In light of the war, the question about the extent of damage is no longer the extent of the extent that it became about “what is left of the industrial sector?” The more accurate description of what happened is the comprehensive destruction.
The status of the sector can be divided into 3 categories:
- A completely destroyed part as a result of direct military actions.
- And part left the country rapidly, carrying national experiences that the state accumulated over decades.
- A third part turned into ruins, in which the wheel of production stopped, and it became subject to the extortion of militias through levies and acquisitions, especially under the name of the “judicial guard”, with the almost complete absence of local demand as a result of the collapse of purchasing power in the militia control areas.
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What are your most prominent plans to restart factories and rehabilitate employment?
The ministry, as part of the government’s trends, is currently working to reassess the investment law, ensuring the provision of effective incentives and guarantees for the return of investors.
We also continue our meetings with the private sector abroad, in addition to stimulating the industrial areas in the liberated areas such as Aden, Al -Makha and Mukalla. We pay special attention to re -establishing technical and industrial institutes, to qualify national workers with high efficiency that keeps pace with reconstruction and development needs.
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Are there partnerships with international organizations or investors to rehabilitate industrial infrastructure? What incentives do you offer?
The government is currently working to prepare a comprehensive vision to direct aid towards the development side, which contributes to addressing many aspects of structural deficiencies. There are ongoing discussions with the private sector about the destruction of factories, provided that this file is included in the reconstruction programs.
We are also working to prepare a preliminary vision that paves the way for setting a national strategy for the advancement of the industrial sector, in partnership with the private sector, and this vision will be part of the outputs of the “Investment Week”, which we aspire to constitute a serious and constructive dialogue platform between the public and private sectors.
We also hope to build effective partnerships with international organizations specialized in the industrial and productive sectors. As for the investors, there is an encouraging response, but activating this trend remains dependent on providing legal incentives and procedural facilities that guarantee a safe and stable environment to invest in industrial and productive sectors.
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What is the industrial sector that you see the most feasible to invest in it currently? And why?
The industrial structure in Yemen was and still is relatively limited, and large industries did not arise in the required manner, and this is attributed to the modernity of this sector and its almost completely dependence on the state, in addition to the weakness of national capital and the inclination of business composition in the country towards trade more than the industry.
However, manufacturing and food industries are among the most promising sectors currently, due to the stability of local demand and its flexibility in adapting to the conditions.
The drug industry sector is also a vital areas that require urgent development, because of its human and strategic dimension in light of the scarcity of import.
On the export level, the productive industries associated with natural resources, such as the fish and agricultural products sector, carries great potential for growth, and are among the feasible options to attract external and internal investment, especially with the availability of raw materials locally and the ability of these products to enter regional markets.
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How does the ministry deal with the crisis of wheat and fuel deficiency?
Food security is a top priority for the ministry, and, thanks to God, we have been able to overcome many challenges during the past periods, starting with the comprehensive closure in the Korona pandemic, to the repercussions of the Russian -Ukrainian war that brought about a global wheat crisis and prompted many producing countries to stop export. These crises were a strong motivation to search for alternatives and diversify the sources of import, which we have already started to work.
We are keen to encourage the private sector to increase its investments in importing basic commodities, especially wheat, from new and varied sources to ensure supply stability. As for the fuel crisis, the competent authorities have made great efforts in securing supplies, and as a result we witnessed a tangible improvement and relatively stability in this aspect.
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What are the concrete procedures to ensure basic nutrients reaching remote areas?
The nature of the Yemeni man is the trade and his experiences are great in this aspect, so marketing and reaching the farthest regions comes within the advantages of the Yemeni merchant.
The private sector has an amazing skill in delivery and transportation, with our appreciation for the difficulties of roads and its erosion and the worrying of transportation, but it plays the role and more, and our offices in the governorates play a good role and work to study markets and determine needs. I can say that we do not suffer from delivering food to remote areas.
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According to an opinion poll we conducted before this interview, more than 80% of citizens see that price monitoring committees are unsuccessful … What is your response?
There is no failure and there are no price control committees, but rather departments in the ministry’s offices in the governorates, and all that happens is that the collapse of the currency in front of foreign currencies leads to a high import bill and erosion of the purchasing value of Yemeni riyal.
But in the ministry we try to approach and reach the fair price of commodities, which is an extremely important and difficult issue with the deterioration of exchange rates on a daily basis, which makes maintaining a fair price difficult, and we have received many complaints from merchants whose commercial activities have risen, and the high import value of products.
We will prepare a set of government interventions that reduce the high prices of basic commodities in coordination with the private sector.
The collapse of the currency in front of foreign currencies leads to a high import bill and the erosion of the purchasing value of the Yemeni riyal.
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Does the ministry have official statistics on the size of corrupt or imitation goods that were seized during the past year?
Yes, we have statistics about this, the commodities that were seized, seized and destroyed during the year 2024 (2748 tons) with the need to clarify that these goods may have been corrupted due to certain conditions in storage and long interruption of electricity.
Most of the merchants, with a self -initiative, communicate with the Ministry to report their corrupt goods to be destroyed in the places designated for that, and we often find cooperation from the major merchants, but it is less with retailers, and we cover the matter through the field descent at the level of all governorates.
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What about the official position on the controversy that was raised at the beginning of this year about the corrupt wheat shipment in the port of Aden?
As for any corrupt shipment in the port or customs outlets, we rely on a capable government apparatus, which is the Yemeni Authority for Standards, Metrology and Quality Control, and it is the one who decides and issues the technical report according to the regulations. So there are a lot of wheat shipments that were returned to the country of origin and some of them are related to international organizations, so it is left for technicians. There are procedures organized for intercepting and searching for tight laboratories.
