News / Economy

Yemeni Business Leaders Search for US Investment

Jeff Swicord
In a conference room of General Electric Company in downtown Washington D.C., 10 of Yemen’s most successful business leaders sit around a large table.  They are on the second stop in a five-city tour led by U.S. Ambassador to Yemen Gerald Feierstein to attract American business investment to Yemen.  They are in search of American know-how in power generation, renewable energy, agriculture, water desalination, and waste water treatment.    

The guests and their host say Yemen is at a critical juncture in its history.  Most Western headlines about Yemen focus on drone strikes and the terrorist activities of the home-grown al Qaida in the Arabian Peninsula.  But in February of this year, President Ali Abdullah Saleh was swept from power on the coattails of the Arab Spring.  His vice president, Abd-Rabbu Mansour Hadi, heads up a transitional government preparing for elections in February of 2014.  

Many regional experts think the timing is right to take on Yemen’s political, economic and security problems. 

“We believe on the one hand strategically [that] helping the Yemeni private sector develop is something that is going to contribute directly to security and stability in Yemen, and therefore more broadly in the region and the world,” said Ambassador Feierstein.

Yemen faces many challenges.  One of the poorest countries in the Middle East, 40 percent of the population faces food shortages.  There are one million acutely malnourished children in the country at risk of permanent mental and physical disability.  A third of the population is unemployed.  Militant groups have attacked government infrastructure and aid convoys.  Regular blackouts occur in the capital city Sanaa.  Roads and other infrastructure are often primitive, and clean water is in short supply.

“I think it would be challenging for American business to establish themselves in Yemen because of underlying structural concerns in the country,” said Katherine Zimmerman, a Yemen analyst at the American Enterprise Institute in Washington.  “If you start looking at what businesses need to operate in an efficient manner, Yemen’s infrastructure is not designed for that at this point.”

But Yemen’s business leaders argue that is precisely the point.  They say the change in government is transforming Yemen’s business climate.  The new government will be more open and transparent.  Changes in laws are making it easier for foreign companies to invest in the country, and companies from Europe and South Asia have already come calling.

“Yemen is still pure.  It is as they say, ‘a virgin land.’  We have to do everything from scratch.  So, it is better for those companies who would like to invest to come right now.  Now is the correct time, rather than waiting until later when the opportunities are gone,” said Wael Zokri, CEO of Griffin International, which specializes in information technology security.

There are still concerns about political stability in the country.  Groups loyal to former President Ali Abdullah Saleh are still active.  And there are other groups loyal to different members of the former government.  Under the terms of the transition, a national dialogue is to be held soon to form the structure of the new government, review the constitution, and decide on a presidential or parliamentary system.

“I think that there is quite a possibility that one of these actors will make a move that will throw the transition off course,” said Katherine Zimmerman.  “And so many have chosen to sit back, wait until some of those decisions are made, and then they will get into the game.”

The business leaders stress the security situation is much improved over a year ago.  While they acknowledge al Qaida in the Arabian Peninsula is still a threat, it no longer controls so-called Islamic emirates in some of the population centers in the south.  The business leaders say U.S. drone strikes and counterterrorism training provided to the Yemini military are making a difference.

“There are challenges, we cannot deny.  But we have done a lot and are willing to do much more.  Not only in the government sector, but people are fed up with these problems,” said Ahmed Jumaan, managing director of Jumaan Trading and Investment Company.  “When you compare the situation last year to today, you would find we are much better off.  So that is why we are here with confidence to call and request American partners to come.”

The business leaders say their reception in the U.S. has been very positive.  And their schedule is filling up quickly.

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