Our comprehensive assessment of Yemen's operating environment and the outlook for its leading sectors are formed by bringing together a wealth of data on global markets that affect Yemen, as well as the latest industry developments that could impact Yemen's industries. This unique integrated approach has given us an impeccable track-record for predicting important shifts in the markets, ensuring you’re aware of the latest market opportunities and risks in Yemen before your competitors.
Yemen Country Risk
We expect the formation of a fragile federalised state in Yemen, and the political situation will remain highly unstable over the coming decade. While not our core view, we flag significant risks of a return to civil war and a de-facto break-up of the state.
The economic outlook is uninspiring, with growth remaining sluggish over the 2015-19 period. Our core scenario sees business activity continuing to be negatively impacted by civil unrest, while persistent attacks on the country's hydrocarbon infrastructure will weigh on exports.
Key Risks To Outlook
Any further disruption to oil or gas exports would weigh heavily on the external position. Yemen's current account dynamics remain precarious; with minimal inflows of capital on the financial account, a...
Yemen Industry Coverage (3)
Defence & Security
Yemen Defence & Security
BMI is anticipating further turbulence in Yemen over the course of 2015, as President Hadi has faced significant challenges to his authority and as the government finds itself in a crisis following the Houthi's capture of the capital Sana'a in 2014. We think Al Qaeda on the Arabian Peninsula may potentially exploit the crisis to seek out support in Sunni areas and note that AQAP has increased its attacks against the Yemeni military and international interests in the country.
Since September 2014, when the Houthi rebels took control of government institutions in Yemen, the political and security situation has deteriorated. We are not expecting improvement, but rather a worsening of the security climate. We do not see the Houthis - a highly trained and well armed militia - returning to their bases in the north of the country. We note that the...
BMI View: An escalating security situation, with the Saudis mounting an air offensive in Yemen against the Houthis, AQAP seizing an airport and oil terminal in the south east and a government in exile, means the construction and infrastructure sectors are at a near standstill. Industry growth is expected to decline by a significant 22% in 2015 and not post a positive number till 2018 at our tentative forecasts, as the business and operating environment takes years to recover.
Key Trends And Developments
Highlighting the vulnerability of infrastructure and its political and strategic importance in the current situation, fighters from al-Qaeda in the Arabian Peninsula (AQAP) seized control of the Al-Rayyan International Airport and the oil terminal in the city of Al-Shihr in the south east province of Hadramawt in...
Oil & Gas
Yemen Oil & Gas
BMI View: Yemen's security environment continues to deteriorate and the impact on the oil and gas industry has been severe. As of June 2015, Yemen's oil and gas industry has been put to a stand-still, as all major oil and gas companies and facilities suspended their operations due to security concerns. We expect above ground risks to continue to impact near term production and challenge longer term efforts to boost investment.