Yemen: Economy


Most Yemenis are engaged in agriculture and herding. N Yemen produces grain, fruits, vegetables, khat (a stimulant-containing shrub), coffee, cotton, and livestock (sheep, goats, cattle, and camels) but is dependent on imports for most of its essential needs. Terraced agriculture, dating from ancient times, is still practiced. S Yemen is one of the poorest areas of the Arabian peninsula. The climate is arid, and only a fraction of the land is arable. Pastoralism is prevalent in the south, and the greatest amount of industry is located in Aden. There is fishing, food processing, salt mining, and small-scale manufacturing, including cotton textiles, leather goods, handicrafts, and aluminum products. The country produces and refines petroleum, and oil export revenues have boosted the economy since the late 1980s, but oil reserves are now being depleted. Imported oil is also processed into petroleum products for export. Other exports include coffee and processed fish. Foodstuffs, live animals, machinery, and chemicals are imported. Important trading partners include China, the United Arab Emirates, India, and Switzerland. Yemen's GDP is supplemented by remittances from Yemenis working abroad and by large amounts of foreign aid. One of the principal reasons for Southern Yemen's merger with (Northern) Yemen in 1990 was the steady decline of its economy and the loss of Soviet political and economic support. Pervasive corruption, however, has hindered new economic development in unified Yemen.

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