Yemen war causes billions of dollars in losses

By Faisal Darem in Sanaa


The war in Yemen has inflicted heavy losses on the country's economy and infrastructure, according to a recent government report. [Photo courtesy of Mohammed Qaatab]

A recent report by the Yemeni Ministry of Planning and International Co-operation estimates the losses inflicted by the ongoing war at more than $50 billion, though experts tell Al-Mashareq the actual cost could be much more.

The economic losses caused by the war are estimated at $25 billion in physical assets and infrastructure, according to the September 18th report.

The report also estimated cumulative losses in GDP at $32.5 billion, noting that the collapse of the general budget in 2017 and decline in exports exacerbated the economic situation.

Cumulative losses in public revenues amounted to $11.4 billion in 2016-2017, the report said, noting the suspension of development and social expenditures, including state employee salaries and operating expenses of essential social services like health and education.

Big losses

"These figures, although catastrophic, remain only estimates as the war is still ongoing," said Deputy Minister of Planning and International Co-operation Mohammed al-Masouri.

"No field damage evaluation and assessment has been done to date, only partial assessments and over a [limited] time period, and thus there are variances in the damage estimates," he told Al-Mashareq.

The ministry relied on data it received from parties that did not conduct damage evaluation and assessments, he said, adding that the estimates in the report were reached based on a study of a number of conflict zones and for limited time periods.

"The size of the losses in all sectors far exceeds the estimates," said al-Masouri.

Calls to stop the war

Still, "these estimates give the UN and the international community an idea about the magnitude of the war’s impact on the country’s economy", Taha al-Faseel, economics professor at Sanaa University, told Al-Mashareq.

A full assessment of the material and human losses can only be done after the cessation of hostilities, he said.

"These estimates do not reflect the actual figures, which increases the international community’s responsibility to work toward putting an end to the war and the suffering of citizens," he added.

There are larger costs related to the collapse of the education system and the health sector, al-Faseel said, noting that there are four million children outside the education system and three million internally displaced people (IDPs), not to mention the unprecedented spread of diseases and epidemics.

"The actual cost of what Yemen lost is comparable to the cost of investment projects that existed [before the war]," he said, adding that the consequences of losing those investments are evident in the rise in the unemployment and poverty rates.

Siege undermines economy

The report reflects "a major humanitarian crisis in Yemen that has hit all sectors and is reflected in the economic figures that show the size of losses suffered by Yemen", economist Abdul Jalil Hassan told Al-Mashareq.

The war and resulting siege have restricted foreign trade, production and the export of oil and gas, and hindered the work of both the public and private sectors, he said.

"This has led to an increase in the poverty and unemployment rates to their highest levels," he added.

The suspension of payment of state employee salaries and the operating expenses of essential social services that affect the lives of the most vulnerable citizens, has exacerbated human suffering in the country, Hassan said.

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