Officials reviewed governmental efforts to improve the business environment in Yemen including representatives from the Ministry of Industry and Trade, Tax Authority, Customs Authority, General Authority of Land Surveying and Urban Planning, and the Central Bank of Yemen, which reflects the government's desire to reform these bodies and its legislations in order to attract more investment projects.
This came during a press conference chaired by Dr. Yahya al-Mutawakel, the Minister of Industry and Trade, which was held last Wednesday.
Al-Mutawakel confirmed the improvement of the business and investment environments. Governmental efforts are not only aimed at improving the situation of Yemen in the indicators of international reports, but also to facilitate and simplify the procedures on the ground in order to contribute to attracting more investments from the national, Arab, and foreign markets. He continued saying that attracting more investments will help to raise the rates of economic growth and create more employment opportunities, especially for young people, which will contribute to alleviating poverty and reducing unemployment in Yemen.
He pointed out that the meeting with the media aimed to explain the steps and actions taken by the Ministry of Industry and Trade and other governmental bodies during the past 12 months, from July 2008 to June 2009.
Al-Mutawakel said that, "These efforts aim to improve the business environment in Yemen which will contribute to the reduction of non-commercial risks faced by the various projects and activities. In this case, the banks will be enabled to finance these projects and activities."
"Furthermore, small and medium industries and projects will be the biggest beneficiaries of these efforts, due to their ability to overcome obstacles they face compared to large companies and projects," al-Mutawakel said.
Al-Mutawakel, reviewed the successes achieved by Yemen related to the "Doing Business 2009" report, in which Yemen was ranked 98th globally in terms of business production, as opposed to its 123rd rank last year. This advance is seen to be because of its efforts related to facilitating procedures to promote new businesses. In this aspect, Yemen jumped from the 178th rank last year, to the 50th rank. "In order to meet private sector demand, we are focusing on reforming four bodies whose outcome will be reflected in the tenth indicator of the Doing Business report. These bodies are the Justice Ministry, Customs Authority, Tax Authority and the Central Bank of Yemen.
This achievement presents a major challenge to make further efforts and reforms in order to maintain the level currently achieved by Yemen in the international reporting, particularly related to the Doing Business report 2010.
The ministry is working to finalize simplifying business procedures. For example, we have launched an automated system for recording all brands in collaboration with the International Finance Corporation to enable businessmen to register their brands online.
"These are the most important actions and reforms undertaken by the ministry during the last period to complete the agreements of understanding with both the Chamber of Commerce and Industry in the capital and the Social Insurance Institution and Tax Authority," al-Mutawakel. He continued saying, "The outcome of this agreement will enable traders to obtain a tax number, a tax card, and a membership card with the Chamber of Commerce directly, through a single window in the Ministry.
"It has also been attached to the follow-up forms with each transaction to make sure of the implementation of the decrease of transaction time from 63 days to five days only," he said.
He explained that the Ministry has completed the process of unification of the registration form to apply to all those represented at the single window, after review and approval by them, as well as the completion of construction works of the window itself at the Ministry.
He pointed to the Cabinet's approval of the amendment to Article 245 of the commercial companies law, which currently requires the establishment of limited liability companies by issuing a decree from the Minister of Industry and Trade, to be suggested that the general Observer will be responsible for the establishment. He expected debate on this amendment to reach the Parliament soon.
The Minister praised the cooperation of others from the Council of Ministers and the Office of the Presidency of the Republic, as well as the Italian government, which contributed to the implementation of the second phase of upgrading the trade sector in the ministry, the United Nations Development Program, and the International Finance Corporation for their technical support for the reform process.
For his part, the Head of the Customs Authority, Dr. Ali al-Zabeidi, reviewed the reforms achieved during the past 12 months, to minimize and reduce the number of documents required for clearance of goods to four documents only. He said, in addition to the elimination of Consular authentication of trading documents, in accordance with the provisions of the draft amendment to the Customs Act by cabinet.
He indicated that the Authority began a selective application of the system and risk management of the inspection of goods, where the application is currently in the six customs outlets.
Al-Zabeidi pointed to the single window system at customs, which is dealt with at all of the relevant agencies, to facilitate and simplify the procedures for the release of the goods.
"We automated the submission of affirmation of customs clearance where it is currently providing the data electronically by all importers and exporters to the customs services directly through the network," Al-Zabeidi said.
In terms of tax reforms, Dr. Jamal Sroor said that the most important action taken by the Tax Authority during the last period was the Cabinet-approved draft of the income-tax law. This draft decreased income-tax from 35 percent to 20 percent for companies, and 15 percent for investment projects.
Ziad al-Kowsi, Deputy of Land Registration at the General Authority of Land Surveying and Urban Planning, said that, "We reduced the number of procedures to register property to four instead of seven, and the time for achieving registration at 15 days maximum, instead of 19 days. He stressed the reduction of the property transfer tax from the current level of three percent of the value of the property to one percent.
Al-Kowsi pointed out that Yemen has occupied advanced ranks in terms of the registration of property, 48th internationally and 6th among Arab countries.
Al-Kowsi noted that the Authority started the installation of machinery and equipment for an information center to prepare for the launch of automated records and documents of real estate.
In terms of the reforms achieved by the Central Bank of Yemen, Nabil al-Montaser, Deputy Sub-Governor, pointed to the automated system of credit information, enabling the Central Bank of Yemen to collect information on all loans as well as to collect credit information for both individuals and companies. He said that this system will help the banking sector to establish positive lists of credit information, and black lists which will contribute greatly to reducing the credit risk of banks operating in Yemen.
By Faisal Darem
© Yemen Observer 2009
