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Fiscal Regime Development History, Summary
- Necessity to Develop The Fiscal Regime to Accommodate With:
- E & P. Status and Development.
- International Markets Development and Requirement.
- International Competition to Attract New Investments.
- 1st Agreements Generation Coincide With First geological studies in the late 19th Century (Early Fifties).
- 2nd Generation Early Sixties and Seventies. No Discoveries Achieved.
- 3rd Generation Resulted In 1983 1st commercial oil discovery (Hunt at Marib). 1991 billion barrel Masila discovery (Canadian Nexen Petroleum Yemen, previously Canadian Occidental).
- 1987 oil export started.
- 1987 Shabwah discovery (Russian) Service Contract.
- 4th Generation 1991 – 1995 No Successful Results Achieved (Difficult Terms).
- 5th Generation Last 10 years continued exploration success and field developments (Total 3rd, DNO, Dove etc.) making use of existing infrastructure:
- Marib - Ras Issa pipeline (438 km)
- Masila - Ash Shihr pipeline (138 km)
- Shabwah-Rudhuma pipeline (207 km)
- Development of Complimentary Contracts (Facilities Usage Contract), with The Aim to Encourage Marginal Fields Development.
Economic policy
It is based on marketing mechanism and economic freedom: and support the initiative to investment.
The economic policy ensures private ownership which cannot be forfeited except for public interest and then with fair compensation. The investment law has created many investment opportunities and provided incentive to local and foreign investment in all aspects of the economy.
Economic Indicators
Yemen is classified within countries that is less growing, however it is considered as a country that is full of main economic resources which have not been exploited economically, especially in oil and gas field, fisheries and different mineral resources.
The most important economic indicators in Yemen are the following:-
Agriculture and fishing constitute the rate between (15-20) % Of the gross domestic production where cultivated areas considered (3%) of the gross republic areas so the planting areas constitute exactly(67.9%) of the cultivated areas
Mining and quarrying industries and manufacture industries constitute a rate between( 30-40) % of gross domestic production, and the extraction and refining of oil represent the largest part of this rate and the contribution of petroleum sector of domestic production reaches the rate (25-35)%, and the average of petroleum production in Yemen reaches (435.000) a barrel in a day.
Yemeni economy grows rapidly and the average rate of its annul growth ranges between ( 10-15)% of current prices which reach by the account of constant prices to the rate (2-4)% annul, and the average of a person's share from national production in 2002 reached 473 $).
Exports constitute( 33.4%) of gross domestic production in 2002 and imports constitute (29.3%) of gross domestic production in 2002. Therefore, the exposure ratio for Yemeni economy reached ( 62.7%) approximately.
The most important exports, in Yemen, are in the field of crude goods that constitute (94-97)% of gross exports whereas direct consumption goods constitute the rate between (1-4)%, and the crude goods at imports range between(55-60)% of gross imports that constitute direct consumption goods (15-20)%and the capital goods constitute (20-25)%.Yemen imports from Arab countries between(30-40)% of gross imports whereas its exports to Arab countries range between (5-10)% of gross exports to abroad . Asian countries, not Arabian, are considered as the largest market for Yemeni exports. Yemen exports to them between (70-85)% of gross exports.
Petroleum Policy
Diversify the source of revenue by;
- Increasing proven reserves to balance declines in existing fields.
- Promoting new areas for exploration.
- Evaluating PSA terms and procedures to accommodate the International Petroleum Industry requirements.
- Introducing tax and customs exemptions and free transfer of funds and revenue.
- Encouraging the private sector to play an important role in all stages of hydrocarbon development.
- Encouraging The Development of Marginal Field Discoveries Through Reduction of Investment Requirement By:
- Making Use of Extra Capacity of The Existing Infrastructures Against Nominal Fees for Usage.
- Opening New Horizons For Investment Jointly or Severally With Private Sector in Upstream Projects (PSA, Gas, Petroleum Services) as well as Downstream Projects (Transportation, Refining) as First Step to Develop Such Industry.
- Easy Transfer of Technology by Participating In The Contractor Share and Introducing Carried Interest.
- Develop Yemenization Plans To Replace Expatriates In The Working Company.
- Active Control of The Costs of Operations Through Operating Committees.
Visas
The visitor can get entry visa to the Republic of Yemen from the Yemeni Embassy or Consulate in his country and payment of a minimal Consular fee. Prospective visitors from countries with which Yemen has no diplomatic or consular representation, an extendible 96 hour transit visa from the port of entry can be obtained. Upon arrival, the visitor is given one month residence permit. There is no need to register at police stations or to apply for an exit visa during the scheduled one month period. All travelers have to pay an airport departure tax. This applies to Yemen nationals and visitors alike.
Banking Services
Modern and reliable Banking services are available in most cities. Major cards are available, and honored in larger hotels, and banks.
Telecommunications
All the Yemeni land is covered by a modern Telecommunications network that provides worldwide direct access telephone calls, facsimile service, and Internet service.
Airline Services
The Yemeni capital, Aden is only a seven-hour flight away from the major European airlines fly to the Yemeni international airports, and the Yemen Airline flies to major Yemeni cities, remote areas, and the Soqatra Island.
Transportation services
A descent network of Asphalt, and dirt roads links all major and secondary cities. Public and private companies provide first-class daily coach services between major cities. Taxi stations also provide their services around the clock.
Accommodations
Tourist hotels are available in all major cities, and many secondary cities, with service levels ranging from one-star to five stars. Some hotels are local subsidiaries for international hotel chains.
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