Projects

Rethinking Yemen’s Economy

Project Duration

March 2017 – today

This continuous thematic focus of CARPO’s work builds on and further develops the results and experiences of the ‘Rethinking Yemen’s Economy’ initiative. The initiative was implemented between March 2017 and May 2025 in partnership with DeepRoot Consulting and the Sanaa Center for Strategic Studies, with funding from the European Union and the Kingdom of the Netherlands (until May 2023).

The objective of this focus area is to contribute to economic stabilization and sustainable development in Yemen. To this end, CARPO produces and publishes evidence‑based, policy‑relevant, and action‑oriented knowledge products on economic development in Yemen, with the overarching goal of constructively and effectively influencing local, regional, and international development and policy agendas.

Team

Dr. Marie-Christine Heinze

Partners:

Donor(s):

Publications:

36 Others 17.02.2026

Supporting Trade Finance in Yemen Amid Uncertainty

by Wadhah Al-Awlaqi and Maryam Abdulraman

The war has fragmented Yemen’s once unified, bank-led trade finance system into competing and politicized structures, driven by the suspension of oil and gas exports, severe foreign currency shortages, and the division of economic institutions. The …

35 Others 15.09.2025

Fostering Opportunities for E-Commerce Growth in Yemen

by Aylin Junga

Yemen’s e-commerce sector holds significant potential to drive economic growth and financial inclusion, particularly for women and rural communities, but faces major challenges, including poor internet connectivity, limited digital payment systems, …

34 Others 08.09.2025

Made in Yemen: A Strategy for Industrial Recovery and Economic Growth

by Saeed Bin Jalal and Ahmed Abdulkader

Before the war, Yemen’s industrial sector was characterized by small-scale, private initiatives, with 78% of establishments employing fewer than four workers and dominated by food, metal, and textile industries. Yemeni industry’s reliance on …

33 Others 11.08.2025

Unlocking Climate Finance for Fragile States: The Case of Yemen

by Musaed Aklan and Sahar Mohammed

Yemen is highly vulnerable to climate change, but the country’s ability to address its impact is severely hampered by limited access to international climate finance. Obstacles include the absence of clear criteria for fund distribution, …

32 Others 28.07.2025

Unlocking Innovation in Yemen: A Policy Blueprint for Supporting High-Growth Enterprises

by Jamal Nassar and Bushra Nasr Kretschmer

This RYE Policy Brief explores the potential role of innovation-driven enterprises (IDEs) - high-growth ventures built around scalable models and technology - in contributing to economic resilience in Yemen. While IDEs are not yet prominent in the …

31 Others 27.05.2025

Scaling Up Yemeni Exports

by Mohammed Kareem and Rafat A. Al-Akhali

Yemen’s export sector, long weakened by structural issues, has collapsed due to the ongoing conflict, with exports dropping 90% between 2013 and 2023—mainly from disruptions to oil and gas, which once accounted for 80% of export revenues. Though …

30 Others 03.02.2025

Supporting the Construction Contracting Sector in Yemen for Stabilization and Recovery

by Ghadeer Ahmed Al-Maqhafi

The construction sector in Yemen, despite being significantly impacted by political and economic crises and the effects of war, continues to be a crucial sector for the country’s recovery and reconstruction efforts. This RYE Policy Brief analyzes …

29 Others 23.09.2024

Enhancing the Role of Microfinance Banks for Sustainable Impact in Yemen

by The Sana’a Center Economic Unit

Yemen’s microfinance sector is undergoing a radical transformation. Despite initial success in empowering small businesses, the ongoing conflict has exposed deep vulnerabilities. Competition between the fractured central banks has driven a surge in …

28 Others 18.04.2024

The Impact of Flooding on Agricultural Communities in Yemen

by Musaed Aklan

Yemen’s agricultural communities face a perfect storm of growing ecological threats amid protracted conflict. Flash floods destroy farms, crops, and irrigation systems. Late rains risk drowning mature harvests, and waterlogged fields hinder root …

27 Others 06.02.2024

Empowering Local Authorities to Lead Economic Development in Yemen

by Ali Al-Lakmah and Rafat A. Al-Akhali

This RYE Policy Brief, which is based on discussions the Development Champions Forum held in Cairo in December 2023, outlines a set of recommendations aimed at empowering local authorities in Yemen to effectively provide services and lead local …

26 Others 18.12.2023

Challenges to Yemen’s Public Revenues

by Ned Whalley and the Sana’a Center Economic Unit

Since April 2022, the war in Yemen has mutated from a high-casualty conflict to a protracted stalemate with relatively stable frontlines. The current phase has been marked by the expansion of economic warfare, with the Houthi authorities shutting …

25 Others 20.04.2023

Scaling Up Solar Energy Investments in Yemen

by Akram M. Almohamadi and Rafat A. Al-Akhali

Poor electricity services remain a key barrier to sustainable economic development in Yemen, exacerbated by the ongoing conflict and related damages to the electricity sector’s infrastructure. Given Yemen’s high average hours of annual daily …

Others 01.07.2022

Addressing the Crushing Weight of Yemen’s Public Debt

For decades prior to the ongoing conflict, Yemen had been vulnerable to recurring budget deficits. The escalation of the ongoing conflict in 2014/15 has had a profoundly negative impact on Yemen’s debt position. Large-scale oil exports ceased, …

Others 01.03.2022

The Road Transport Sector in Yemen. Critical Issues and Priority Policies

Yemen is predominantly a rural country, with over 70% of the population living in 140,000 settlements in impoverished rural areas. Road transport is thus essential for the country’s development and overall economic growth. With only about 3,744km of …

Others 01.02.2022

Challenges and Prospects for Electronic Money and Payment Systems in Yemen

Yemen has a heavily cash-based economy with low levels of financial inclusion. The country’s formal banking sector is highly underdeveloped, undercapitalized and concentrated in urban areas, leaving it inaccessible for most Yemenis. Plans by the …

Others 06.09.2021

Local Economic Councils: A Tool to Improve Business Productivity in Yemen

From 25-27 January 2021, the seventh Development Champions Forum, held virtually, focused on the dire business environment in Yemen. To help address local economic challenges, the Development Champions discussed the possibility of establishing Local …

Others 01.09.2021

Improving Relations Between Central State Institutions and Local Authorities

Local councils are responsible for spearheading development projects and providing basic public services to Yemen’s population of more than 30 million people. The councils are particularly important in rural areas, where about 70 percent of Yemen’s …

Others 01.05.2021

Priorities for the Recovery and Reform of the Electricity Sector in Yemen

Poor electricity services in Yemen, even before the war, have been one of the key barriers to sustainable economic development and basic service provision (e.g., water supply, health care, education). This paper assesses the power supply system …

Others 29.04.2021

Solar-Powered Irrigation in Yemen: Opportunities, Challenges and Policies

Yemen is one of the most water-scarce countries in the world. Its agricultural sector is the dominant user of groundwater resources, accounting for around 90 percent of total consumption. Due to the current crisis, fuel required for pumps has become …

Others 11.01.2021

Impacts of the War on the Telecommunications Sector in Yemen

The telecommunications and information technology sector in Yemen is the second largest source of public revenue after the petroleum sector, and contributes important work opportunities, whether directly or indirectly, through its connections to …

Others 01.10.2020

Yemen’s Accelerating Economic Woes during the COVID-19 Pandemic

Since early 2015, Yemen has been almost completely dependent on three external sources to secure foreign currency inflows and stimulate economic activity: foreign humanitarian aid, Saudi financial support to the internationally recognized …

Others 02.06.2020

Economic Priorities for a Sustainable Peace Agreement in Yemen

The sustainability of a peace agreement in Yemen will, amongst others, depend on two critical insights: First, in a conflict that is largely over access to resources, the issues of distribution and control of those resources can make or break peace. …

Others 01.04.2020

Developing Yemen’s Fishing Industry

This policy brief summarizes discussions regarding Yemen’s fishing industry at a ‘Rethinking Yemen’s Economy’ workshop held in al-Mukalla, Yemen, on November 26-28, 2019. The workshop participants, among them numerous stakeholders in the fishing …

Others 01.04.2020

Microfinance in Yemen. An Overview of Challenges and Opportunities

This White Paper explores the historic development of Yemen’s microfinance industry and its players, as well as the impacts of the ongoing conflict. This analysis is followed by recommendations that address four specific areas – capacity building, …

Others 16.01.2020

Developing Human Capital

This Policy Brief summarizes discussions regarding Yemen’s human capital at a ‘Rethinking Yemen’s Economy’ workshop held in Amman, Jordan, on August 24-25, 2019. The workshop participants agreed that many of the obstacles to improving Yemen’s human …

Others 02.10.2019

Restructuring Public Finances in Yemen

This Policy Brief addresses the issue of public finances in Yemen, which have long suffered from an overdependence on energy exports, one of the lowest tax collection rates in the world, and chronic budget and balance of payments deficits. With the …

Others 23.09.2019

The Need to Reform the Public Sector Wage Bill

This Policy Brief addresses the issue of Yemen’s bloated public sector. Amid consistently large budget deficits, the inflated public sector wage bill is fiscally unsustainable and threatens to undermine economic recovery and future stability in …

Others 09.09.2019

Reforming the Business and Investment Climate

This Policy Brief addresses the need for private sector recovery in Yemen and gives recommendations for the improvement of the overall business and investment climate. While the private sector has shown a far greater degree of resilience than the …

Others 05.08.2019

Transitional Government in Post-Conflict Yemen

This Policy Brief offers recommendations to maximize the effectiveness of governance in post-conflict Yemen – whatever the composition or structure of the government. It presents three case studies on government models previously introduced in …

Others 23.07.2019

The Repercussions of War on Women in the Yemeni Workforce

This Policy Brief sheds light on the impact of the ongoing conflict in Yemen on women’s participation in the workforce. It finds that the protracted conflict has, on the one hand, pushed more women into the workforce and new labor markets, in some …

Others 01.05.2019

The Essential Role of Remittances in Mitigating Economic Collapse

This White Paper addresses the impact of Saudi Arabia’s increasingly restrictive handling of its expatriate workforce on the economy in Yemen. The kingdom’s policies, which have forced tens of thousands of Yemenis to return home, have resulted in a …

Others 08.04.2019

Reconstruction and Recovery in Yemen

This Policy Brief brings forward the results of in-depth discussions held by the Development Champions with the aim of developing recommendations and guidelines to ensure the reconstruction and recovery of Yemen is a comprehensive, effective process …

Others 18.03.2019

Economic Confidence-Building Measures – Civil Servant Salaries

This Policy Brief brings forward crucial recommendations resulting out of the fourth Development Champions Forum in Amman, held in December 2018. The Development Champions recommend that the Yemeni government resumes salary payments to all civil …

Others 05.02.2019

Priorities for Government Policy in Yemen

This Policy Brief outlines recommendations for the immediate priorities of the Government of Yemen, both to achieve quick wins and to prepare the ground for medium and long-term success. These recommendations are the outcomes of in-depth discussions …