An analytical and evaluative study of economic reform program of the international monetary fund and World Bank and their suitability to the Yemen economy

Abstract

Yemen economy is one of the most essential components in making the past, the present and the future for Yemen. This economy has undergone and suffered many problems, difficulties and bottlenecks since a long time and until today due to poor management and economic inefficiency characterized by a large public sector with high budget deficits, balance of payment problems and macro economics spirals such as high inflation rates, and structural weaknesses. This was due to many reasons imposed by the actual material status of the possible abilities, capabilities and resources or due to the human factor in the various developing stages. These affected growth, investment, increased capital flights, eroded the macroeconomic fundamentals and subsequently increased poverty in the economy. Consequently, Yemen Republic has implemented economic and structural reforms under the auspices of IMF and WB and the current a0nalysis is proposed to investigate how these reforms have been designed with consideration of the domestic circumstances of the economy. The study has also examined the extent to which the Yemen authorities own the reforms or their role in designing, formulating, implementing and the evaluation of these reforms. The study attempted to analyze the suitability of these structural reforms to the Yemen economy in view of enhancing the efficiency of the economy, generating full employment and in resolving the deficit that plagued the economy before reforms and in reducing poverty. In addition, the study has covered how these reforms have shaped the structure of the economy, their impact on the various variables of the macro economy and the population subsections. The degree of success and failure of reforms varied from one case to another, and from a specific situation to even a slightly different one. Those variations have reflected the efficiency in the implementation, adequacy of the surrounding economic, social and political environment, severity of economic difficulties, extent of structural distortions, IMF&WB coin prescriptions, and the conditions and prevailing situation of the world economy was also crucial factor in this matter.