Yemeni Trade Balance Deficit - Causes and Remedies

Abstract

The study aims to identify the trade balance as one of the important balances that all countries of the world seek to improve its composition through increasing exports, improving their quality, and limiting imports with a change in its composition in favor of exported industrial inputs. The trade balance also expresses the difference between exports and imports during a full year, as it indicates if the country has a surplus in its trade balance or a deficit in its foreign trade. From this point of view, this study deals with estimating and measuring the volume of foreign trade, especially since Yemen is located within a group of low-income developing countries, as it possesses non-independent economic resources. The most important results of this study indicate that the Yemeni trade balance fluctuated during the period (2000-2015) between a surplus and a deficit, as it was positive for the period (2000-2006), but it declined in subsequent years, turning the surplus into a deficit for several reasons, including: The quantitative decline in the volume of exports of oil and gas as raw commodities subject to their prices, this negatively affected the export component based on unprocessed raw materials whose prices are characterized by instability. Non-oil exports did not witness significant interest from government authorities, whether agricultural or industrial, which led to an imbalance in the trade balance, accompanied by the lack of a strategic national plan. For export And setting near and far goals to move the wheel of non-oil exports, and work to extract the latent wealth that our country abounds with.