YEMEN HARMONIZES UNEMPLOYMENT RATE WITH

UNCLAS SANAA 000981 SIPDIS NEA/ARP FOR ANDREW MACDONALD USAID FOR CHRISTOPHER KISCO E.O. 12958: N/A TAGS: ECON EAID PGOV YM SUBJECT: YEMEN HARMONIZES UNEMPLOYMENT RATE WITH INTERNATIONAL FIGURES ¶1. SUMMARY. In a departure from the past, the ROYG has announced that the unemployment rate reached 35 percent in 2008, which is in line with statistics from international organizations. The ROYG's report could symbolize a harmonization of government figures with internationally-recognized statistics. ROYG acknowledgement of and agreement with internationally recognized unemployment rates could represent a step towards greater transparency in official statistics as well as more realistic policy assessment and implementation. END SUMMARY. ¶2. In early May, the Ministry of Planning and International Cooperation (MOPIC) released its annual Economic Report, announcing that Yemen's unemployment rate reached 35 percent in 2008 as compared with 16.7 percent in 2007. Prior to 2007, ROYG reports have indicated that unemployment did not exceed 11 percent. These figures contrasted starkly with figures from international organizations such as the World Bank, which have identified unemployment as high as 40 percent. ¶3. The Economic Report may indicate a harmonization of ROYG figures with internationally-recognized statistics. Hisham Sharaf Abdalla, Deputy Minister for International Cooperation at MOPIC, told EconOff on May 19 that this year MOPIC used a different method for calculating unemployment, which takes into consideration temporary unemployment of mobile workers as well as permanent unemployment of stationary Yemenis. Ali Alabdulrazzaq, Senior Economist at the World Bank, suggested to EconOff on May 18 that the unemployment rate depends on the method used to calculate it, which could be as low as 16 percent, using one method. Nabil Shaiban, Director General for International Cooperation at MOPIC, told EconOff on May 19 that the figures have been updated for 2008 and that "low participation in the labor force"*another measure for unemployment*has reached 39 percent. COMMENT -------------- ¶4. Official figures, which in the past have varied greatly across governmental ministries, have been long held suspect by international observers and cited as the basis for short-sighted policy decisions. ROYG acknowledgement of and agreement with internationally recognized unemployment rates may represent a step towards greater transparency in official statistics, and an opportunity to develop a strategy based on concrete figures to counter unemployment. END COMMENT. SECHE