The Effect of Agriculture on Yemen’s Economy – Carnegie Endowment for International Peace.

In a debate on Yemen’s economy and the threats to Yemeni livelihoods, Sada features three articles that explore different aspects of the situation. The first article by Mohammed Ali Thamer examines a new law recently passed in Yemen, which is intended to prohibit usurious transactions. Thamer argues that the law, which bans all forms of usury in civil and commercial transactions, will compromise the Yemeni banking sector’s legal frameworks and deal a fatal blow to the economy if adequate accommodations are not made.

In the second article, Abdallah Ali focuses on the agricultural sector, which contributes to the income of 73.5 percent of the population in Yemen, either directly or indirectly. Ali highlights the risk that changes in weather patterns due to climate change, as well as the economic implications of the war and blockade, pose to farmers’ livelihoods. He argues for the importance of supporting this sector and paying attention to it at the peace table to contribute to broader economic development.

The third article by Ismail Al Aghbari delves deeper into the agricultural sector, explaining an initiative to reduce the planting of Qat and shift resources towards the cultivation of coffee. Qat is a crop that consumes significant water resources without providing any benefits to the food supply, whereas coffee is a smarter crop for the climate and can help to address water shortages. Some farmers in Yemen have already begun shifting their planting priorities, with an initiative launched to plant one million coffee plants by 2025.

The situation in Yemen is fragile, with years of conflict and rival administrations in Sanaa and Aden, combined with the effects of climate change, impacting Yemenis from across the geographic and socioeconomic spectrum. The situation is further complicated by the potential ramifications of the new usury law, which experts warn could lead to the closure of banks and the collapse of the entire banking system in Yemen. Additionally, agricultural workers face challenges posed by changes in weather patterns due to climate change and economic implications of the war and blockade. However, there are also efforts underway to address these challenges, such as the initiative to shift towards coffee cultivation.

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