The IMF & Yemeni Energy Subsidy Reforms

The IMF & Yemeni Energy Subsidy Reforms

“Yemen observed violent protests in July 2005 as a response to subsidy reductions, which caused an increase in fuel and food prices. Currently, the political situation in Yemen is very sensitive and cannot withstand an economic shock that would further destabilize the country. In a recent visit to Yemen, Merza Hasan, a World Bank executive director, said it was not an appropriate time for Yemen to phase out subsidies, as it could derail the country’s political transition.”