Monster legislation.. Houthi strategy to engulf the Yemeni private sector
English - Saturday 17 June 2023 الساعة 03:50 pmThe Houthi group's efforts continue to flood the private sector in its areas of control, with strict economic measures, which has raised the concerns of merchants and businessmen, as some see that the measures issued by the group are a Houthi attempt to destroy and bankrupt their institutions.
During the recent period, Iran's arm approved economic measures, which included imposing price lists for various items of goods, closing a number of commercial companies, in addition to approving amendments to income tax, sales tax and customs laws, and preventing several commercial trucks from entering its areas of control.
The measures approved by the militias against the private sector coincide with the group's shift to replacing the private sector with merchants loyal to it, which observers suggest is an attempt to build a private economy for the group, in addition to striking their competitors in the market and taking over the buying and selling space.
New procedures
In this context, the "Saba" agency, which is controlled by the Houthi group, reported that the Council of Ministers affiliated with Iran's arm in Sana'a approved the projects submitted by the Deputy Prime Minister for Economic Affairs and Minister of Finance, Rashid Abu Lahoum.
According to the agency, the approval is to amend Law No. (19) of 2001 regarding the general sales tax and its amendments, as well as the amendment of Law No. (17) of 2010 regarding income taxes and its amendments, in addition to the amendment of Customs Law No. (14) of 1990 AD and its amendments.
The agency stated that the amendments aim to: “protect and encourage the local product through the use of appropriate fiscal, tax and customs policies, reduce the migration of local capital, and protect the local product from unfair competition, especially products subsidized from the country of origin, in a way that guarantees the continuity of the local industry, and raise quality, expanding internally, and exporting externally.
It also aims to: "Increase investments and direct them in areas of national priority, improve indicators of self-sufficiency, as well as facilitate and simplify customs procedures for investors, in addition to achieving indirect goals, including reducing unemployment, creating job opportunities for youth, improving the level of income of individuals, and reducing commodity value to the consumer. According to the agency itself.
On the other hand, the General Federation of Chambers of Commerce and Industry warned on May 26 of what it described as the Houthi abuse of private sector companies, noting that the group's practices "has become a sword wielded over them with the aim of ruining and bankrupting them.
Economic war
While the Houthi militia's efforts to swallow the market continue, observers considered the illegal amendments issued by the group as launching an economic war targeting the private sector, seeking to replace it with influential people loyal to the group itself.
In this context, economist Mustafa Nasr said: "These illegal measures are the inauguration of an economic war and a war against the real private sector, in an attempt to uproot it in favor of alternative merchants close to the Houthis' authority."
Nasr added, in the context of his speech to "NewsYemen": "The group began to control many economic sectors, such as communications, oil derivatives, and exchange companies, and now it turned to foodstuffs, and unfortunately it also turned to private sector organizations that represented a meeting point for all the private sector in Yemen. Therefore, these steps are very dangerous."
He believes that: "The procedures for demolishing the entire economic environment, and changing the structure of the economy, whether by abolishing the free market or the free market, and introducing a new mechanism that relies on the monopoly of the oligopolists close to power and influence, is a very dangerous matter."
He pointed out that: "Unfortunately, there are many legislations that support this approach, which the group started with, represented by the usurious interest law, in addition to the plans for income taxes, sales tax, customs, and others."
He believes that these laws and legislation, which the group recently introduced, will restructure the economic environment in line with the group's orientations. as he put it.
While it is believed that these measures come in light of the Houthis' tendency to restructure the economy, under the group's control, and to prepare the atmosphere for a private sector close to it, in addition to ending the real private sector that exists in favor of its forces of influence.
He believes that this transformation: "presents Yemen with great challenges in terms of compatibility with international legislation, and with regional and international trade relations."
He concluded by saying, "Unfortunately, the Houthi group does not pay any attention to all these facts, and proceeds with individual behavior that works to tear apart the Yemeni private sector, and works to isolate Yemen economically from the world."
During the years of the Houthis' control of state institutions, the private sector in the group's control areas was exposed to various forms of extortion, in addition to the widespread looting that caused most companies to stop working, which led to higher prices and an exacerbation of the economic crisis.