Government-by-Government Assessments: Yemen

During the review period, the government did not produce any budget documents within a reasonable period, including an executive budget proposal, end-of-year report, or enacted budget.  The government published limited information on debt obligations.  It did not publish major state-owned enterprise debt, in part because most state-owned enterprises are based in Sana’a, which is outside the areas currently under Republic of Yemen government control.  Actual revenues and expenditures likely differed from the budget extensions.  Budget extensions did not meet internationally accepted principles.  The government did not break down expenditures to support the president and his council.  The government likely maintained significant off-budget accounts.  Military and intelligence budgets were not subject to parliamentary or civilian public oversight.  It is unclear if the supreme audit institution met international standards of independence because it is not active.  It did not conduct an audit of the government’s executed budget.  The government did not fully exercise legal authority over natural resource extraction and did not fully specify in law or regulation the criteria and procedures for awarding natural resource extraction contracts and licenses.

Yemen’s fiscal transparency would be improved by:

• Passing a budget and making budget documents available to the public within a reasonable period;
• Publishing substantially complete information on debt obligations, including for state-owned enterprises;
• Ensuring budget documents are substantially complete and reliable;
• Breaking down expenditures to support executive offices in the budget;
• Ensuring actual revenues and expenditures reasonably correspond to budget projections;
• Preparing budget documents according to internationally accepted principles;
• Eliminating off-budget accounts or subjecting them to adequate audit and oversight;
• Subjecting military and intelligence budgets to parliamentary or civilian public oversight;
• Activating a functioning supreme audit institution that meets international standards of independence;
• Producing and publishing audit reports of the government’s executed budget within a reasonable period;
• Exercising legal authority over natural resource extraction; and
• Clarifying laws and regulations for awarding contracts and licenses for natural resource extraction