Port Cities Development Program

BACKGROUND

The Government of Yemen (GOY) is fully committed to strengthening Aden’s role, and to developing its potential, as an engine for economic growth. This is reflected through the designation (in May 1991) of Aden as the country's economic and commercial capital, and the Government’s resolve to removing constraints to investment and promoting private sector activity in the city.

The Republic of Yemen received a Credit from the International Development Association (IDA), a member of the World Bank Group, to finance the activities of the Port Cities Development Program. The Program’s main objective is to create an environment conducive to private sector-led growth in selected strategic port cities employment opportunities in participating port cities. Phase I of the Program would seek to: (i) strengthen local government strategic, financial and physical planning and coordination capabilities to better utilize existing assets and resources; (ii) improve the efficiency of, and streamline administrative procedures at key local government agencies that interface with the private sector; and (iii) revitalize port city business districts/ clusters through physical investments that are key for growth and employment generation.

Specifically, Phase I components include:

Revitalizing Port City Economy and Business Clusters. This would include physical investments for: (a) access improvements to vital transport infrastructure, and (b) support the rehabilitation of commercial areas and emerging business clusters.

Strategic and Physical Planning. This component would support formulation of City Development Strategies, including competitiveness assessments, cluster strategies, and participatory workshops. Proceeds would also be used to update Master Plans, and develop Capital Investment Plans that prioritize investments. Design and feasibility studies for Phase I investments in Aden, as well as for Phase II investments in Aden, Hodeidah and Mukalla, will also be financed under this component.

Local Capacity Building and Administrative Modernization. This would include a series of capacity building measures to improve the efficiency and transparency of services provided by local Aden public agencies to the private sector.

Port Cities Development Program (PCDP)

(Aden, Hodeidah and Mukalla)

PCDP Objectives:

The PCDP goal is to transform Yemen’s strategic port cities (Aden, Hodeidah and Mukalla) into regional centers of economic growth by creating environments conducive to private sector development.

Why Port Cities?

Yemen’s coastal areas are considered to have the highest potential given their abundance of natural resources as compared to other areas. Also, given the depth of their commercial experience, the port cities gained the focus of strategic importance of Yemen’s economic plans in the government’s attempts to broaden investment and to decrease reliance on oil in order to promote more balanced development.

PCDP Description
Three cities... Three phases

Phase I:

• Strengthening strategic, financial and physical planning processes.

• Reforms to encourage and stimulate economic activity.

• "Uncontested" investments to improve access and the reliability of select infrastructure facilities and services.

• Completion of CDS in Aden and identifying prioritized investments for Phase II.

• Launch CDS in other port cities.

Phase II:

• Formal adoption of CDS and capital investment plan.

• Successful completion of CDSs in other two cities.

• Implementation of key local reforms.

• Establish inter-governmental dialogue with port cities to adopt national level reforms necessary to promote private sector investment.

Phase III:

• Implement local investments and reforms planned in Phase II.

• Assist central government implement the reforms.

• Invest in facilities of national significance, consistent with the CDS.

• Rationalize and streamline institutional arrangements designed to promote private sector development and growth at the local level.

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