Macro - Country Economic Forecasts - Yemen, Rep

Macro - Country Economic Forecasts - Yemen, Rep

We have lowered our 2023 GDP growth forecast for Yemen by 0.9ppts to 1.8% as soaring inflation and acute food insecurity continue to devastate the country. In April, Iran and Saudi Arabia agreed to restore diplomatic ties, leading to talks between the Saudi ambassador and leading Houthi officials. This significant step towards a de-escalation of the civil war adds upside potential to the economic outlook next year. The talks could encourage Saudi forces to withdraw, and Yemen's Houthi-controlled ports could reopen. But we don't expect a total cessation of fighting for several years as many militant groups are still active in the country.