Sana’a, Yemen, May 13, 2010—IFC, a member of the World Bank Group, signed an agreement with Yemen’s government and its private investment arm, Shibam Holding,  to strengthen Yemen’s tourism sector by helping improve tourism regulations and supporting increased investment that will create jobs and expand the country’s economy.

IFC will help Yemen’s Ministry of Tourism develop tourism regulations to attract investments, clarify the different roles and responsibilities of government regulatory agencies, and ensure that international social and environmental sustainability guidelines are met.

IFC will also work with the newly-established Yemen Tourism Development Company (YTDC) on attracting sector investment while investing in pilot projects. YTDC was created in partnership between the Yemen Tourism Promotion Board and Shibam Holding.

Shaun Mann, IFC’s Senior Investment Policy Officer for Tourism, said, “Yemen’s tourism sector has outstanding potential. The country has an unexplored, pristine coastline and mountains as well as a unique architectural heritage. An improved policy framework will help attract investment, create jobs, and improve the country’s economy.”

Saad Sabrah, Chairman and CEO of Shibam Holding, said, “This initiative aims to consolidate under one corporate umbrella all government-owned assets which are geared towards serving the tourism sector, and to ensure that these assets are developed and marketed to strategic investors who will work with YTDC and help in implementing the country’s national tourism strategy.”

Drawing on  experience from supporting tourism in countries including Sierra Leone and Mozambique, IFC will help Yemen attract investment into desirable destinations, such as the Red Sea Islands or Socotra, that will build local supply chains, and create direct and indirect jobs.

Tourism is becoming increasingly important for Yemen’s economic growth as its revenue from oil declines. Tourism currently generates only about $50 million of new investments, and about 3,000 new jobs annually. Most investments in Yemen’s tourism sector are in small projects, with large-scale investments hampered by unclear regulation, insufficient assessments, and little knowledge about investment opportunities.

IFC’s work in the tourism sector will be financed through a three-year program supported by the United Kingdom’s Department for International Development (DFID) and implemented by the Investment Climate Services of the World Bank Group, in collaboration with Yemen’s government and the private sector

About IFC
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $14.5 billion in fiscal 2009, helping channel capital into developing countries during the financial crisis. For more information, visit www.ifc.org.