DUBAI, Dec 23 (Reuters) - Yemen's cabinet on Sunday approved
a draft budget for 2013 that projects a deficit of 682 billion
rials ($3.17 billion) and expenditure of 2.77 trillion rials,
state news agency SABA reported.
The impoverished Arabian Peninsula state is still grappling
with the aftermath of last year's violent political turmoil that
led President Ali Abdullah Saleh to step down in February; the
government has sought billions of dollars of aid to overcome
financial and security challenges.
SABA said the draft budget, which now awaits approval in
parliament, projected revenue of 2.08 trillion rials.
Next year's forecast deficit is 21 percent higher than the
deficit originally projected by the government for 2012, while
expenditure is about 2 percent higher. In April, Yemen approved
a 2012 budget with a deficit of 562 billion rials and
expenditure of 2.70 trillion.
Restoring stability in Yemen, which is battling Islamist
militants with Washington's help, has become an international
priority because of fears that al Qaeda could become further
entrenched in a country which flanks top oil producer Saudi
Arabia and lies along major shipping lanes.
International donors including Saudi Arabia have pledged
around $8 billion in aid over the next couple of years to Yemen,
which was driven to the verge of bankruptcy and plunged into
factional anarchy by the year-long uprising against Saleh.
The economy of Yemen, where 40 percent of the population
lives on less than $2 a day, shrank 10.5 percent in 2011, the
International Monetary Fund estimated. In October, it forecast
the economy would shrink 1.9 percent this year.
The official inflation rate spiralled as high as 25 percent
year-on-year in October 2011; it subsided to 6.9 percent in July
this year, latest central bank data show.