Yemen is a centrally located, pinched into the Gulf of Aden but wide open to maritime trade. This gulf is one of the busiest bodies of water for the global energy trade. Its importance cannot be overstated.
Yemen has extensive, historic ties with its neighbors, Saudi Arabia and Oman. Yemen has shaped regions and cultures far and wide. Throughout its history, Yemen, like Oman, has been an important contributor to Indian Ocean trade networks.
As oil reserves diminish, Yemen may look to alternative energy sources. Renewable energy, especially solar, is likely to play an important role in the future.
The Gulf region is rich in hydrocarbons, oil, and gas. This could help Yemen manage the transition from one energy source to another.
1. YEMEN: SOLAR POWER AND OCEAN ENERGY
The edges of a body of water, where ships glide smoothly over the surface of the sea, are what makes Yemen unique. The crystal clear blue waters and vast coastlines promise determination in spirit. Coasts have seen the comings and goings of many trade-oriented naval powers. They have traversed this space, the Indian Ocean. It is the interplay of water and land, of ocean and desert, punctuated in many places by scrub forests, which are found especially in the northwest of Yemen. This is what makes Yemen so unique.
The forces pushing the continued expansion of renewable energy generation in Yemen are wind and solar. Wind energy is linked to the sea, the Indian Ocean. More so, the interplay of these two forces makes Yemen a suitable area for the further growth of energy-efficient sailing and maritime transport. With its good access to the outside world, its connection to the Gulf of Aden and the Indian Ocean, Yemen is ideally suited for low-cost and energy-efficient trade.
Yemen has easy access to the world’s waterways and still benefits from the country’s oil resources. With declinng oil reserves, renewables are the key to success. The only question is how to get there. Yemen may need to develop its renewable and solar energy potential. Yemen can excel in solar energy. In fact, Yemen has some of the best conditions for solar energy you could ask for, with great potential throughout the country. The rugged terrain may prove to be an obstacle, making it more costly to provide the infrastructure for solar power generation and distribution.
The central task remains, namely to provide decentralized energy solutions for the country. Such solutions befit various inland regions that are not closely linked to the coast. Both wind and solar energy offer great potential that needs to be exploited. This becomes ever more important, as hydrocarbon resources gradually run out.
2. WHY YEMEN CAN BECOME AN ENERGY TRADING HUB
What could be an incentive for investors to expand their presence in Yemen? There may be many reasons. The most important reason may be the fact that Yemen is located between the Arabian Peninsula, yet in close proximity to East Africa. The Indian Ocean in general is a region of rapid growth. Yemen can provide access to trade networks in this vast space.
Yemen needs to balance trade with other aspects of trade policy. This trade involves the core regions of the Arabian Peninsula and the rest of the world, where part of its future lies. The Indian Ocean and Indo-Pacific regions play a key role in this regard. The core region includes states such as Saudi Arabia, Jordan and Iraq.
The unifying element is the sea. Just like Oman, Yemen holds on to its maritime roots. For much of its history, Yemen has traded with countries across the Indian Ocean. As mentioned at the outset, Yemen is at the intersection of two elements: Water and Land, Ocean and Desert. The key to Yemen’s future may lie in the combination of these two elements. The further inland you go, the more desolate the land becomes. In many places, the rugged landscape makes the country almost inaccessible until you reach Saudi Arabia further inland. This makes solar energy deployment challenging. Energy cooperation with Saudi Arabia could facilitate growth across the region.
3. YEMEN: MARITIME ENERGY TRADE WILL PLAY A MAJOR ROLE
Yemen is a crucial link between Europe, the Middle East and Africa. It can become an energy hub, a central player where the world’s trade networks meet and interact. Yemen has the advantage of being able to put the pieces of the puzzle together. What do we mean by that?
Yemen is located at the tip of the Indian Ocean, in the northwestern corner of the sea chart. Yemeni energy companies have an advantage in international energy trade. Yemen can take advantage of the central role it plays. Yemen can do this by linking the region’s supply chains. These linkages allow for economies of scale.
Yemen’s many connections are important. They provide access to networks around the world. This may explain why regional and global powers are active in the region, to gain access to these networks and trade relationships. The interest of regional and global powers in the region may also lead to an expansion of relations with Yemen. Energy trade obviously plays an important role.
This is also reflected in neighboring Djibouti, which has become an important port location, providing a safe haven for a great many armed forces on the Gulf of Aden. Yemen could play a similar role in the future. This may benefit its economic growth. Again, Yemen’s own energy resources, the energy resources surrounding it, and the energy resources it can draw on as a potential transshipment point for oil and gas from the Middle East, South Asia, and East Africa are key to this strategy.
- Yemen is a key player in the Middle East for geostrategic and energy reasons. Yemen has considerable room for maneuver in all possible directions. Its growth is not hampered by a lack of market access, and its energy shortage can be overcome either through trade or through domestic renewable energy production.
- As mentioned earlier, there are still a great many hydrocarbon resources worth exploiting in Yemen.
- Unlike the Persian Gulf littoral states, Yemen can develop in any direction. Yemen can trade with a variety of international partners. Networks are key; international trade is at the heart of an extensive international trade network and emerging energy markets that reach as far as the Indonesian archipelago.