RIYADH: Under the sponsorship of Saudi Arabia, the Arab Monetary Fund has signed a $1 billion agreement with the Yemeni government to revitalize its flagging economy.

The deal, signed in Riyadh, seeks to establish a comprehensive economic, financial and monetary reform program to improve governance and transparency, expand and diversify production and lower unemployment and poverty.

Saudi Minister of Finance Mohammed Al-Jadaan said that the program will develop Yemen’s financial and banking sector, strengthen the role of the private sector and promote long-term economic development.

The reform priorities for the government include developing public resources, controlling and rationalizing government spending, improving efficiency, and rehabilitating critical infrastructure in electricity, water and transport services.

Priorities for the financial and banking sectors include developing a supervision system to improve transparency and accountability and bolstering services for small and medium businesses and youths and women in rural areas. It will also seek to boost digitalization and payment method flexibility.

The program says the private sector is a primary driver of sustainable economic growth, and key in paving the way for greater integration into the global economy, the flow of foreign investment, and the strengthening of international partnerships.

The Yemeni government expressed interest in exploring opportunities for regional and international institutions to collaborate to support Yemeni economic reform.

The agreement’s sponsorship by Saudi Arabia is an extension of the country’s economic support for Yemen. The Kingdom gave the Central Bank of Yemen $1 billion in 2012 and $2 billion in 2018 to cover the import of basic food commodities.

From 2001 to 2022, Saudi Arabia has led the list of donor countries to Yemen, providing 30 percent of total support.