Reem Al-Fadhli (South24)

Despite the several challenges facing Yemen, the e–commerce sector has witnessed remarkable growth in recent times, making it an attractive option for entrepreneurs and consumers. Many young people and business owners have taken to the internet as a low-cost way to launch their businesses amid the country’s continuing economic and security challenges. These businesses range from selling clothes, cosmetics, and home-cooked products. Many people, especially women, view online commerce as an opportunity to make good money in return for simple operational costs. Besides the traditional ways of communicating with customers, the e-commerce section has seen the emergence of specialized platforms and applications such as Bazzarry and Jeeey. This has enhanced the spread of e-commerce in Yemen. 

Big Expansion 

The spread of the internet in Yemen can be gauged from the fact that in January 2024, the number of internet users reached 6.16 million -- representing 17.7% of the population. The widespread prevalence of the internet has in turn also led to a rise in people seeking out online shopping avenues. Selling merchandise online is cheaper, and minus the headache of having to bear the high cost of purchasing or renting a shop, in addition to its related expenses. Shops can also be difficult to access for the customer due to the current conditions in Yemen. In light of this, many individuals and companies have switched to the e-commerce mode. In addition, the online payment system, though still limited, facilitates the sale and purchase operations via the internet. 

Take the example of Noha Sallam, from Taiz governorate, the owner of Rose Marine bakery that sells pastries and desserts. She has chosen the internet to promote her products. This is because she lacks the financial cushion to open or rent a shop. The internet has been an effective way for her to continue selling her confectionery. Noha told ’South24 Center‘ that she has not faced any hardships in delivering her goods or receiving payment as her work is limited to a certain number of reliable customers who are known for her. 

The Rose Marine project for selling pastries

Haneen Mohammed, from Aden, is the owner of the Antika Store that sells products such as shoes and bags. Haneen said that she chose the e-commerce mode to make her entry into the business world. She believes that this is the best choice for many young people in the early phase of their projects, and at a time when a lot of people are using the internet.

There are no official statistics for the number of e-commerce businesses in Yemen. This was confirmed by Undersecretary of the Ministry of Trade and Industry in Aden, Ali Al-Sharafi, who told ’South24 Center‘ that the sector is unregulated and depends on social media platforms to reach out to customers, and cash on delivery. He cited unofficial reports which indicate that demand increases during crises.

Successful Individual Projects 

The e-commerce projects have created a field full of job opportunities for young people, both women and men, including for shopping, delivery, and technical support. In addition, e-commerce has helped small businesses access wider markets and also led to the rise in tax revenues, according to Al-Sharafi. 

He said the ministry is seeking to facilitate giving licenses and reduce the fees for e-commerce, along with tax incentives and funding proposals. However, these are still under consideration due to the unfavorable economic conditions sweeping Yemen. 

Nonetheless, despite the adverse circumstances, women in Yemen in particular have marked their presence in the e-commerce sector, and proved their ability to run several commercial projects via the internet. Some have turned their e-commerce projects into highly successful ventures by building on their ideas. Haneen Mohammed, the owner of the Antika Store, said the idea of her project was derived from her passion for Asian products. Her travels to several countries such as Thailand, Malaysia, Indonesia, and China gave a further fillip to her idea, after she saw the smart and attractive way they had displayed their products. 

Haneen added: “This admiration pushed me to think about setting up my own online store that would provide customers with new products and with distinctive branding at a price that would suit their pockets, at a time when the market is witnessing limited choices.” 

The e-commerce Antika Store project

For her part, Noha Sallam said the idea for her confectionery business began as a hobby and she did not consider it as a profession. Over time, she turned it into a professional work. Noha added: “I first focused on preparing pastries and desserts. I offered certain types such as croissants, pizza, cones, and sandwiches, along with desserts and cakes. Later, the list of products expanded to include breakfast and lunch meals.”

For Haneen and Noha, social media platforms were the best way to launch their businesses, and over time they expanded their customer base remarkably. Haneen emphasized: “Over time, I received a lot of appreciation from customers for my products, and the continued demand and interaction with them has strengthened my desire to go on. The success of the e-store has pushed us to move to a traditional one to reach a wider segment of customers.”

Hardships and Challenges 

Success cannot be not attained without hardships and challenges. In an environment like in Yemen, the owners of e-commerce stores face several challenges, including the weak internet network and deteriorating economic conditions. The exchange rate disparity has limited dealings to one currency, the Saudi riyal, according to Iman Al-Qadimi, the owner of ‘EB’ store that specializes in selling products from global sites such as ’Shein‘ and ’Amazon’. She explained that the reason behind this is for purchasing and shipping commodities with this currency. However, this decision has led to the loss of a segment of customers who do not have Saudi riyals, and they think that the e-store only deals with the Saudi market.

The deterioration of the Yemeni currency is not the only challenge that Iman has to deal with. Other challenges include the delivery points, the sudden closure, or the customers’ unavailability to receive the goods on time. Another challenge is when the products do not match their promotional images, especially received from external sources. This requires Iman to display the real photos and provide accurate details such as the size and dimensions to ensure customers’ satisfaction. 

The e-commerce ’EB‘ Store

Noha believes that the fluctuation of the exchange rates has impacted her business in a big way. She explained: “When the prices increase, customers need some time to cope with the new price. This leads to decline in sales and sometimes they stop completely, causing losses to us.” 

According to her, when the exchange rates climb, she cannot afford to increase prices directly but has to wait for several days before making any decision. However, its negative impact remains even with the gradual price increase.

Haneen stressed that the challenges aren't limited to price change but also include taxes, imposed fees, and growing rental costs. This has affected the profit margin. Therefore, the return often does not exceed the capital, and in some cases barely covers the costs.

Haneen said: “The quality of our products and their competitive prices have made us stand out in the market. However, with the economic changes, especially the currency deterioration and instability, our work has been majorly impacted. Some customers understand the situation while others always criticize the price hikes although these changes are beyond our control.” 

Legal Vacuum

Some Arab countries, such as Egypt, Saudi Arabia, the UAE, and Jordan, have enacted laws addressing e-commerce amid the widespread use of the internet. On the other hand, Yemen currently depends on laws which regulate trade in general without any determined legislation for e-commerce. This situation has led to many consumers being exposed to fraud since the emergence of e-commerce in Yemen. Some scammers have exploited the lack of censorship in the e-commerce sector, making the internet a fertile ground to practice fraud. 

Mohammed Ibrahim, a shoe stall owner, tells his experience with a scammer. He told ’South24 Center‘ that a friend sent him a Facebook page post announcing the import of clothes and shoes from China at lower prices than what he used to pay. Ibrahim, quickly, without examining the matter, transferred a big amount of money to purchase the goods. 

He added: “I did not think that this offer was a fraud operation, especially since the page is followed by thousands of users. What encouraged me were the several comments which urged people to buy.” 

Despite the need for special legislation to control the e-market, lawyer Omar Al-Hamiri said that all transactions regarding electronic activities are organized according to carefully enacted commercial laws.

Al-Hamiri explained to ‘South24 Center‘ about protecting the customers’ rights. He pointed to the need to enhance consumer awareness through campaigns highlighting the common problems and the protection methods. This is in addition to learning how to document electronic contracts and distinguishing between authentic platforms and misleading offers, along with stressing the important role played by consumer protection associations. He added that platforms specialized in risk assessment can be developed, as well as for monitoring fraud and cheating operations, besides mechanisms for electronic mediation to resolve disputes quickly and efficiently.

Undersecretary Al-Sharafi said the failure to come out with a clear legal frame to regulate e-commerce in Yemen is a result of the years’-long conditions in the country. He emphasized that the ministry is currently working to apply traditional commercial laws to cover the electronic transactions on a temporary basis. 

He said efforts are being made draft new legislation, in cooperation with international organizations, in the matter. However, the progress has been slow due to the security and economic challenges in Yemen as well as the lack of resources.

Despite being hampered by legal, infrastructure, and internet challenges, e-commerce has proven its ability to establish itself as an important economic and business pathway in Yemen despite its limited spread. This form of trade has provided a window of hope to several young people, especially women. It has enhanced digital entrepreneurship in view of the complex economic reality and fragile infrastructure in Yemen. 

With the expansion of e-commerce, it has become necessary to institutionalize it through enacting clear legislations, for protection of consumer rights, and regulating the relationship between the parties involved to ensure the sustainability of this promising sector. In addition, investing in digital infrastructure and expanding the scope of electronic payment will contribute significantly to the development of the virtual business environment.