Yemenis walk through a market in the old quarter of Sanaa, Yemen. EPA
Yemenis walk through a market in the old quarter of Sanaa, Yemen. EPA
Yemenis walk through a market in the old quarter of Sanaa, Yemen. EPA
Yemenis walk through a market in the old quarter of Sanaa, Yemen. EPA

Yemenis feeling isolated after 10-day internet blackout


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For ten days, much of Yemen has been isolated from the rest of the world after two major undersea cables were cut leaving the country with limited internet connectivity.

Global Cloud Xchange, the company that runs the internet services to the country, announced that the off-shore cables serving the Red Sea region were severed on January 9.

“Initial findings indicate that probable cause was an anchor drag by a large merchant vessel in the immediate area,” the company said, adding that they have begun repairs but the timeframe to restore connection depended on acquiring the needed permits. It said the cables affected were the main links between Muscat in Oman and Suez in Egypt.

Much of the world’s internet connections rely on undersea cables that route traffic from inside a country to the rest of the world. If these cables are cut, access to data held outside of the country is impacted. While in most places there are multiple cables, the loss of one or more can slow or stop traffic as remaining networks become overloaded.

A Yemeni vendor displays grilled maize for sale at a market in the old quarter of Sanaa. EPA
A Yemeni vendor displays grilled maize for sale at a market in the old quarter of Sanaa. EPA

The cuts near Yemen had an impact on the internet connection in Saudi Arabia, Kuwait, Sudan, Ethiopia and elsewhere.

The Public Telecommunication Corporation and Yemen International Telecommunications (TeleYemen), based in the Houthi-held capital of Sanaa, announced that more than 80 per cent of the country’s international internet capacities was out of service.

TeleYemen has been able to restore some connections by routing the internet through Oman’s Omantel to their undersea hook-up, but the main lines are yet to be fixed.

In the meantime, banks, exchange shops, internet cafes and printing centres remain closed. Many of the country’s 28 million people have been unable to get online.

Gihan Abdulhakeem, 31, works as a manager at the Aden’s community Lana Radio-FM broadcaster.

“It is really frustrating, she told The National from the station’s headquarters in Khourmaksar where there is a near-total blackout. “We didn’t expect that one day we will not be able to operate because of the internet.”

Despite the ongoing war, Ms Abdulhakeem says they were able to broadcast without intermission.

“We started broadcasting just after the city was liberated of the Houthi militia in 2015, we didn’t face such problem despite the huge damage to the city and now after five years we found ourselves not able to carry on broadcasting our programs to the community who used to follow us online... this is disappointing,” she said.

On a recent morning in the Crater area of Aden, the busiest district of the southern Yemeni city, Nadeem Omar, a 36 year old IT engineer and designer, was sitting desperately in the front of his closed shop. He usually fixes computers and designs leaflets, flyers, invitation cards and edit local advertising, but without the internet, he can’t work.

"It has been more than nine days we can't open due to the internet outage," he told The National.

“I have lots of accumulating work and my customers started to lose trust in me because they think that I should do something to solve the internet problem but how can I do that,” he asked.

“I come to the place every day struggling to do something to please my customers but I do nothing because the internet doesn’t work at all, it is really killing me, I have children to look after and the landlord asks me to pay the rent of the place,” Mr Omar complained.

Ali Mohammed, 39, is an MA student in the Faculty of Arts at Aden University. With a handful of papers, he roamed the internet cafés in Khourmaksar city looking for somewhere with a functioning connection to work on his thesis which he has to submit to the department in a week’s time.

“I have lots of work to be achieved within a very short time, the thesis is due next week while I have to finish everything in it shortly,” he said. “I have been roaming the internet cafes every day but no use, the majority are closed and the open ones are serving PlayStation games for kids only,” Mr Mohammed said.

“Time is running out while I have to finish the thesis up, I am afraid if the internet outage continues then I will not be able to submit the last draft in time and that means I will lose my appointment,” Mr Mohammed added.

What drives subscription retailing?

Once the domain of newspaper home deliveries, subscription model retailing has combined with e-commerce to permeate myriad products and services.

The concept has grown tremendously around the world and is forecast to thrive further, according to UnivDatos Market Insights’ report on recent and predicted trends in the sector.

The global subscription e-commerce market was valued at $13.2 billion (Dh48.5bn) in 2018. It is forecast to touch $478.2bn in 2025, and include the entertainment, fitness, food, cosmetics, baby care and fashion sectors.

The report says subscription-based services currently constitute “a small trend within e-commerce”. The US hosts almost 70 per cent of recurring plan firms, including leaders Dollar Shave Club, Hello Fresh and Netflix. Walmart and Sephora are among longer established retailers entering the space.

UnivDatos cites younger and affluent urbanites as prime subscription targets, with women currently the largest share of end-users.

That’s expected to remain unchanged until 2025, when women will represent a $246.6bn market share, owing to increasing numbers of start-ups targeting women.

Personal care and beauty occupy the largest chunk of the worldwide subscription e-commerce market, with changing lifestyles, work schedules, customisation and convenience among the chief future drivers.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Our legal columnist

Name: Yousef Al Bahar

Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994

Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers

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