Sanaa, Amanat Al-Asemah, Yemen

🇾🇪 Sanaa, also spelled Sanaʽa or Sana, is the largest city in Yemen and the centre of Sanaa Governorate. The city is not part of the Governorate, but forms the separate administrative district of "Amanat Al-Asemah". Under the Yemeni constitution, Sanaʽa is the capital of the country, although the seat of the Yemeni government moved to Aden, the former capital of South Yemen in the aftermath of the Houthi occupation. Aden was declared as the temporary capital by President Abdrabbuh Mansur Hadi in March 2015.

At an elevation of 2,300 metres (7,500 ft), Sanaa is one of the highest capital cities in the world and is next to the Sarawat Mountains of Jabal An-Nabi Shu'ayb and Jabal Tiyal, considered to be the highest mountains in the country and amongst the highest in the region. Sanaa has a population of approximately 3,937,500 (2012), making it Yemen's largest city. As of 2020, the greater Sanaa urban area makes up about 10% of Yemen's total population.

The Old City of Sanaa, a UNESCO World Heritage Site, has a distinctive architectural character, most notably expressed in its multi-storey buildings decorated with geometric patterns. In the conflict that raged in 2015, bombs hit UNESCO sites in the old city. The Al Saleh Mosque, the largest in Sana'a, is located in the Old City.

Sanaa faces a severe water crisis, with water being drawn from its aquifer three times faster than it is replenished. The city is predicted to run completely out of water by around 2030, making it the first national capital in the world to do so. Access to drinking water is very limited in Sanaa, and there are problems with water quality.

Economy Historically, Sanaʽa had a mining industry. The hills around Sanaʽa were mined for onyx, chalcedony, and cornelian. The city was also known for its metalwork, which the British described as "famous" in the early 20th century, but declining in popularity. As of 1920, Sanaʽa was described by the British as being "well supplied with fruit and grapes, and has good water".

As the capital city of Yemen, nearly 40% of jobs in Sanaʽa are in the public sector. The city is also an important centre for commerce and industry in Yemen. Additionally, like many other cities in the developing world, Sanaʽa has a large informal sector that is estimated to constitute 32% of nongovernmental employment as of 2002.

By far the largest area of the economy, both in terms of number of businesses and in jobs, is in commerce and small services. As of 2004, 58.9% of all establishments and 31.3% of all jobs in Sanaa belong to this category. Another major category is general administration, which only makes up 0.8% of employers but has 18.0% of workers, making it the second largest in that regard. Manufacturing is the third-largest category by both measures, with about 12% for both. Sanaa also has a higher concentration of hotels and restaurants than elsewhere in the country.

About 62% of jobs in Sanaa are working for private, locally owned enterprises, followed by state-owned enterprises which employ 31%. Waqfs, private foreign-owned companies, and private joint ventures make up the rest in that order, with none employing more than 2%. Sanaa's economy is large compared to its population: as of 2004, it was home to only 9% of Yemen's population but 16% of the country's businesses and 22% of its formal-sector jobs. The average size of a business establishment in Sanaa is small, at 3.88 employees on average; however, this is higher than the national average of 2.87 and only Aden has a higher average at 6.88 employees. Between 1992 and 2006, 39% of all new formal-sector jobs in Yemen were created in Sanaa, along with 33% of new business establishments. In terms of jobs created, Sanaa is ahead of all other governorates in Yemen by a factor of three.

Poverty and income inequality While Sanaa has a vibrant, diverse economy with more jobs being created than anywhere else in Yemen, it also has the highest concentration of poverty in the country. It is home to 6.5% of the country's total poor population and 23% of the poor urban population. About 15% of the city's population lives below the national poverty line as of 2007. There are also many people living just above the poverty line that are still in a relatively precarious financial position. High unemployment is another problem; by some estimates, as much as 25% of Sanaa's potential workforce is unemployed.

Income inequality is also increasing: from 1998 to 2005, the Gini coefficient for Sanaa increased from 37% to 44%: a 21% increase, the highest in the country. High inflation, low per capita income growth, and disproportionate gains by the rich have contributed to a middle class squeeze in Sanaa's middle class since the 1980s.

Challenges facing local businesses A 2005 survey of 488 Yemeni firms by the Mitsubishi Research Institute included a subset of 175 firms in Sanaa. They reported similar challenges in doing business to firms throughout the country. In particular, corruption is a problem in their dealings with the government, and hefty bribes are often a necessity. Certain businesses are able to use their connections to dodge taxes and regulations, which puts other businesses at a disadvantage because they have to abide by the rules. Long delays for customs clearances, especially for imports, are ubiquitous, and over 70% of the surveyed firms reported that they had made extra-legal payments to customs officials. Financial constraints also confront many entrepreneurs in Sanaa: the cost of bank credit is also prohibitively high, and loan guarantees often come with heavy demands that are difficult to meet. Shortcomings in municipal infrastructure are another problem: for example, because access to electricity is unreliable, many firms have to install their own backup generators.

Energy Before the civil war, Yemen's electricity was primarily supplied by the Ma'rib gas-fired power plant, which came online in 2009 and supplied 27 to 40 percent of the country's electricity while active. (Before that, power came from six diesel power plants in Sanaa itself.) The Ma'rib plant is connected to the Bani Hushaysh substation by a power line with a capacity of 400 kV, and the Bani Hushaysh substation is then connected to substations in Dhahban and Hizyaz by two 132-kV lines. However, the Ma'rib-Sanaa power line was frequently targeted by attacks; there were 54 attacks on the power line between 2010 and 2013. The Ma'rib plant ceased operations in 2015.

The Dhahban and Hizyaz substations also have generating capacity in addition to being supplied by the Ma'rib plant. The Dhahban station is the main one in Sanaa; located 10 km north-west of the city, it had an original generating capacity of 20 MW, with another 30 MW installed during the 2000s, bringing the total to 50 MW. The Hizyaz station consists of three power plants: the first, with a capacity of 30 MW, was completed in 2002. Another 60 MW plant was added in 2004, and then in 2007 the third plant, with a capacity of 30 MW, was also completed.

While most of prewar Sanaa was connected to the electrical grid, including at least partial coverage in most of the city's 35 informal settlements, access to electricity was unreliable. Power outages were common, and one 2011 report suggested that electricity was only available for one hour per day.

The civil war has severely impacted the energy sector in Yemen, due to several factors including damage from attacks, lack of funding for maintenance, and fuel shortages. As of 2018, 43% of Sanaa's energy assets were completely destroyed, while another 38% had suffered partial damage; in addition, 81% of the facilities were not functioning. As a result, the public power supply in Sanaa has become almost nonexistent: of the daily 500 MW electricity demand in the city, the city receives 40 MW. The public electricity supply is now mostly or entirely supplied by the Hizyaz station, whose capacity has been reduced to 7 MW. Public grid access covers around 2% of the population, mostly in nearby neighborhoods, and it is expensive for consumers. Private services using their own generators also sell electricity to customers; they cover another 2.8% and cost about as much as the public supply. The largest share of electrical supply in Sanaa came from privately-owned solar panels and diesel generators, which together covered 30% of the population. Solar power rapidly gained popularity in Yemen in 2015, and in 2016 it became the leading source of electricity in the country.

Prices of fuel and diesel in Yemen have risen dramatically since the start of the war; current prices are 150% of what they were in 2017. The most recent crisis in Sanaa came in September 2019, leading to days-long lines at gas stations. Black market prices can be three times higher than the official ones, leaving many unable to afford fuel.