The Need for Disclosure with Yemen

Tuesday 05 October 2010
By Adel Al Toraifi

The “Friends of Yemen” meeting that took place on the sidelines of the UN annual conference has come to an end. The meeting which was held in New York came eight months after the London meeting, and over four years after the 2006 Donors Conference had pledged to offer over $3 billion to Yemen, of which only a small fraction has reached the country. The reason behind this is that some donors lack confidence in the capability of Yemen’s economic and development institutions to invest these funds appropriately.
The situation in Yemen today should be of a top priority for Saudi Arabia and the Gulf countries, not only because of the increasing Al Qaeda activity and the emergence of the Huthi movement as a (relative) threat to the security of the Gulf borders, but also because Yemen – whose population stands at 23 millions – is the poorest Arab country. Yemen ranks 166 out of 174 countries in the international GDP list, and it is estimated that around 43 percent of the Yemeni population live below the poverty line. There are more than 10 million Yemenis who live on less than two dollars a day, and the country’s unemployment rate has reached 40 percent. According to the most recent World Bank report on Yemen, the country’s oil revenues are limited and its water reserves will be depleted by the year 2017. Therefore, the crisis goes beyond the presence of 300 members of Al Qaeda or the Huthi movement’s control of some areas in the north; the situation is far more dangerous as the solidarity and the legitimacy of the state are at stake.
Whilst it is true that Yemen is not on the verge of collapse, as some of those who criticize the government are exaggerating, yet it has reached a sensitive stage of instability. Yemen was ranked 15th in the annual Failed State Index published by the Foreign Policy magazine in cooperation with the Fund for Peace. There are two points of concern regarding Yemen. Firstly, the central government, which has suffered since 2004 from Al Qaeda, Huthi, and southern secessionist threats, has become extremely fatigued by the successive wars. This has resulted in a misbalance of political power and has been costly to the state’s treasury. The second point is related to Yemen’s inability to address its economic crisis, to the point that social poverty is threatening the legitimacy of the governmental institutions, where resulting indignation strengthens the position of the government’s three opponents.
Given these challenges, the concerned states in the region and beyond are facing a considerable challenge, as many of the security threats to countries like Saudi Arabia and the US are coming from Yemen. The assassination attempt targeting Prince Mohammed Bin Naif last year, was made by “Al Qaeda in the Arabian Peninsula”, which is Al Qaeda’s most dangerous branch. The Nigerian Omar Farouk Abdul-Mutallab, who attempted to blow up a US airliner last year, was also trained in Yemen. This means that security in Yemen is so weak that it represents a threat to a number of significant countries in the war on terror.
The solution that is being proposed, especially in some American and European political circles, is that the speediest way to resolve the Yemeni crisis is by addressing the economic situation. In fact, some officials and experts are now openly calling upon Gulf States to accept more Yemeni workers in a bid to limit the socio-economic effects of the crisis. A report published by the Mackenzie Financial Corporation in collaboration with the Yemeni government last August revealed that to improve Yemen’s economy it needs to secure four million jobs in the Gulf over the next ten years. The number of Yemenis working in the Gulf today is only a little larger than the number working there in the 1980s. Even if the Gulf States agree to welcome this number of Yemeni workers, the foreign labor market in the Gulf, which already has 12 million workers, has no room for additional numbers.
Meanwhile, the Gulf States are finding it difficult dealing with the situation in Yemen, for they do not want to interfere in Yemen’s internal affairs, partly due to the long history of disputes that they have had with Yemen, a situation which has only calmed in the past decade. As for the Yemeni workforce, the prevailing view is that the Gulf States cannot absorb millions of Yemeni workers as they previously could during the period of industrial and constructional boom that began in the mid 1970s and lasted until the second Gulf War (1990 – 91). Moreover, the number of skilled workers in Yemen is small in comparison with the total available workforce. As for sending skilled workers to seek employment in the Gulf, the Gulf States believe that it would be wiser for them to stay in Yemen to help reactivate the Yemeni economy.
In the 1970s and 1980s, there were approximately 1.5 million Yemeni workers in the Gulf. At the time, Yemen was a non-permanent member of the UN Security Council when it decided to support Saddam Hussein’s regime following the Iraqi invasion of Kuwait. The then US Secretary of State James Baker warned Yemen against voting against the resolution authorizing the use of force against Iraq, saying that “Yemen would pay a heavy price.” This came to pass, and within just a few months, more than 800,000 Yemeni workers were asked to return home. This incident greatly affected the Yemeni economy, especially after international aid to Yemen was reduced to $200,000, and the unemployed in Yemen became a huge burden to the Yemeni government. In addition, the 1994 Yemeni civil war created a new social and economic reality, whose features remain clear a decade later, and numerous domestic or international initiatives have been unsuccessful in rectifying the situation.
In an important study entitled “Yemen: The Collapsed Economy” published in Asharq Al-Awsat periodical (summer 2010), Nora Ann Colton said that “Yemen’s problem, like any other country suffering economic transformation and depleting resources, is that the invisible hand of the market cannot work alone.” The invisible hand of the market is a concept that was first used by economist Adam Smith (1759) and by many economists after him to describe the market’s self-regulating nature based upon the laws of supply and demand. Colton wanted to say that at this stage the Yemeni economy is unable to function appropriately due to structural reasons. In other words the economic solution alone may not be sufficient to solve Yemen’s current problems, but rather a new social contract is required to enable it to overcome its crisis. It is true that separation between the North and the South or even between Saada (Huthi stronghold) and Sana’a may not resolve the crisis, as some secessionists claim. This is because secession will not succeed unless these new entities are able to stand on their own as independent states, which is impossible. Let us recall that the south would not have been able to establish itself as an independent state without British support during the occupation period, and then the Soviet support during the Cold War.
Currently, Yemen does not seem capable of overcoming this crisis alone, but needs the help of others, and more importantly needs their advice and frank disclosure. If Yemeni officials continue to deal with the southern movement and the Huthis as though are Al Qaeda, this much needed peaceful solution will not occur. On the other hand, the regional countries that have tried to turn a blind eye to what is happening in Yemen are no longer safe from harm.

About altoraifi
Al Toraifi is the current Editor-in-Chief of Al Majalla, the leading Arab magazine. A specialist on Saudi foreign policy, he is recognized as a commentator and participant in televised programs for CNN, NBC, BBC and Al-Arabia TV. Awarded the post-graduate International Conflict Prize 2008 from Kingston University for outstanding work, Mr Al-Toraifi is currently a PhD candidate at the London School of Economics and Political Science.

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