The Road Ahead in Yemen

10.02.2013

yemen-ndc

On September 18th, the bumpy road toward democracy in Yemen was supposed to have arrived at a critical juncture. The day marked the end of Yemen’s National Dialogue Conference (NDC), a six-month long discussion among 565 delegates representing rival factions and marginalized groups.  However, the Foreign Minister Abubakr al-Qirbi recently announced that the national reconciliation talks could be delayed by “one, two or three months” due to unresolved political issues.

If the bloody carnage in Kenya’s Westgate mall points to the devastating consequences of state failure in neighboring Somalia, the possibility of a failed state in Yemen is all the more chilling. With the potential resurgence of Al-Qaida in the Arabian Peninsula, considered the most dangerous branch of the global terrorist network, Yemen’s future hinges on whether the delegates can reconcile the deep political divides and look beyond the years of mutual distrust.

However, there is also a growing disconnect between the political talks going on inside the luxurious Movenpick hotel and the socioeconomic realities on the ground. In the capital, Sana’a, the pothole-ridden streets serve as a daily reminder that Yemen’s transition still has a long way to go. In August, heavy rainfall swept through the parched capital and killed scores of people in various governorates. Despite an estimated $4.7 million set aside for improving the capital’s roads, the lack of proper drainage systems turned rainwater into flash floods that ripped open paved streets. As contractors dug up roads to install water pipes and telephone wires, the streets were left in worsened condition. Unfortunately, the digging does not stop there.

Some of the delegates attending the NDC are unearthing historical grievances and revisited Yemen’s tumultuous past. On August 14, representatives of the Southern Movement (al-Hirak al-Janoubi, also known as the Hirak) boycotted the NDC weeks before it was scheduled to finish in September. Since the 1994 civil war, some Southern leaders have voiced their call for secession from the Republic of Yemen. In the North, too, the Houthi rebels who fought a six-year conflict against President Ali Abdullah Saleh are now demanding regional autonomy. Although the current government issued a public apology on August 21 for its past skirmishes and persuaded the missing delegates to return, the issue of regional governance remained unresolved.

Too much politics has been dug up and not enough has been done to repair the deteriorating economy. As the NDC wraps up in October, the transitional government must put three urgent economic issues ahead of its ongoing political debate: issues like youth unemployment, resource scarcity, and capital flight. First, youth economic exclusion lies at the heart of the mass protests in 2011. While the millennial generation witnessed rampant corruption among the political elites, they were faced with grim job prospects and rising rural poverty. Furthermore, the poor quality of the public educational system has been neglected. The national curricula must be revamped to train young graduates to think critically, prepare for jobs in the private sector, or start sustainable businesses of their own. With youth unemployment rate climbing to 40 percent in Yemen, providing young graduates with economic opportunities must be the government’s utmost priority.

Second, estimates by the World Food Programme show that 46 percent of the country’s population does not have enough to eat. By 2025, Yemen’s capital Sana’a is expected to be the first city in the world to run dry while half of the population already  lacks access to safe drinking water. If the government does not deal with the food crisis now and manage its resources more effectively, then the humanitarian crisis will not only affect Yemen but also destabilize the entire region as refugees flood the surrounding countries. The international community has already promised much-needed assistance in the past two years, with donors pledging around $8 billion in financing and development assistance. Although only $1.8 billion has been delivered to date, international partners must continue to show their commitment to Yemen’s democratic transition and assist the government in its economic reconstruction.

Last, the transitional government can reverse the flight of capital leaving Yemen and attract foreign direct investment by improving the business environment.  To boost investor confidence, Yemen can streamline business regulations and offer greater access to finance for small- and medium-sized enterprises (SMEs), which account for more than 97 percent of the firms in Yemen. In 2011, capital flight totaled $712 million exiting Yemen’s economy. If the government can develop the country’s economic infrastructure, tackle subsidy reform, and decrease public sector employment, then it has the potential to harness domestic and foreign investment to boost long-term economic growth.

Taking steps to address these issues will improve ordinary Yemenis’ living standards and create opportunities for national unity. In the past, economic integration between rivals has led to political reconciliation. The European Economic Community, the predecessor of today’s European Union, was designed following the Second World War to prevent future conflicts by creating a common market among former adversaries. The United Arab Emirates as a federation of seven states also should serve as a model for political unity under economic cooperation. Since its inception in 1971, the UAE has moved beyond its internal political differences, focused on economic development, and attracted vast sums of foreign capital.

In 2011, Yemen’s deep political divisions reemerged following mass youth-led protests that threatened Saleh’s three-decade rule. The rival factions, once held together by Saleh’s extensive patronage system, braced themselves for the possibility of a full-blown civil war until the international community stepped in. By November 2011, a GCC-negotiated deal peacefully transferred power from Saleh to his deputy, Abd Rabu Mansour Hadi, and set up the framework for the NDC. Thus far, the majority of the participants have agreed on the principle of federalism, yet, as one delegate recently informed me, the plan for a two-state federal union along pre-unification boundaries “will certainly lead to war.” Other proposals, currently under review by a 16-member committee, include the possibility of a multiregional federal system integrating the North and the South.

While it is important to recognize the political past and address historical grievances, it is more constructive for policymakers to look forward into the future and tackle urgent economic issues. A friend of mine told me recently about an old Grecian saying: when you swim in a dark tunnel, there arrives a point when you cannot afford to turn back. The best option is to swim forward into the unknown and pray for an exit. It is time for all stakeholders in Yemen to make a leap of faith, because the country still needs roads, jobs, investments, food, and water. The 565 delegates of the National Dialogue Conference must hold their breath and move Yemen forward into the future. The road toward democracy in Yemen may be bumpy, but it is certainly one worth traveling on and there is no turning back.

Abdulwahab Alkebsi is Regional Director for the Middle East and Africa at CIPE.