The geoeconomics of reconstruction in Yemen

November 21, 2018

The ongoing conflict in Yemen has exacted a disastrous toll on the country’s people, economy, infrastructure, and institutions, as well as the ties that bind them. The effort to rebuild both the tangible and intangible aspects of Yemeni society will be complicated by not only the fragmentation among Yemen’s political and military factions, but also by the multitude of foreign actors and interests that, directly and indirectly, have come to exert an influence over the conflict, or could do so in the future.

This paper seeks to elucidate who these outside forces are, what the nature is of their involvement, and what their converging and conflicting interests mean for Yemen’s future reconstruction effort. For example, it is clear that direct intervention by the two main foreign actors, Saudi Arabia and the United Arab Emirates, has made these regional states deeply committed to the outcome in Yemen. Yet that very investment may incline each state to try and shape the postconflict environment in a manner that privileges the interests of allies, to the detriment of others perceived as adversaries. This substantially complicates the reconstruction process by potentially hindering the equal distribution of reconstruction resources. Moreover, Saudi Arabia and the UAE’s regional adversary, Iran, could advance its own strategic goals by prolonging the conflict through the continued provision of, or significant upgrades to, material support to the Houthi rebels.

Recommendations

  • A coordinated and unified GCC response to postconflict reconstruction in Yemen will be essential to meeting the country’s political and economic requirements.
  • Yemen’s long-term economic viability will be greatly enhanced if the GCC extends some of its membership privileges, such as tariff relief for exports from Yemen and labor concessions.
  • Yemen’s political culture of patronage, especially from foreign influence, is likely to persist. To reduce the tendency to play one foreign patron against another, patron-client relationships between foreign states and local governorates and armed groups must be centralized into state agencies or federal units, to bring legitimacy to government, not warlords, militias, or sectarian actors.
  • One effective mechanism to restore legitimacy to local governments and limit discrepancies in regional access to relief, including the disbursement of salaries, is an effort to increase transparency in the amount and distribution of aid funds by region and local governments at the municipal level.
  • A central tenet of any reconstruction program should be setting realistic goals. While the temptation may be to aim for major infrastructure projects like ports, airports, and free zones, small-scale projects like sanitation rehabilitation, localized solar power grids, infrastructure or public building repair, and small roads projects of the kind the World Bank is engaged in are far more likely to provide tangible benefits.
  • Local needs assessments should be conducted in conjunction with local communities to ensure maximum possible buy-in.

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