Yemen's Challenges and Prospects for Reconstruction

July 23, 2018 • 12:30 – 2:00 pm EDT

Donors must not wait for a political settlement to begin addressing Yemen's reconstruction, Ala Qasem of DeepRoot Consulting argued at a recent CSIS Middle East Program roundtable.

Efforts to rebuild Yemen will have to address humanitarian issues, reconstruction, and economic reform simultaneously rather than sequentially, and efforts need to begin now, Ala Qasem argued at a recent CSIS Middle East Program roundtable. Qasem also highlighted new opportunities for Gulf Cooperation Council (GCC) involvement in Yemen's reconstruction. Qasem, co-founder of the strategic and political consulting firm, DeepRoot Consulting, spoke at a CSIS roundtable on “Yemen’s Challenges and Prospects for Reconstruction” on July 23, 2018.


Reconstruction Challenges

Gulf Cooperation Council (GCC) countries have pledged billions of dollars in aid to Yemen and are expected to contribute the majority of funds for its reconstruction. However, Qasem said there is reason to doubt how effective the $7.7 billion fund pledged for the next two years will be in helping the country meet its reconstruction objectives. Compared to assistance for post-conflict reconstruction efforts elsewhere, such as in Afghanistan, this is a relatively small aid package and covers only a short period of time. In addition, Yemen’s government faces several challenges to project development and completion, and aid disbursement rates have been low as a result.
 
Local factions and armed groups are often more powerful than the central government, yet these actors have not been presented with sufficient incentives to buy in to the development process.
First, government institutions are weak and lack the capacity to execute development projects efficiently. Qasem noted that commitment to infrastructure project completion is low, project managers often lack the necessary expertise, and steering committees fail to convene regularly, resulting in a critical lack of transparency in project planning and development. Local factions and armed groups are often more powerful than the central government, yet these actors have not been presented with sufficient incentives to buy in to the development process.

Second, the weak security environment hampers the progress of development projects. With an array of armed factions controlling different parts of the country, complex negotiations, stringent security requirements, and significant detours are required to complete a task as basic as transporting goods across the country. Qasem cited the example of a gas-fueled energy project in Ma’rib which was significantly delayed because it took more than a year for turbine components to be transported from the Houthi-controlled port of Hodeidah to the project site, a distance of less than 250 miles. Similar security challenges obstruct aid delivery, contributing to Yemenis’ accusations that aid has become politicized and that their government is strategically withholding resources from unsympathetic factions.


A New Approach

Qasem argued that donors must not wait for a political settlement to begin addressing Yemen’s reconstruction. He urged GCC countries and other international donors to think beyond the traditional sequential framework for reconstruction, which tackles humanitarian relief first, then reconstruction, and finally economic reforms. Instead, he proposed a new approach, highlighting three interrelated areas on which reconstruction efforts should focus concurrently: reestablishing government legitimacy, strengthening the security environment, and building state effectiveness.
 
Elections necessarily produce winners and losers, and could therefore serve as a spark for renewed conflict if losing factions reject the results.
Although elections are often seen as a litmus test for government legitimacy, Qasem warned against holding them too soon. Elections necessarily produce winners and losers, and could therefore serve as a spark for renewed conflict if losing factions reject the results. The government must first work to rebuild the trust deficit with its citizens by improving accountability and transparency. Qasem suggested that delivering aid in the government’s name would be one way of enhancing its legitimacy. He also said that Yemeni citizens should be engaged in constitutional reform in a meaningful way. Yemen’s government must also improve its capacity to deliver essential services effectively, while also proving its ability to follow through on macroeconomic policy objectives. However, Qasem noted that Yemenis’ expectations of what services the government should provide have lowered significantly, and he presented this as an opportunity. He argued that the private sector is especially well-placed to collaborate with the government in this regard and share the burden of service delivery.

Qasem contended that in addition to traditional methods of disarmament, demobilization, and reintegration, improving Yemen’s economic situation would also assist in strengthening the security environment. Increasing economic productivity would help minimize security threats because local business owners would have greater incentives to work to prevent violence from breaking out which could jeopardize their business interests. New businesses could also be created specifically to absorb former fighters into the labor market.


Reframing GCC Involvement

Qasem also supported finding ways to integrate Yemen into GCC economies. Economic ties between Yemen and the GCC are challenged by declining oil revenues, and Saudization policies and automation have cut into remittances. Meanwhile, many Yemenis with potential investment capital who reside in the GCC have been discouraged from investing by Yemeni government restrictions and fears of corruption. Qasem argued that the GCC should explore new collaborative economic initiatives to support the Yemeni state and its stability in order to reverse this trend. He proposed the establishment of economic zones on Yemen’s borders with GCC states with special tax arrangements to help stimulate economic growth in Yemen. GCC states could also capitalize on the potential of Yemen’s mining and fishing industries.
 
Some Yemenis are critical of the politicization of aid from regional donors, perceiving GCC states to be pursuing their own agendas and failing to deliver on some of their pledges for political purposes.
Qasem noted that some Yemenis are critical of the politicization of aid from regional donors, perceiving GCC states to be pursuing their own agendas and failing to deliver on some of their pledges for political purposes. To make their contributions most effective, GCC states must increase their coordination efforts with Yemen’s national and local authorities to fill gaps in projects’ planning, implementation, and evaluation, and to increase local buy-in to reconstruction processes. GCC states could also benefit from increasing their collaboration with Western donors who have more experience with monitoring and evaluating humanitarian delivery. Qasem concluded by saying that it is an opportune moment for GCC countries to refocus their interventions in Yemen to help integrate its institutions, bolster its economic capacity, and shift its focus to longer-term reconstruction projects.
Image
Jon B. Alterman
Senior Vice President, Zbigniew Brzezinski Chair in Global Security and Geostrategy, and Director, Middle East Program

Ala Qasem

Co-founder and managing partner at DeepRoot Consulting