Middle East Policy has been one of the world’s most cited publications on the region since its inception in 1982, and our Breaking Analysis series makes high-quality, diverse analysis available to a broader audience.
Ian Siperco
Head of Practice, Middle East and North Africa, Riskline Political and Security Risk Analysis
The window of opportunity for Yemen to shape its own future is narrowing. Already the poorest country in the Arab world, the state that seems to be perpetually on the verge of collapse is facing a perfect storm of economic stagnation and chronic insecurity. An anticipated drop in state revenues from exportable oil over the next two years will cripple the delivery of basic government services and jeopardize the state’s already tenuous control over the country’s furthest reaches. And yet, what has often been overlooked in the alarmism that accompanies the failed-state narrative is the underlying driver of instability. Put simply, Yemen suffers from a flawed governance model that impedes reform and encourages the criminalization of the state. A failing economy, the current bloodshed in the south and the resurgence of al-Qaeda all have roots in the state’s abdication of its responsibility to act in the public interest.
Since first coming to power as leader of the Yemen Arab Republic (North Yemen) in 1978, President Ali Abdullah Saleh has balanced progress with nepotism, developing a fragile democracy only to see it discredited by rapacious elements of his own regime. Because he is primarily concerned with his own political survival, key military and cabinet postings are reserved for relatives and allies of his own northern Sanhan tribe. His son Ahmed, for example, commands the Republican Guard, while his nephews Yahya and Tarik control the Central Security Organization and private presidential security. Informed estimates place the cost of the arrangement at about a quarter of the budget in oil-revenue proceeds, loans, and donor grants subject to elite capture and misappropriation.
For as long as record global crude prices offset the cost of corruption, the government could afford to ignore the pressing need for budgetary rationalization. But Yemen today faces a trifecta of worst-case scenarios for the extractive industry. Along with a sharp drop in oil prices from over $120 in July 2008 to just under $50 four months later, the Saleh regime has been struggling to manage the depletion of known oil reserves and a corresponding decline of crude-oil production from a peak of about 460,000 barrels per day (bpd) in 2002 to the current rate of 280,000 bpd. In a country that relies on the oil sector for 90 percent of export earnings and 70 percent of government revenue, the failure to develop a diversified economy in years of relative prosperity looks increasingly like a potentially fatal misstep.
The international community, for its part, has responded to the crisis by awarding millions of dollars in donor pledges to bridge the gap to a diversified post-petroleum economy. Much of this aid flow is conditioned on the promise of substantive decentralization, electoral reform and a war on corruption. But the government lacks the political will to address these grievances, or they would have already been resolved. Instead, military spending consumes about 7 percent of GDP, while basic government services including water, education, health care and electricity remain generally inaccessible to 70 percent of the population.
The failure of President Saleh to meet his reform commitments rarely provokes a long-term response from Western donor countries, which tend to view Yemen primarily through the prism of security because of its close proximity to Saudi Arabia and the Gulf states. The knee-jerk reaction of the international community to any major terror attack in Yemen commonly produces substantially diminished demands for reform and a corresponding spike in aid flow to the Yemeni defense and security sector.
Many within Yemen’s domestic political opposition, as well as a number of ranking officials in the Yemeni government, have suggested that the regime has actively sought to exploit this enabling behavior by deploying Islamic extremists to play on the fears of the international community. Proponents of this theory — among them one-time foreign minister Abdullah al Asnag and independent MP Sakhr Al Wajih — suggest that specific terror attacks have been authorized by the heads of the Yemeni Political Security Organization, Central Security Organization and National Security Agency to manufacture instability and manipulate international perceptions.
No doubt this account is overly simplistic. Both the U.S. National Democratic Institute (NDI) and the Millennium Challenge Corporation (MCC) presumably operate independently of security concerns, and both have been unwavering in their enforcement of partial corruption-driven eligibility suspensions for democracy and governance aid to Yemen. What’s more, confirmed reports of an alliance between al-Qaeda elements and anti-government southern secessionists suggest that at least some militant operatives appear to be motivated by diverse agendas, including the desire to send a message to Saleh.
But Yemen has a troubling history of placating al-Qaeda operatives, and compelling evidence suggests that the Saleh regime maintains strong links to the organization’s leadership. These relationships existed for decades before finding formal expression in 2002 with the establishment of Judge al-Hittar’s “Dialog Program.” The program was developed as a pragmatic bid to reintegrate extremists into society and essentially functioned as an expedited release program for “reformed” jihadists. As a condition of release, the program obligated participants to promise not to launch attacks within Yemen. No such guarantee was required for operations on foreign soil.
The state’s refusal to issue a blanket condemnation of jihad ideology feeds into a paradoxical relationship between the Saleh regime and terrorist elements operating in Yemen. The long-running al-Houthi rebellion in the north provides a compelling example. On the one hand, President Saleh has repeatedly tried to portray the complex stop-go rebellion as a battle against terrorism. At the same time, Brigadier General Ali Mohsen al Ahmar, commander of the Northwestern Military Flank and a half-brother of the president, is strongly suspected of having deployed al-Qaeda extremists to train and lead tribal militias fighting the Shiite rebels. In exchange, the security forces agreed to “ease the persecution of (al-Qaeda) members.” News of the arrangement came to light in scathing exposés printed by Yemen’s Al-Share newspaper that subsequently landed its editor in Yemen’s State Security and Terrorism Court on charges of “threatening national security, demoralizing the military and divulging state secrets.” The Al-Share story focused on a deal struck between President Saleh and al-Qaeda front man Ayman al Zawahiri in January 2008 authorizing al-Qaeda terrorists to aid the military’s efforts against the northern rebellion.
This level of collaboration between top regime figures and extremist elements is by no means unprecedented. Many Bin Laden loyalists were awarded military salaries and official positions following the 1994 civil war, in which Saleh reportedly asked the militants to engage in violence against those bent on achieving the independence of South Yemen. As southern claims of institutionalized discrimination turned into calls for independence in the years that followed the war, President Saleh again turned to extremists to “secure the unity of Yemen” by targeting the southern separatist movement. As recently as January 2008, President Saleh was reported to be in negotiations with members of al-Qaeda in the Arabian Peninsula (AQAP) and the reportedly defunct Aden Abyan Islamic Army to deploy a second terrorist contingent in South Yemen. Echoing the earlier agreement by Saleh and Zawahiri, an intercepted communiqué issued by AQAP to local operatives confirmed that, in return for fighting on behalf of the state against southern oppositionists, President Saleh would grant prison releases and unimpeded travel to external theaters of jihad. New training camps have since been established under military direction, and the government is reported to have placed up to 160 Islamist militants in the southern governorate of Abyan on its payroll.
Western donor countries, including the United States, are understandably concerned by President Saleh’s penchant for making deals with known terrorists. But Yemen is among those regimes in the Middle East that manages to successfully extend one hand to terrorists and the other to the West. Given the likely domestic backlash generated by perceptions of excessive alignment with the United States, this is no easy task. Saleh has, in fact, shown an impressive commitment to cooperate with U.S. counterterror efforts, going so far as to sanction the deployment of U.S. Special Forces in Yemen to pursue suspected members of the al-Qaeda network. These pledges of support, selective though they may be, have been enough to convince policy makers that it is more reasonable to subsidize a fragile state that employs terrorists, than to reconstitute a failed state overrun with them.
In no small part because of these subsidies, Yemen in 2009 is not a failed or failing state, but it is a fragile one. Efforts at economic diversification have fallen flat, the government faces imminent conflict with the al-Houthi rebels in the north and secessionists in the south, and the country is plagued by chronic and widespread food and water shortages. Although it is quite possible that in the years ahead Yemen will muddle through as a ward of the international community, the impending economic crisis that will follow the depletion of known oil reserves is expected to hit Yemen hardest at just about the time that President Saleh’s term in office ends in 2013, leaving a power vacuum in his wake.
In this climate of uncertainty, the role of the international community and the policy choices it makes are critical. With the country’s fragile democracy already distorted by closely woven patrimonial networks, key international players must begin to uniformly enforce conditionalities on democracy and governance aid. Transparency in government accounting must be addressed as the cornerstone of a reform package that should grow to include parallel aid flows directly to local communities, where development initiatives could function independently of executive interference.
The United States must also take steps to ensure the Yemeni government does not abuse perceptions of unconditional entitlement to military funding from the Section 1206 account of the U.S. Department of Defense. A joint task force embedded within Yemen’s Supreme National Authority for Combating Corruption could avoid politically motivated charges of sovereignty violations, while ensuring that the Yemeni government is doing what it can to enforce existing legal actions against graft.
The outside world is beginning to appreciate the extent to which corruption has crept into every level of public service in Yemen. But for as long as the international community refuses to take seriously its role in guaranteeing accountability for the Saleh regime, the Yemeni people will continue to pay the price for their government’s criminal complacency.
Middle East Policy has been one of the world’s most cited publications on the region since its inception in 1982, and our Breaking Analysis series makes high-quality, diverse analysis available to a broader audience.
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Ian Siperco
Head of Practice, Middle East and North Africa, Riskline Political and Security Risk Analysis
The window of opportunity for Yemen to shape its own future is narrowing. Already the poorest country in the Arab world, the state that seems to be perpetually on the verge of collapse is facing a perfect storm of economic stagnation and chronic insecurity. An anticipated drop in state revenues from exportable oil over the next two years will cripple the delivery of basic government services and jeopardize the state’s already tenuous control over the country’s furthest reaches. And yet, what has often been overlooked in the alarmism that accompanies the failed-state narrative is the underlying driver of instability. Put simply, Yemen suffers from a flawed governance model that impedes reform and encourages the criminalization of the state. A failing economy, the current bloodshed in the south and the resurgence of al-Qaeda all have roots in the state’s abdication of its responsibility to act in the public interest.
Since first coming to power as leader of the Yemen Arab Republic (North Yemen) in 1978, President Ali Abdullah Saleh has balanced progress with nepotism, developing a fragile democracy only to see it discredited by rapacious elements of his own regime. Because he is primarily concerned with his own political survival, key military and cabinet postings are reserved for relatives and allies of his own northern Sanhan tribe. His son Ahmed, for example, commands the Republican Guard, while his nephews Yahya and Tarik control the Central Security Organization and private presidential security. Informed estimates place the cost of the arrangement at about a quarter of the budget in oil-revenue proceeds, loans, and donor grants subject to elite capture and misappropriation.
For as long as record global crude prices offset the cost of corruption, the government could afford to ignore the pressing need for budgetary rationalization. But Yemen today faces a trifecta of worst-case scenarios for the extractive industry. Along with a sharp drop in oil prices from over $120 in July 2008 to just under $50 four months later, the Saleh regime has been struggling to manage the depletion of known oil reserves and a corresponding decline of crude-oil production from a peak of about 460,000 barrels per day (bpd) in 2002 to the current rate of 280,000 bpd. In a country that relies on the oil sector for 90 percent of export earnings and 70 percent of government revenue, the failure to develop a diversified economy in years of relative prosperity looks increasingly like a potentially fatal misstep.
The international community, for its part, has responded to the crisis by awarding millions of dollars in donor pledges to bridge the gap to a diversified post-petroleum economy. Much of this aid flow is conditioned on the promise of substantive decentralization, electoral reform and a war on corruption. But the government lacks the political will to address these grievances, or they would have already been resolved. Instead, military spending consumes about 7 percent of GDP, while basic government services including water, education, health care and electricity remain generally inaccessible to 70 percent of the population.
The failure of President Saleh to meet his reform commitments rarely provokes a long-term response from Western donor countries, which tend to view Yemen primarily through the prism of security because of its close proximity to Saudi Arabia and the Gulf states. The knee-jerk reaction of the international community to any major terror attack in Yemen commonly produces substantially diminished demands for reform and a corresponding spike in aid flow to the Yemeni defense and security sector.
Many within Yemen’s domestic political opposition, as well as a number of ranking officials in the Yemeni government, have suggested that the regime has actively sought to exploit this enabling behavior by deploying Islamic extremists to play on the fears of the international community. Proponents of this theory — among them one-time foreign minister Abdullah al Asnag and independent MP Sakhr Al Wajih — suggest that specific terror attacks have been authorized by the heads of the Yemeni Political Security Organization, Central Security Organization and National Security Agency to manufacture instability and manipulate international perceptions.
No doubt this account is overly simplistic. Both the U.S. National Democratic Institute (NDI) and the Millennium Challenge Corporation (MCC) presumably operate independently of security concerns, and both have been unwavering in their enforcement of partial corruption-driven eligibility suspensions for democracy and governance aid to Yemen. What’s more, confirmed reports of an alliance between al-Qaeda elements and anti-government southern secessionists suggest that at least some militant operatives appear to be motivated by diverse agendas, including the desire to send a message to Saleh.
But Yemen has a troubling history of placating al-Qaeda operatives, and compelling evidence suggests that the Saleh regime maintains strong links to the organization’s leadership. These relationships existed for decades before finding formal expression in 2002 with the establishment of Judge al-Hittar’s “Dialog Program.” The program was developed as a pragmatic bid to reintegrate extremists into society and essentially functioned as an expedited release program for “reformed” jihadists. As a condition of release, the program obligated participants to promise not to launch attacks within Yemen. No such guarantee was required for operations on foreign soil.
The state’s refusal to issue a blanket condemnation of jihad ideology feeds into a paradoxical relationship between the Saleh regime and terrorist elements operating in Yemen. The long-running al-Houthi rebellion in the north provides a compelling example. On the one hand, President Saleh has repeatedly tried to portray the complex stop-go rebellion as a battle against terrorism. At the same time, Brigadier General Ali Mohsen al Ahmar, commander of the Northwestern Military Flank and a half-brother of the president, is strongly suspected of having deployed al-Qaeda extremists to train and lead tribal militias fighting the Shiite rebels. In exchange, the security forces agreed to “ease the persecution of (al-Qaeda) members.” News of the arrangement came to light in scathing exposés printed by Yemen’s Al-Share newspaper that subsequently landed its editor in Yemen’s State Security and Terrorism Court on charges of “threatening national security, demoralizing the military and divulging state secrets.” The Al-Share story focused on a deal struck between President Saleh and al-Qaeda front man Ayman al Zawahiri in January 2008 authorizing al-Qaeda terrorists to aid the military’s efforts against the northern rebellion.
This level of collaboration between top regime figures and extremist elements is by no means unprecedented. Many Bin Laden loyalists were awarded military salaries and official positions following the 1994 civil war, in which Saleh reportedly asked the militants to engage in violence against those bent on achieving the independence of South Yemen. As southern claims of institutionalized discrimination turned into calls for independence in the years that followed the war, President Saleh again turned to extremists to “secure the unity of Yemen” by targeting the southern separatist movement. As recently as January 2008, President Saleh was reported to be in negotiations with members of al-Qaeda in the Arabian Peninsula (AQAP) and the reportedly defunct Aden Abyan Islamic Army to deploy a second terrorist contingent in South Yemen. Echoing the earlier agreement by Saleh and Zawahiri, an intercepted communiqué issued by AQAP to local operatives confirmed that, in return for fighting on behalf of the state against southern oppositionists, President Saleh would grant prison releases and unimpeded travel to external theaters of jihad. New training camps have since been established under military direction, and the government is reported to have placed up to 160 Islamist militants in the southern governorate of Abyan on its payroll.
Western donor countries, including the United States, are understandably concerned by President Saleh’s penchant for making deals with known terrorists. But Yemen is among those regimes in the Middle East that manages to successfully extend one hand to terrorists and the other to the West. Given the likely domestic backlash generated by perceptions of excessive alignment with the United States, this is no easy task. Saleh has, in fact, shown an impressive commitment to cooperate with U.S. counterterror efforts, going so far as to sanction the deployment of U.S. Special Forces in Yemen to pursue suspected members of the al-Qaeda network. These pledges of support, selective though they may be, have been enough to convince policy makers that it is more reasonable to subsidize a fragile state that employs terrorists, than to reconstitute a failed state overrun with them.
In no small part because of these subsidies, Yemen in 2009 is not a failed or failing state, but it is a fragile one. Efforts at economic diversification have fallen flat, the government faces imminent conflict with the al-Houthi rebels in the north and secessionists in the south, and the country is plagued by chronic and widespread food and water shortages. Although it is quite possible that in the years ahead Yemen will muddle through as a ward of the international community, the impending economic crisis that will follow the depletion of known oil reserves is expected to hit Yemen hardest at just about the time that President Saleh’s term in office ends in 2013, leaving a power vacuum in his wake.
In this climate of uncertainty, the role of the international community and the policy choices it makes are critical. With the country’s fragile democracy already distorted by closely woven patrimonial networks, key international players must begin to uniformly enforce conditionalities on democracy and governance aid. Transparency in government accounting must be addressed as the cornerstone of a reform package that should grow to include parallel aid flows directly to local communities, where development initiatives could function independently of executive interference.
The United States must also take steps to ensure the Yemeni government does not abuse perceptions of unconditional entitlement to military funding from the Section 1206 account of the U.S. Department of Defense. A joint task force embedded within Yemen’s Supreme National Authority for Combating Corruption could avoid politically motivated charges of sovereignty violations, while ensuring that the Yemeni government is doing what it can to enforce existing legal actions against graft.
The outside world is beginning to appreciate the extent to which corruption has crept into every level of public service in Yemen. But for as long as the international community refuses to take seriously its role in guaranteeing accountability for the Saleh regime, the Yemeni people will continue to pay the price for their government’s criminal complacency.