$130 million credit to Yemen approved by World Bank [Archives:2002/33/Local News]

On Thursday August first, the World Bank approved USD 130 million in the form of credit to Yemen to upgrade the urban water supply and sanitation services. The first phase of the Urban Water Supply and Sanitation Project (UWSSP) aims to increase water supplies in densely populated urban areas through improving operation and reduction of the water scarcity.
The UWSSP is also funding projects to enable the use of recycled waste water for agricultural purposes.
The proposed project falls in line with the banks country assistance strategy for Yemen whose objectives include prompting environmental sustainability with a strong focus on water management.
The urban water and waste water sectors in Yemen are confronted with major challenges in the face of increasing water shortage in the country. The sector has been unable to cover expenses and cost of new investments. In addition, the National Water and Sanitation Authority and its branches are in need of more effective managerial and technical capabilities.
As services from local corporations improve, it is expected that low-income households will rely less on higher-priced water supplied by private vendors. This will ease the burden on the household budget and relieve women and children, in particular, from the time-consuming task of fetching and carrying water.
The International Development Agency (IDA), an arm of the World Bank Group, which provides interest-free development assistance to the poorest countries, will issue the credit. The overall project cost is USD 150 million. The World Bank credit of USD 130 million will be disbursed on standard IDA terms with a 10-year grace period and a maturity of 40 years, and the Government of Yemen will contribute USD 20 million.
On the other hand, the World Banks Board of Executive Directors reviewed and discussed the Poverty Reduction Strategy Paper (PRSP) drafted by the Government of Yemen with extensive consultation among agencies and with civil society, including parliamentarians, academia, female groups, media as well as community based groups representing the poor.
The PRSP reveals that poverty in Yemen is predominantly a rural phenomenon, with 83 percent of the poor and 87 percent of those under the food poverty line living in rural areas. It concluded that Yemens current public expenditures in sectors such as health and education do target the poor, but the services fall short of addressing the magnitude of the urban-rural gap and the gender gaps.
In response to these challenges, the PRSP was designed around four major pillars aimed at raising the living standards of the poor. They include achieving a high and sustained rate of economic growth, enhancing human resource development, upgrading the basic infrastructure, expanding access to basic services, and strengthening the social safety nets.
The overall sense of the board meeting was that the PRSP prepared by the Yemeni authorities and civil society marks the end of the beginning. Now the real process begins in putting the poverty reduction strategy into practice, said Mohammed Ayub, Country Director for Yemen, following the Board meeting. I am confident that the commitment and ownership demonstrated by the government of Yemen in this first phase will continue in the implementation phase.

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