What will donors require from Yemen’s government? [Archives:2006/997/Opinion]

November 9 2006

By: Faisal Al-Safwani
The London conference of donors on Yemen scheduled in mid-November will be an important event in the history of the Yemeni economy. The conference is to discuss the mechanism of supporting and developing the Yemeni economy and improving its performance. It's an embodiment of regional and international economic partnership.

The conference convenes the General Secretariat of the Gulf Cooperation Council, the regional partner, the World Bank, the UN Development Program, Britain and the United States, and they are all potential international partners for Yemen. The conference is not expected to offer magical solutions to Yemen's accumulated economic problems, but it can help in beginning to find solutions and to prepare the economy to achieve the sought after economic reform.

It is decided that the Yemeni delegation taking part in the donors conference to be a high-ranking one and some preliminary information says the Yemeni government will submit definite demands, to ensure they receive US $ 1.1 billion every year over five years to bridge the gap in the general budget between resources and expenditures over the next years.

The GCC General Secretariat, Abdulrahman Al-Attiyah, said they want to convince donors the Yemeni government was serious in its reform program, adding that the task of the Yemeni delegation will be to win the donors trust.

To do that the Yemeni official delegation is expected to present documented papers pertaining the five-plan of 2006-10, accounts of the previous reforms, a document on the policy of fighting poverty, the policy of encouraging investment and other policies as well as the economic programs by which the government will convince the donors to give grants and loans necessary for the entire process of the economic reform.

According to Gulf and Yemeni press statements on the subject, there appears to be willingness in principle by the donors to offer support and assistance, but they have certain conditions and demands that must be taken into consideration. They want to see the specific steps the Yemeni government will take and defining time stages. Some of them suggest grants have to be offered in the form of investment projects and the investment movement will impose requirements of the economic reform and automatically contribute to reform them. Investment projects need to improve energy production, infrastructure, banking systems, availability of money liquidity, commercial judiciary and qualified labor. These factors are not available at present. This list makes the task of the Yemeni delegation somewhat difficult, in case such demands were submitted. The international donors aim to develop the major sectors of the economy in general, such as agriculture, industry and trade. Without development of different sectors there will be no economic reform and without modernization of the economic system development will not be achieved and Yemen will not be accepted into the GCC and it will not be reinstated into the Millennium Challenge Account.

The present situation of Yemen's economic system has changed into a problem hindering our development and makes it difficult to join economic groups, regionally and internationally. The coming conference is considered a big opportunity that can be used to create a qualitative transfer in the Yemeni economy, improving its performance and activating all its sectors.

We no longer have time or opportunity for obstinacy at the expense of our economic and living needs. We have to emphasize to the donors and neighbors our seriousness about reforming our economic situations in the way compatible with the GCC economic systems and show our sincere desire for reform.

Faisal Al-Safwani is a Yemeni journalist