Donors Support Yemen’s Transition with US$6.4 Billion
The international community rallied behind Yemen’s Government of National Reconciliation, pledging US$6.4 billion to support the country’s urgent stabilization and development needs and to assist its ongoing political transition over the next 18 months.
Donors committed to help the government deliver urgent services to the neediest, create jobs, and stabilize the economy in Yemen, where 10 million people have no food security, more than half of the population lives on less than US$2 a day, and unemployment has reached rates as high as 40 percent among young people.
The Government of Saudi Arabia, which set a generous level of assistance by pledging US$3.25 billion to its southern neighbor ahead of the meeting, is hosting the two-day donors’ conference in Riyadh, which has gathered more than 280 participants representing 27 bilateral donor countries and 36 regional development and international finance institutions. Also attending are observers representing Yemen’s private sector and national, regional, and international non-government organizations.
In preparation for the conference, the Yemeni Government and its donors developed a Mutual Accountability Framework (MAF) outlining their respective responsibilities in the urgent task of improving living conditions for Yemeni citizens and laying the foundation for future growth.
This was welcomed in Riyadh as an indispensible guide to structure international support for Yemen’s economic recovery plan, the Transitional Program for Stabilization and Development, about which development partners expressed confidence today.
“In response to the extraordinary challenges it faces, the Government of National Reconciliation has proposed this very ambitious plan for economic recovery which will need our support,” Inger Andersen, World Bank Regional Vice President for the Middle East and North Africa, told the conference. The World Bank pledged to add US$400 million in new resources over the coming two years to its existing program of US$700 million in commitments to ongoing projects in Yemen.
Andersen added: “The Mutual Accountability Framework will ensure that all promises of aid are kept, that they are aligned with national priorities, and matched with specific programs and projects that are implemented both effectively and transparently.”
The Yemeni Government’s economic plan anticipates the need for US$11.9 billion in supplementary funding, divided between US$4.3 billion for the short term and US$7.6 billion for the medium term. The funding goal for the donor conference was US$6 billion to cover the transition period lasting until April, 2014. Following this transition, a second donor conference will invite support for the subsequent phases of the country’s development plan.
“Yemen will need predictable and regular sources of funding to keep up the momentum on reforms and to keep the hopes of all Yemenis alive,” said Hartwig Schafer, incoming World Bank Country Director for Yemen, Egypt and Djibouti. “Significant progress has been achieved on the political and security fronts, but these need to be matched and consolidated with equally significant progress on economic reforms, improving governance, and partnering with the private sector and civil society.”
A Government of National Reconciliation was formed in Yemen following the adoption of a Gulf Cooperation Council initiative to resolve the country’s political crisis. The new government has focused on implementing the main principles of the initiative, which call for the adoption of a plan for economic recovery and addressing the immediate needs of the population.