Business

Economists: Success of political settlement depended on government’s ability to shift approaches

National Yemen

Prime Minister Mohammed S. Ba-Sindwa

By: Ali Al-Awardhi

Amid expectations that a higher technical committee headed by Prime Minister Mohammed Basindowa will soon be formed to handle large donations to Yemen, an economic symposium has laid out conditions for a partnership between donors and the nation.

Among the most important needs is Yemen’s exemption from standing debts and the transfer of new donations into special grants. The program for stability and development, which was reviewed at the symposium by Dr. Mohammed Al-Haweri, focused solely on Arab Spring-related goals and the push for change in Yemen.

The program specified four priorities for the transitional phase, starting with the completion of a peaceful transition of power, the achievement of stability and, finally, the achievement of economic stability. Reaching economic stability is seen to represent the first step towards developing the national economy.

Chairman of the Yemeni Center for Strategic Studies Dr. Mohammed Al-Afandi said the symposium was important, as it discussed and evaluated the path to economic cooperation between Yemen and regional and international allies. He said he considered the donations to be the cornerstone for financing the reconciliation government’s investment needs during the nation’s transitional period.

Al-Afandi stated that any partnership must be effective, mutually beneficial, and measurable as far as satisfaction for both sides of partnerships is concerned.

Financing Needs

According to Dr. Al-Haweri, Yemen’s financing needs are open-ended and have no limits. “The phased program for stability and development tried to specify the fields and sectors which are priorities in the current phase and time period,” said Al-Haweri.

He stated that the program specified the financing needs for the transitional phase, which amount to around $4.7 billion. According to him, the most prominent mistakes of the former regime included a failure to meet financial pledges. He attributed this to the spread of corruption in the countries institutions and administrations, as well as legal obstacles connected with loan contracts.

Regarding following through on financial pledges recently made in Riyadh and New York, Al-Haweri spoke about a discussion between the government and the International Bank about following a path to overcome administrational complications before implementation comes into play.

Dr. Taha Al-Faseel emphasized the importance of reducing conditions for donors, and especially when it comes to UNDP grants. He also spoke about the importance of ensuring projects’ continuity after their financing has been completed. Al-Fassel also stressed the need to reduce costs concerned with the preparation of studies for – and observation of – projects.

Al-Faseel held successive Yemeni governments accountable for failures in economic partnerships between Yemen and the International Bank. He attributed this to the inability of the governments to control the use of donations.

In his paper, entitled “Evaluating the Yemeni Experience in Economic Partnerships with Donors and the International Bank and Fund as a Case Study,” Al-Faseel said that it was time to review the relationship between Yemen and the International Bank and Fund, and spoke of the need to fix it and make it a true relationship.

Al-Fassel based his thesis on the fact that changes in Yemen and protests against economic realities in various Arab countries such as Egypt and Jordan affirmed that policies concerned with the International Bank and Fund were no longer suitable and must be changed.