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Yemen assured of assistance by Gulf states

Government says it is waiting for $7.9b of international aid to be fully credited

Gulf News

Sana’a: Gulf Arab countries have promised Yemen aid on top of the $7.9 billion (Dh29 billion) pledged by foreign donors last autumn, but an amount has yet to be specified, a Yemeni government minister said on Monday.

“We got promises from the Gulf ... regardless of previous commitments ... to fund other projects,” said minister of planning and international cooperation Mohammad Al Sa’adi, whose ministry negotiates with donors.

Al Sa’adi said Yemen had received promises that any additional projects will be funded by Gulf donors once the government has allocated the initial $7.9 billion of aid.

The country is seeking an additional $4 billion in aid, mainly from wealthy neighbours such as Saudi Arabia, to fix its public finances and revive a crumbling economy hit by unrest and clashes with militants.

Yemen’s economy nearly collapsed after a year-long uprising that pushed long-time president president Ali Abdullah Saleh from power in February 2012 and allowed Al Qaida militants to infiltrate lawless tribal regions.

Restoring stability is seen as key by Washington and Gulf countries because of Yemen’s location on the important Red Sea oil shipment route and the threat from Al Qaida.

Donor pledges in September by the Friends of Yemen group came short of $12 billion sought by the government to solve the humanitarian and budget crisis and upgrade infrastructure.

The World Bank said at the time the pledges should be enough to meet budget shortfalls in the cabinet’s reconstruction plan over the next 18 months.

Nearly four months after the pledges were made, Yemen has only received a $1-billion loan, deposited by Saudi Arabia in the central bank, with the remaining funds delayed by technical issues or lagging approvals by donor heads of state, Al Sa’adi said.

The Yemeni government has already identified and costed most projects it would like to get aid for and is waiting for donor countries to approve funding for the proposed projects, he said.

“Many donors have already agreed on these projects, and there are upcoming meetings with these countries,” Al Sa’adi said. “Some Gulf states say that they need top-level directives from the heads of states, while others such as Kuwait need the approval of parliament.”

The Arabian Peninsula state has yet to receive some $3 billion promised by donors in 2006. That aid was delayed due to disagreements over which projects the money should be spent on, with some countries holding money back for political reasons.

The Friends of Yemen is a group including the five permanent members of the UN Security Council — China, France, Russia, Britain and the United States — and six Gulf Arab states.