On September 4, 2012, a group of donor countries referred to as the “Friends of Yemen” will be meeting in the Saudi capital of Riyadh to discuss the challenges facing Yemen after over one year of popular protests and humanitarian crises.
The Arab Spring has left the country’s economy in ruins, and the fragile security situation continues to put pressure on the government. According to the IMF, Yemen’s economy has contracted by 10.6%, while inflation has soared.
On Wednesday, August 29, 2012, the Minister for Planning and International Cooperation, Mohammed Al Saadi, said the country needed a total of $14 billion in budget aid, and had only $3 billion on hand to meet costs. The Yemeni Government hopes to return from Riyadh with pledges for the remaining $11 billion.
Yemen has undergone significant political change in the passed year. Under U.N. observation, the country’s transitional government has been implementing the GCC initiative, a large portion of which calls for restructuring the Yemeni military.
However, widespread unemployment, increasing food and gas prices, as well as shortages in electricity continue to plague the average Yemeni family on a daily basis. With approximately half a million internally displaced persons and an influx of refugees from East Africa, regions at the center of the ongoing internal conflict are particularly incapable of handling the crisis.
On Thursday, August 30, Saudi Arabia promised to deposit $1 billion at the Central Bank of Yemen to stabilize the Yemeni Riyal. In passed meetings of the “Friends of Yemen,” Saudi Arabia has pledged a total of $ 3.5 billion.
Protesters were driven to the street by high food prices and unemployment. After the yearlong demonstrations, Yemenis are hoping for improvements in the country’s economy. However, with the government focused on fighting Al-Qaeda and restructuring the military, economic development appears to be taking a back seat.