Millions in aid linked to Yemeni reform
Washington has just given its ally another chance to receive development aid.
By Ginny Hill | Contributor to The Christian Science Monitorfrom the February 27, 2007 edition
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SANAA, YEMEN - President Ali Abdullah Saleh was en route to Washington in 2005 for talks on his country's role in the "war on terror" when his entourage learned that Yemen would be dropped from a list of countries hoping for millions in US aid.
But no one in his retinue dared broach the subject with President Saleh, says a Sanaa source familiar with the trip. The leader, who had long denied that his country has a corruption problem, wouldn't learn until he reached the White House that Yemen was cut from the list of nations eligible to apply for the Millennium Challenge Account (MCA), a Bush administration plan that ties aid to governance benchmarks.
"It came as a real shock," says the source. "It was only then that the scale of Yemen's problems sank in."
While the November 2005 trip was a public embarrassment for Saleh, it marked a turning point in how his government began dealing with corruption.
In the beginning of 2006, he launched an ambitious anticorruption program, and on Feb. 14, the Millennium Challenge Corporation (MCC), which administers the MCA, reinstated Yemen's chance for assistance as a result of an "aggressive reform effort."
Now, this fragile state on the tip of the Arabian Peninsula could gain hundreds of millions of dollars in aid, if it can sustain reform momentum. Yemen is the poorest Arab country – almost half the population is illiterate and 1 in 10 people live on less than $2 a day.
"Our economy is heavily dependent on oil supplies that won't last more than 15 years and the water table is dropping at an alarming rate," says Ali Saif Hassan, director of Yemen's Political Development Forum, an independent think tank. "The current reform program is very welcome, but there's a danger that the speed of the approaching resources crisis will outpace the process of transformation."
Saleh's reward for his U-turn has more political value than immediate financial benefit. The country still has many hoops to jump through before it can claim the prize of full participation in President Bush's aid program.
Yemen is now embarking on a round of negotiations that will force it to define its intentions. If Yemen is accepted to join the MCC's Threshold Program during the next few months, it will receive funds to speed up early reforms that will allow Yemen to apply for full membership, known as compact status, in a few years' time. The process can be suspended at any time.
"Continued participation in the MCA program is contingent upon good performance on the policy benchmarks," says John Danilovich, chief executive officer of the MCC.
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