IN the marketplace in Saywun, the capital of the Wadi Hadhramaut in the heartland of southern Arabia, just behind the magnificent Sultan's Palace, Ahmed Sarheed still sells frankincense and myrrh from rush baskets placed in front of his tiny store front, as he has for 70 years.
"Business isn't good," his son says. The Westerners who now flock to the Hadhramaut pass by. They seem unaware that the fragrant amber and pearly chunks of hardened tree sap once earned Yemen vast wealth, when incense was a vital part of pagan rituals in the Roman Empire.
Today the commodity of great value is oil, and no one is passing by. Dozens of oil companies are looking for reserves on the scale of those in neighboring Saudi Arabia.
Three years after unifying its traditional north and socialist south, Yemen, the most populous nation on the Arabian Peninsula and one of the world's poorest, is on the verge of an economic renaissance. The country held its first democratic elections last month, opening the door to greater development. As in the incense-trading Classical age, this verdant valley, wedged between the arid cliffs of the Jol mountain range, lies at the center of that progress.
"The three years between unification and the elections have held us up, everything was frozen. But now we are ready to go forward," says the local governor of Sawyun, Col. Abdel Rahim Atiq. He believes that while oil wealth would be an asset, "it should not be the main economic base - in Hadhramaut we have agriculture, tourism, and fisheries to develop and we want industry." Indeed, the search for oil has led to new discoveries about Yemen's antiquity and revealed untapped reserves of water.
So far the oil finds have been modest. But Yemenis are eager to have oil if only to lessen their economic dependence on Saudi Arabia, which for decades was the source of most of the foreign earnings that kept Yemen afloat. When Yemen criticized the coalition attack on Iraq during the Gulf war, the Saudis retaliated by deporting roughly 1 million Yemeni workers and cutting off aid.
Canadian Occidental Petroleum, the most successful oil interest in the valley, is about to begin production. As of Sept. 26, 120,000 barrels a day will flow from its fields southeast of Saywun through a pipeline that crosses the barren Jol plateau and winds down to the Gulf of Aden near Ash Shihr.
The grueling process of building that pipeline has revealed much about the Hadhramaut's past. "This is the area where frankincense was gathered during the Classical period," says Bukhard Vogt of the German Archeological Institute, who leads an archaeology project initiated and funded by Canadian Occidental. The first of its kind undertaken by an oil company in Yemen, the project is an effort to preserve the region's historical legacy.
"At first we thought the overlap between the pipeline route and the camel trails was coincidental, but now we realize that the pipeline has been laid along the cheapest and easiest route, which is not always the shortest, just as the incense caravans traveled 2,000 years ago," he says.
Despite the intense heat and the rigors of the terrain, Dr. Vogt's team has pinpointed roughly 300 prehistoric sites along the 90-mile pipeline. Many of those sites are ancient graves indicating that southern Arabia has been inhabited for at least 7,000 years.
The exploration for oil also has revealed a resource that may be more important to the Arabian peninsula than oil: water.
"We have discovered vast reserves of water while drilling for oil in the Hadhramaut region, so much so that we have contributed $2 million to the government of Yemen to study the reserves," says Essam Zaghloul, a member of Canadian Occidental's community affairs team, which is sinking wells and grading roads to aid development in isolated settlements.
The Hadhramaut is seen as a particularly promising region for agriculture. The valley was long isolated under the rule of the hard-line communist government of former South Yemen, which was closely allied with the Soviet Union. After two decades of disastrous state farming techniques, land is being returned to its original owners.
"Now people are taking farming very seriously. They are the owners and they are committed to farming," says Abdullah Salem Ba Atwa, who recently recovered his land from state control.
In antiquity the Hadhramaut relied heavily on monsoon rains for irrigation, conserving flood waters with an elaborate system of dams and canals. Archeological expeditions have located some 60 small dams along the 100-mile valley. "The wealth of southwestern Arabia was based on the ability to irrigate their fields using extremely sophisticated techniques, not merely on the incense trade," Vogt suggests.
While Yemeni farmers still terrace fields to conserve water, and pump from aquifers, only 10 percent of the Hadhramaut's rich soil is now under regular cultivation.
While Yemen's economy still depends largely on remittances from Yemenis working in the Gulf and the unemployment rate hovers at about 36 percent, officials hope underground water supplies will promote agricultural growth. "We already have the project proposals and now that the elections are over peacefully, we can proceed seriously with the World Bank," says Colonel Ahmed, the local governor.
The World Bank has funneled nearly $40 million into improving traditional flood irrigation and the sinking of tube wells to irrigate roughly 8,000 acres. "We currently have some 15 projects in Yemen in the agricultural sector and we are considering opening a World Bank office in Sana," says Nejdet al-Silihi of Bank's Yemen desk.
But younger people still rest their hopes more on oil than farming. Rayda Saleh al-Attas, a teenager, hopes oil will allow him to stay in the Hadhramaut, rather than following the waves of emigrants before him who were forced to seek work elsewhere in the Gulf, Indonesia, or east Africa.
"If we have an oil industry, I'd stay and work. Otherwise I will have to leave. It's in the hands of God," he says.