Archive for the ‘Yemen’ Category

The Dead Hand of Socialism: State Ownership in the Arab World

September 12, 2014 Comments off

The Dead Hand of Socialism: State Ownership in the Arab World
Source: Cato Institute

Extensive government ownership in the economy is a source of inefficiency and a barrier to economic development. Although precise measures of government ownership across the Middle East and North Africa (MENA) are hard to come by, the governments of Algeria, Egypt, Libya, Syria, and Yemen all operate sizeable segments of their economies—in some cases accounting for more than two-thirds of the GDP.

International experience suggests that private ownership tends to outperform public ownership. Yet MENA countries have made only modest progress toward reducing the share of government ownership in their economies and are seen as unlikely candidates for wholesale privatization in the near future.

MENA countries need to implement privatization in order to sustain their transitions toward more representative political systems and inclusive economic institutions. Three main lessons emerge from the experience of countries that have undergone large privatization programs in the past. First, the form of privatization matters for its economic outcomes and for popular acceptance of the reform. Transparent privatization, using open and competitive bidding, produces significantly better results than privatization by insiders, without public scrutiny. Second, private ownership and governance of the financial sector is crucial to the success of restructuring. Third, privatization needs to be a part of a broader reform package that would liberalize and open MENA economies to competition.

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Middle East Transitions: A Long, Hard Road

August 11, 2014 Comments off

Middle East Transitions: A Long, Hard Road
Source: International Monetary Fund

Since the onset of the Arab Spring, economic uncertainty in Egypt, Jordan, Libya, Morocco, Tunisia, and Yemen (Arab Countries in Transition, ACTs) has slowed already sluggish growth; worsened unemployment, particularly of youth; undermined business confidence, affected tourist arrivals, and depressed domestic and foreign direct investment. Furthermore, political and social tensions have constrained reform efforts. Assessing policy options as presented in the voluminous literature on the Arab Spring and based on cross-country experience, this paper concludes that sustainable and inclusive growth calls for a two pronged approach: short term measures that revive growth momentum and partially allay popular concerns; complemented with efforts to adjust the public’s expectations and prepare the ground for structural reforms that will deliver the desired longer tem performance.

CRS — Yemen: Background and U.S. Relations (updated)

February 25, 2014 Comments off

Yemen: Background and U.S. Relations (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

This report provides an overview and analysis of U.S.-Yemeni relations amidst evolving political change in Yemeni leadership, ongoing U.S. counterterrorism operations against Al Qaeda in the Arabian Peninsula (AQAP) operatives at large in Yemen’s hinterlands, and international efforts to bolster the country’s stability despite an array of daunting socio-economic problems. Congress and U.S. policymakers may be concerned with prospects for stabilizing Yemen and establishing strong bilateral relations with future Yemeni leaders.

FACTBOX — Women’s rights in the Arab world

November 23, 2013 Comments off

FACTBOX — Women’s rights in the Arab world
Source: Thompson Reuters

Egypt is the worst country for women in the Arab world, closely followed by Iraq, Saudi Arabia, Syria and Yemen, according to gender experts surveyed in a Thomson Reuters Foundation poll released on Tuesday.

Comoros, Oman, Kuwait, Jordan and Qatar came top of the survey, which assessed 22 Arab states on violence against women, reproductive rights, treatment of women within the family, their integration into society and attitudes towards a woman’s role in politics and the economy.

The results were drawn from answers from 336 gender experts invited to participate in an online survey by the foundation, the philanthropic arm of the news and information company Thomson Reuters, in August and September.

+ Complete poll results

US: Reassess Targeted Killings in Yemen

October 23, 2013 Comments off

US: Reassess Targeted Killings in Yemen
Source: Human Rights Watch

United States targeted airstrikes against alleged terrorists in Yemen have killed civilians in violation of international law, Human Rights Watch said in a report released today. The strikes, often using armed drones, are creating a public backlash that undermines US efforts against Al-Qaeda in the Arabian Peninsula (AQAP).

The 102-page report, “‘Between a Drone and Al-Qaeda’: The Civilian Cost of US Targeted Killings in Yemen,”examines six US targeted killings in Yemen, one from 2009 and the rest from 2012-2013. Two of the attacks killed civilians indiscriminately in clear violation of the laws of war; the others may have targeted people who were not legitimate military objectives or caused disproportionate civilian deaths.

Arab Countries in Transition – Economic Outlook and Key Challenges – Deauville Partnership Ministerial Meeting

October 11, 2013 Comments off

Arab Countries in Transition – Economic Outlook and Key Challenges – Deauville Partnership Ministerial Meeting
Source: International Monetary Fund

In an environment of heightened socio-economic tensions, regional insecurity, and strained public finances, the Arab Countries in Transition (ACTs) 1 face the difficult task of delivering on the expectations for jobs and growth. Despite patchy improvements in some countries, economic growth remains subdued, private investment is weak, and external and fiscal buffers are running low. Fostering social cohesion and avoiding a downward spiral of economic and political malaise calls for urgent implementation of economic reforms and coordinated support from the international community.

New Report: Yemen’s Stability Threatened

October 7, 2013 Comments off

New Report: Yemen’s Stability Threatened
Source: Chatham House

Yemen’s political transition, which has been held up as a potential model for conflict-affected states, is due to come to an end with a round of elections scheduled for 2014. Backers of the country’s peace plan believe that it will usher in a new, more equitable and peaceful era for Yemen.

But new research from Chatham House’s Yemen Forum shows that the structure of the political economy built up under former president Ali Abdullah Saleh has not been significantly affected by the transition, and that the same elite actors who set the country on a path to economic ruin are likely to prevail after the elections.

A new report, Yemen: Corruption, Capital Flight and Global Drivers of Conflict, argues that international factors, including capital flight to tax havens, play a role in encouraging corruption and developmental dysfunction in Yemen, the Arab world’s poorest country. Similar drivers are likely to play a role in blocking reform in the future.

Yemen was the world’s fifth largest source of illicit capital flows among Least Developed Countries between 1990 and 2008, with $12bn leaving the country. For every dollar spent on aid during that period, $2.7 left Yemen illegally, with politicians routinely using private banking channels to transfer their money into safer, more profitable jurisdictions outside Yemen, often in donor states.

The chronic problem of capital flight links Yemen to a wider global governance agenda over tax havens (secrecy jurisdictions), an issue that has been steadily rising in importance on the G8 and OECD policy agendas. While Yemen’s elites are able to systematically extract rents from oil, smuggling and aid, and siphon them out of the country, they have little or no incentive to improve the domestic situation, and tax revenues that are needed to fund Yemen’s development are undermined.

Meanwhile, security interests have shaped the strategy of Western and Gulf states in Yemen in the past decade, in which military aid to the Saleh regime has grown much more rapidly than development aid. However, short-term counter-terrorism priorities are not always consistent with domestic perceptions of political legitimacy, and the US drone strategy – supported by President Hadi – risks undermining Yemen’s stability in the long term.

All too often the focus on ‘fragile states’ revolves around domestic dynamics and ignores the international factors that incentivize personal enrichment at the cost of good governance. The report recommends that Western donors widen the scope of their political economy analysis to address the interaction between domestic and international factors that cause corruption in Yemen, and that the role of secrecy jurisdictions should be included in the revised Millennium Development Goals, beyond 2015.


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