Yemen to ask for $10 billion from donors: minister

May 2, 2012

AFP - Yemen will ask donors for about $10 billion in urgent aid at a "Friends of Yemen" meeting to be held in the Saudi capital later this month, the country's planning minister said on Wednesday.

"We are talking about $10 billion that we will need for economic recovery, to stabilise the economy and the currency," Mohammed Said al-Saadi told AFP on the sidelines of a donors conference in Sanaa.

"This is just an estimate at this point," he said adding that "these figures will be discussed" even though the meeting of foreign ministers from the Gulf countries, and representatives of the United States, the European Union and the United Nations in Riyadh on May 23 will focus mainly on political aspects of Yemen's transition.

The interim transitional government is in the process of finalising an emergency plan to relaunch its shattered economy, still reeling from a year-long uprising that forced veteran leader Ali Abdullah Saleh out of power.

According to the minister, the plan sets out the most "urgent priorities," including a spiralling food crisis that the United Nations estimates has affected some 10 million Yemenis.

The plan will also focus on rebuilding infrastructure, specifically electricity, water and oil products, and ensure that severely debilitated health and social services are restored, he added.

But Western diplomats at Wednesday's meeting said they were unlikely to make any financial commitments until a formal donor conference, known as the Consultative Group Meeting, to be held in early July.

According to one European diplomat, the $10 billion dollar request is also "not realistic."

Speaking on condition of anonymity, the diplomat said the problem was not that donors were unwilling to lend their support, but rather they fear Yemen's new government is ill-equipped to allocate the funds efficiently.

"The problem is the capacity of the ministries to spend the money," the diplomat said adding that donor nations are now working with the Yemeni government to "increase" that capacity.

Philippe Jacques, counsellor at the European Union's Development Cooperation in Sanaa agreed, saying the issue was not money, but rather preparedness.

"The projects are not ready," said Jacques. "You can't just have a shopping list, you also have to be prepared" to implement them.

He said a proposal for a strategic partnership with the donors put forth by the Yemenis at Wednesday's meeting was a positive step because it put the burden on the government to coordinate the donors.

"Will they be able to do it? That's the big question," he said.

Donor representatives and Yemeni officials cautioned that high expectations among Yemenis, coupled with the government's limited resources and security difficulties that are hindering access to those most in need remain a serious source of concern.

"The expectations for change are so high they cannot be fulfilled," said the diplomat who asked to remain anonymous adding that despite the dire political and economic conditions in the country, "there is still a large gap" in aid funding.