The World Bank's role in Yemen's transition period and the need for CSO engagement

1 June 2012

BIC outlines the World Bank's current activities in Yemen and proposes that civil society engagement is necessary now more than ever.

Throughout 2011, Yemenis fought for their right to a democratic country free of corruption and dictatorship. The country underwent an extremely painful and difficult year in which the regime’s forces fought the rebellion, and used the withholding of basic services such as electricity as political pawns in the fight to retain power. Meanwhile, international institutions and bilateral donors halted aid to Yemen either in protest of the regime’s actions, or due to their inability to monitor how the government was spending the funds. The World Bank was one such donor and in July 2011 released a statement announcing that all disbursements to Yemen would be temporarily suspended.

The Bank restarted operations in January 2012 in a limited way, but since the February election which passed the political reins to Abdrabbo Al-Hadi, the Bank’s role in the transitional period has become increasingly clear and strong. The DC-based institution may not be the biggest lender in the game - indeed the Friends of Yemen conference that took place on May 23rd proved that countries like Saudi Arabia will continue to lend impressive sums to Yemen – but it certainly deserves our attention.

Yemen is considered one of the poorer countries in the Bank’s portfolio, and as such the Bank provides grants to the country as opposed to loans. Historically however, even though the amounts that the Bank gives to Yemen are not very substantial relative to some other Middle East and North Africa countries like Egypt or Morocco, Yemen has not been able to absorb all the money that the Bank has given it. Moreover, certain projects have had more success than others with respect to implementation and results. Consequently, the Bank plans to re-evaluate and restructure its existing portfolio in the country keeping the “good” projects and canceling others that were not seeing success. This is unusual for the Bank which ordinarily prefers to keep the money flowing out of its door, and it is curious as to whether this type of sensible decision would have been made had it been loans we were talking about rather than grants.

Beyond its project portfolio, the World Bank has been leading efforts on a social and economic assessment alongside the European Union, the United Nations, and the Islamic Development Bank, to determine the impact of the past year’s political crisis on the economic and social condition of Yemen. Moreover, the Bank is providing technical assistance to the government on its economic transition plan. Very importantly, the Bank will be coordinating and co-chairing a donor conference that will be taking place in the coming months.

While Yemeni civil society was unfortunately not invited to be a part of the Friends of Yemen conference, a number of groups have asked the Bank to give space to civil society at the upcoming donor conference. It is yet to be seen how the Bank will respond to this request but the outlook is positive. This is after all not a novel concept; civil society and the private sector, for that matter, have been present at several donor conferences that the Bank has coordinated in the past, including in Uganda and Nepal.

The involvement of civil society in activities being discussed and proposed by international organizations and by the government of Yemen is one of absolute necessity. Some say that a revolution took place in Yemen, but we could also consider that the revolution is still in motion and as such, bringing those voices to the table would be useful at any moment in time but bringing them in now is particularly critical. This is the moment when the blueprints for this country's future are being drawn up; the constitution is being drafted, the laws are being made, and the economic plans which could affect every one of Yemen's 24 million people are being developed. These plans can not be made behind closed doors - all stakeholders should be involved. While these documents are in their budding stages, civil society is not. There is a lot that Yemeni civil society has to offer, but there need to be the opportunities to do so.

In order for there to be meaningful engagement, timely information and the availability of space is key. This is what the World Bank and other international institutions can and should do. This is also what they should encourage the government of Yemen to do. On the other hand, Yemeni civil society also has to step up and be ready to engage; ready to read and analyze that information and ready to participate in that space.