Three killed in clashes in two regions of Yemen

By Mohammad Ghobari

Thu Jul 21, 2011

SANAA (Reuters) - Three people were killed in clashes in two regions of Yemen between forces loyal to President Ali Abdullah Saleh and his opponents, who are growing increasingly frustrated they have failed to oust him.

In Taiz, opposition sources said Saleh loyalists opened fire on protesters, killing one, when they tried to leave a city square where they have camped out for nearly six months calling for an end to Saleh's three-decade rule.

Saleh's tenacity has frustrated protesters who thought his time was up when he flew to Saudi Arabia for medical treatment last month following an assassination attempt, leaving impoverished Yemen in political limbo.

As the stalemate goes on, clashes have broken out between the Republican Guard, which is commanded by Saleh's son, and armed pro-opposition tribesmen who say they are defending the protesters.

Fighting between the Republican Guard and armed men on Thursday killed two people in Arhab, which has been the scene of shelling and gun battles during the past three days.

It was not known whether those killed had taken part in the fighting or if they had been hit in the crossfire.

Western powers and neighboring oil giant Saudi Arabia, both targets of Yemen-based Al Qaeda in the Arabian Peninsula, have tried to contain rising chaos by pressing Saleh to sign a Gulf-brokered plan to hand over power.

But he has backed out of the deal three times at the very last minute and has vowed to return to Yemen.

Yemen's economy

Up the spout

How turmoil is ruining an already rocky economy

Jul 21st 2011 | SANA’A

“IT’S shit, the situation in Yemen,” says a skinny man in a bakery in the old quarter of Sana’a, the capital. “Shit,” he says forcefully, as he walks out with a plastic bag of bread rolls, the price of which has soared by 50% in the past two months. Outside lorries trundle by, selling water at three times the usual price to the many households where the public water supply has failed. The occasional taxi sputters past, coasting downhill to save petrol and charging at least twice the usual rate due to fuel shortages. More firewood is being sold because cooking gas is now scarce.

Neglected for decades by the government of President Ali Abdullah Saleh, Yemen’s economy was deteriorating before the unrest began five months ago. But as the protests inspired by the Arab spring have widened in scope and become more violent, they have helped to send the economy into freefall. The currency is collapsing. Famine is looming in the country’s rugged interior.

Attacks by angry tribes on oil pipelines have made it more expensive to produce and transport food and water. The government now has to import fuel, doubling its monthly import bill to around $500m. The tax take, never large, has vanished. Central bankers are under pressure to raid reserves, said to be around $4.5 billion. Factories are shut because they lack fuel. Countless casual jobs have been lost.

While the economies of nearly all Arab countries have been hurt by protests, Yemen’s decline has been more dramatic because it was so poor to begin with. Mr Saleh, wounded last month in a bomb attack on his presidential compound and now in hospital in Saudi Arabia, has presided over an economy as centralised as it is corrupt.

Since the early 1990s two shocks have reshaped it. First, Yemen’s refusal to endorse military action against Iraq when Saddam Hussein invaded Kuwait in 1990 so annoyed the Saudi and Kuwaiti governments that they expelled a million Yemeni migrant workers, costing the country huge sums in remittances. Second, at around the same time, oil was discovered in Yemen, so that a population that had been economically autonomous began to depend heavily on a suddenly richer state. Mr Saleh had previously asserted his power via handouts to tribal sheikhs and political allies. With more money available, a culture of corruption took root.

“Saleh institutionalised bribery from the coast to the mountains, encouraging it rather than punishing it,” says a businessman in Sana’a. The Yemeni elite’s route to prestige, he explains, was to have a job in government and exploit it to make money, a problem that went right to the top. Even as the government subsidises petrol at a cost of around $2 billion a year, at least 10% of it (and perhaps more) is smuggled on to the international market. One of Mr Saleh’s former advisers allegedly used army vehicles to take the stuff to Saudi Arabia.

Corruption, the absence of properly enforced commercial law, poor security and a badly educated population have impeded business for Yemenis, scaring off most foreign investors. Mr Saleh was so preoccupied with securing his political base that he ignored economic development, appointing incompetent stooges rather than qualified technocrats to run projects such as a vaunted free-trade zone in the port of Aden, which has never taken off.

In any event the oil revenues that bolstered the government in the 1990s are disappearing fast, and reserves too. Mr Saleh’s patronage network has been torn apart as his power to pay off an increasingly resentful population has dwindled. Yemen has long looked to its big, rich neighbour, Saudi Arabia, to bail it out; 3m barrels of Saudi oil have arrived in Aden, which should ease things for a while. But Saudi resources and patience are limited. Aid workers fear that Yemen is too chaotic and geopolitically insignificant for large-scale aid and loans to come its way.

For years, it has been clear that Mr Saleh’s removal was a prerequisite for economic reform. Now that he is gone (although he may yet try to come back) Yemen is so utterly ruined that the upheaval following his departure is as likely to kill the economy as to cure it.

U.S. washes hands of Yemen's Saleh

WASHINGTON, July 21 (UPI) -- The only thing standing in the way of a peaceful political transition in Yemen is the country's president, an official at the U.S. State Department testified.

Yemeni President Ali Abdullah Saleh has clung to power despite mounting calls for his resignation. The Gulf Cooperation Council offered a proposal for his resignation in exchange for immunity, though he's refused to sign the deal.

Janet Sanderson, deputy assistant secretary of state for Near Eastern affairs, testified before lawmakers in Washington that the GCC initiative was the best option for peaceful transition in Yemen.

"The GCC initiative (was) signed by both the ruling General People's Congress Party and the opposition coalition Joint Meeting Parties," she said. "Only President Saleh is blocking the agreement moving forward and we continue to call on him to sign the initiative."

Saleh is recovering in Saudi Arabia from wounds suffered during a June 3 attack on his presidential compound.

Sanderson said U.S. policy in Yemen was centered on a stable and effectively governed Yemen.

"We will be able to more effectively engage in Yemen once the Yemeni government initiates the political transition and identifies its way forward," she said.

Yemeni Islamist leader survives assassination bid

Wednesday, July 20, 2011

By Ahmed Al-haj, Associated Press

SANAA, Yemen — An Islamist opposition party in Yemen says its leader has survived an assassination attempt by gunmen on his car in the nation's capital.

The Islah party says Mohammed Yadoumi was driving through Sanaa on Wednesday when the assailants opened fire on his vehicle, hitting it four times. Yadoumi escaped the attack unharmed.

The party blamed the regime of President Ali Abdullah Saleh for the attack. A government spokesman was not immediately available for comment.

Yadoumi's party is one of the most important opposition groups in Yemen and has been active in the more than five months of mass protests seeking to topple Saleh's regime.

British man killed in Yemen car bombing

By Fawaz al-Haidari (AFP) July 20, 2011

ADEN — A police official said a Briton was killed in a car bombing on Wednesday in the main southern Yemeni city of Aden, in an attack that an intelligence officer said carried the "fingerprints of Al-Qaeda."

The Briton, who was the head of a shipping company, was killed by a bomb in his car in the Moalla area near a hotel where his company has an office, the police official said.

The police officer did not comment on the motive of the attack but an intelligence officer told AFP: "The operation carries the fingerprints of Al-Qaeda."

Police did not let journalists approach the site of the blast.

Witness Abdullah al-Sharafi told AFP: "I heard the explosion, I hurried there and I found the car in pieces and a charred body."

Attacks are relatively rare in Aden, which remains generally calm despite deadly unrest in other southern provinces that have seen repeated clashes between suspected Al-Qaeda militants and security forces.

In neighbouring Abyan province, militants believed to be linked to Al-Qaeda took over much of the provincial capital Zinjibar in late May, and have been battling security forces ever since, displacing thousands of residents.

Aden was a British protectorate until 1967. It used to be one of the world's most important ports.

There have been a number of attacks against Western targets in Yemen, the most infamous of which was a waterborne suicide attack in 2000 against the warship USS Cole in Aden, in which 17 US sailors were killed and 38 wounded.

Britons have been targeted in more recent attacks, including on April 26, 2010, when the British ambassador to Yemen narrowly escaped being killed when a car bomb hit his convoy in Sanaa.

Then, on October 6 last year, a rocket-propelled grenade hit a British embassy car in Sanaa, wounding three people, including a diplomat.

Later the same month, two parcel bombs were discovered en route to the United States, one in Britain and the other in Dubai. Neither went off. The plot was claimed by Yemen-based Al-Qaeda in the Arabian Peninsula (AQAP).

Yemen is the ancestral homeland of veteran Al-Qaeda leader Osama bin Laden, who was killed in a US commando raid in Pakistan on May 2.

US commanders have repeatedly expressed concern that the jihadists have been taking advantage of a protracted power vacuum in Sanaa to expand their operations.

Protesters have since January been demanding the ouster of veteran President Ali Abdullah Saleh, who has been in hospital in Saudi Arabia since early June receiving treatment for wounds sustained in a blast at his palace.

He appeared on television on July 7 for the first time since the attack, heavily bandaged.

Three days later, he was shown on television receiving John Brennan, US President Barack Obama's top counter-terrorism adviser. He was in better shape than in his earlier appearance, although burns were still visible on his face.

Deputy Information Minister Abdo al-Janadi said on Saturday that Saleh will return home "soon" but the opposition has joined forces with rebels in both the north and the south of the country in a bid to block the veteran leader's resumption of power.

Analysis: Yemen's fuel mayhem to continue

By Humeyra Pamuk
DUBAI | Wed Jul 20, 2011
DUBAI (Reuters) - Fuel shortages in Yemen will persist even after its oil pipeline and main refinery recently restarted, because tanker-hijacking tribes and an emerging black market threaten fuel supply and add to the country's instability.
Yemen is only a small crude producer with a daily output of just 260,000 bpd of oil and modest liquefied natural gas sales.
But its location on the strategically important Bab al-Mandab strait, through which millions of barrels of oil and tonnes of other goods are shipped daily between Asia, Europe and the Americas, could make instability in Yemen a risk to global trade.
A mid-March attack by tribesmen on its main oil artery cut off crude to the 150,000 barrel per day Aden refinery, forcing it to shut, creating severe fuel shortages.
The poorest Arab country, already struggling to provide basic public services to the majority of the population, also lost export income and was forced to almost double its fuel imports when it could least afford to.
The quiet repair of the pipeline may have revived hopes that widespread fuel shortages will subside, but analysts say many other problems will continue to cause fuel shortages.
"We're now in the wild, wild west here," one Yemen-based Western shipping source said. "The repair of the pipeline will definitely solve some problems ... it will help the government with its finances. But the (poor) distribution of fuel, the black market -- those problems will remain."
The pipeline carries Maarib crude to the coast, where it is loaded on tankers for transport to the Aden refinery. The first shipment is expected to move later this week, shipping sources said.
But the real distribution challenge starts once the crude is refined.
"It's not as simple as the pipeline starting up and fuel being freely available," said Lucy Jones, Middle East analyst at risk consultancy Control Risk.
"Insecurity on the road to Aden means delivery to neighboring provinces remains extremely difficult; not only because you have actual fighting going on, but also because tribes are confiscating tankers or demanding lots of money to let them pass," she said.
CHAOS, CRISIS
Yemen has descended into chaos over the past six months as protestors have demanded the departure of its long-standing but increasingly unpopular president, Abdullah Ali Saleh.
The government has virtually been paralyzed since Saleh left for Saudi Arabia after an attack on the presidential compound. As he recovers from his injuries in Riyadh, the chaos has intensified in the political vacuum he has left behind.
"(Yemen) It's right next door to Saudi. It is sitting on the edge of a very important waterway," a Gulf-based trader who supplies fuel to the country said.
"I wouldn't want to think of a situation of tribes taking over the country.
The fuel crisis also has meant that many areas of the arid, mountainous country have gone without power for much of the day because of a lack of fuel for power plants, while water supplies to some regions have run dry.
The International Monetary Fund says Yemen's inflation rate may surge as much as 30 percent this year as the unrest and the damage to the oil pipeline have further strained the economy.
"The main problem was the fact that they were not getting income from oil exports, but also they were having to pay additional money for fuel," Control Risk's Jones said.
An injection of 3 million barrels of crude donated from Saudi Arabia allowed the Aden refinery to restart in June, but because the Saudi crude was not as light or low in sulfur as Yemen's Maarib oil, it did not yield anywhere near enough diesel and gasoline.
A senior government official said in late June that Yemen needed 4,000 tonnes of gasoline daily and was able to produce only 1,200 tonnes from the donated crude, forcing the cash-strapped government to continue imports.
On the burgeoning black market, gasoline and diesel are now sold at nine to 15 times the official price at established filling stations for the little fuel that can still be found, making life for the country's 23 million people, 40 percent of which live on less than $2 a day, even more difficult.
Gasoline, which was 75 Yemeni rials per liter before the crisis now is sold at 550-600 rials ($2.53-$2.76) on the black market, while the price for diesel has gone up to 1,000 rials from 60.
Fuel trucks feeding fuelling stations rely on armed guards for protection.
In early June, fuel shortages sparked violent clashes at petrol stations in several provinces, killing three people and injuring 12.

"After waiting in line for several days, I reached the front of the line at the petrol station at dawn Sunday. Suddenly there was a scuffle between some armed men who wanted to cut the line and the station workers, so the gunmen started shooting," Sanaa resident Mansour Ibrahim said.
"I didn't have any choice but to leave my car and flee, I was afraid I'd be killed, like others have."