In a new development, Saudi Arabia took a step late last month to support the Yemeni economy by launching a comprehensive economic, financial and monetary reform program, technically supervised by the Arab Monetary Fund. At a cost of one billion dollars, this reform program would cover the period 2022-2025.
This in turn represents a link in a long chain of Saudi support for Yemen, not only economically, but also politically, and at the security and military levels. This support is made in the face of the terrorist Houthi group and its allies, in an effort to restore stability and complete the constructive steps that had begun after the implementation of international resolutions and Gulf initiative plans.
In order to shed light on this Saudi initiative in support of the Yemeni economy, this report reviews the objectives and the significance of this step through three axes that reflect, in essence, the scope of the Saudi vision in its political, economic and developmentsupport for Yemen.
THE ECONOMIC REFORM PROGRAM:
The main objective of the reform program launched by the Kingdom to support the Yemeni economy continues to be represented by working to establish the foundations of its economic, financial and monetary stability, in addition to strengthening the state’s public finances and external position, rebuilding its institutions and enhancing its governance and transparency.
This is in addition to the program’s endeavor to achieve a number of sub-goals, the most prominent of which are the following:
- Promoting inclusive and sustainable economic growth and job creation, which leads to putting the Yemeni economy on a more sustainable path, advancing economic and social development, and reducing unemployment and poverty rates.
- Strengthening the financial position of the Yemeni government, developing the financial and banking sector, creating an enabling environment to enhance the role of the private sector, and involving it in the process of sustainable economic development.
In light of these main objectives, the program is launched through a package of economic reform priorities, including:
- Reforming the state's public finances, developing self-generated public resources, controlling and rationalizing government spending, enhancing its efficiency and governance, and directing it to urgent priorities.
- Rehabilitation of vital infrastructure in the electricity, water and roads sectors.
- In the financial and banking sector, the program seeks to work on developing the system of banking governance and supervision in a way that enhances transparency and accountability, enhances financial inclusion, in addition to supporting digital financial transformation.
- Developing the private sector so that it assumes its position as a main engine for comprehensive and sustainable economic growth and the creation of productive job opportunities.
The Saudi Program for the Development and Reconstruction of Yemen:
It is without exaggeration to say that it is very difficult to talk about Saudi support to Yemen without touching on one of the most important development programs in the world, as this program was established by royal order from King Salman bin Abdulaziz Al Saud in 2018 when he drew up a development strategy for the program.
Taking into consideration three aspects, the first is what serves the development plans and needs of Yemen. Second is the need for these plans to align with the global goals of sustainable development. Third is the need to take into account previous international experiences in development and reconstruction.
In this context, the program was implemented as a result of its signing by the Saudi and Yemeni governments according to a development agreement to work through three axes.
The first relates to technical content that aims to provide sustainable economic and development support in various fields for Yemen, with the aim of implementing development projects and programs that contribute to raising the level of basic services for the Yemeni people, providing job opportunities, developing infrastructure, contributing to building the capacities of Yemeni government institutions, raising the capacity of Yemeni society to absorb development loans and grants, and applying the highest standards of governance.
The second is related to the program's partnerships, as this program works with a group of diverse partners at all levels – local, regional and international, governmental and non-governmental.
The third is related to the regions and sectors of development and reconstruction, as the program operates in various Yemeni governorates, and in seven different vital development sectors, namely, health, education, transportation, energy, water, agriculture and fisheries, and government institutions.
In light of these three axes, during the past four years, from 2018 until November of this year, the program created more than 224 development projects and initiatives in 14 Yemeni governorates, with a total value of 917,217,200 dollars and a total number of beneficiaries reaching 14.6 million in the seven basic sectors, which made this program come fourth in the list of donor organizations to Yemen, which numbers 75 organizations.
It is worth noting that this program is one of other programs allocated by the Kingdom to support Yemen, as Yemen is the highest recipient of Saudi aid, with a value exceeding $20.3 billion.
Yemen and Economic Reform: A Hostage to Completing Political Process
Several reports fill the media space whether printed or online with what happened regarding the start of implementing the reform program which was subject to the contract between the Kingdom and the Yemeni government.
The Kingdom has been keen to establish peace in Yemen through its diplomacy, to open many regional and international doors in order to end the Yemeni crisis, while preserving at the same time the principle of non-interference in the domestic affairs of Yemen, as well as the principle of not abandoning the Yemeni people who suffer from the Houthi coup against the legitimate government.
It is the coup that thrust the Yemeni crisis into a dark tunnel after it had come close to reaching political understandings emphasizing the restoration of political security and stability in Yemen.
This is evidenced by the Kingdom's steadfast strategy regarding the Yemeni crisis, which provides that the solution to the Yemeni crisis must be political, through agreements and understandings that bring together the Yemeni people on a national vision far from external dictates.
The Kingdom has upheld its steadfast strategy which has not been altered even with the change of international envoys.
In Yemen, the Kingdom has maintained its extensive efforts to facilitate their tasks by dealing positively with their proposals aimed at restoring security and stability to the Yemeni state, which includes the various Yemeni factions, regardless of religious, sectarian, ethnic, or regional distinctions. This is the focal point of Saudi policy towards Yemen.
The Kingdom believes that politics and development are two inseparable and complementary processes, and realizes that the required economic reforms and development efforts will not bear the desired fruits for the Yemeni people if the Houthi group continues its political practices, military violations and terrorism.
This requires the international community to realize the fact that it is of great importance to exert more pressure on this group and its regional supporter by sitting at the negotiating table and adhering to the agreements that are made. Such agreements are preferable to maintaining a coup policy and returning to a zero point, which wastes all the development and humanitarian efforts on which the Kingdom is keen in its policy with the Yemeni people.
In sum, the commitment of the Yemeni government to the comprehensive economic reform program, which is assisted in its implementation by the Arab Monetary Fund, represents a major pillar for it in its direction towards resolving the daily living crises that the Yemeni citizen suffers.
It behooves Yemen to conclude such development programs not only with the Kingdom, but also with various international and regional donors, as such cooperative programs aim to support efforts to reform the Yemeni economy with the aim of restoring the Yemeni state to the role and position it deserves.
