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The Well Runs Dry

The Yemeni state is unstable, foreign investment is minimal, and the country's water table and oil reserves are depleting rapidly, all of which is causing the state's already limited power to recede further back into major urban areas.

by Christopher Boucek and Gregory D. D. Johnsen
published by
Foreign Policy
 on February 5, 2009

Source: Foreign Policy

Yemen is invariably referred to as the "land of faith and wisdom" in jihadi journals and videos, echoing a famous saying of the prophet Mohammed. But what was true 1,400 years ago rings more than a little hollow today. Few in the West have much faith in the continued stability of the Yemeni state or see wisdom in investing in an opaque economy plagued by rampant and systematic corruption. These concerns, combined with the rapid depletion of Yemen's water table and its oil reserves, are causing the state's already limited power to recede further back into major urban areas.

Meanwhile, the rural and tribal areas of the country, many of which have long been beyond the full reach of the government, are gaining increasing autonomy -- opening up space for al Qaeda to regroup and use the country's undergoverned regions as a staging area for attacks throughout the Arabian Peninsula and the Horn of Africa. It's not hard to imagine Yemen ultimately looking a lot more like chaotic Somalia, its neighbor across the Gulf of Aden.

The security situation in Yemen is steadily worsening. In February 2006, 23 al Qaeda prisoners tunneled out of a political security prison and into a neighboring mosque, where they walked out the front door to freedom. Among the escapees was Nasir al-Wahayshi, a former secretary to Osama bin Laden who fought in the battle at Tora Bora before escaping to Iran, where he was eventually arrested and extradited to Yemen.

At the time of the prison break, al Qaeda's Yemen branch had been largely eliminated. But the past three years of violence have underscored the dangers of lapsed vigilance, illustrating what can happen when highly experienced and motivated fighters return to the battlefield. This is surely a concern for U.S. officials as they debate what to do with the 99 Yemenis being held at Guantánamo Bay. Although some appear to be innocent, separating them from the guilty has proven to be an overwhelming task for U.S. investigators.

Wahayshi, along with fellow escapee Qasim al-Raymi, have spent the years since their escape rebuilding and restructuring an al Qaeda network in Yemen that is designed to survive the loss of key commanders. Once a durable infrastructure was established, their ambitions grew and they looked to expand and upgrade their local al Qaeda chapter into a regional franchise. This took place in mid-January, when the Saudi and Yemeni branches of al Qaeda combined forces under Wahayshi's command. But as dangerous as al Qaeda is, in the Yemeni government's calculations it does not represent an existential threat to the survival of the regime in the same way as the religious revolt in the north and talk of secession in the south do.

The northern revolt began in June 2004, when the Yemeni government overreached and tried to arrest a former member of parliament, following years of confrontations and government support for transplanted Wahhabi extremists against a local community of Shiites known as Zaydis. The fighting has been centered in the mountainous northern governorate of Sadah, and the Zaydis' Shiite identity has led to claims that Iran is meddling on Saudi Arabia's southern border, drawing the attention of Saudi and U.S. security officials. But despite Yemeni allegations to that effect, no firm evidence has come out. The war is on hold, following a secret deal between the president and the rebel leader, which is likely to last only until parliamentary elections are held later this year.

Nationwide elections were originally scheduled for April, but threats of a boycott and backroom negotiations could postpone them six months. Further complicating matters are muttered threats of secession and popular protests organized by some in the Yemeni Socialist Party. Despite the party's relatively weak power base, the government takes these threats seriously. It recently put 160 Islamist militants in the southern governorate of Abyan on its payroll, which many southerners see as a replay of the early 1990s, when scores of socialist leaders were assassinated in the buildup to the 1994 civil war.

As if these political and security problems were not enough, Yemen's chronic economic, demographic, natural resource, and human development challenges are only growing worse with each passing year. Most critically, the state's oil reserves are almost tapped out. Yemen is a very modest oil producer, yet it generates approximately 80 percent of its income from oil exports. As of 2003, the country was exporting more than 450,000 barrels per day, but Minister of Oil Amir Salem al-Aidroos warns that exports had fallen to roughly 280,000 barrels per day by January 2009. Barring any major discoveries (and none are expected), Yemen will likely run out of exportable oil within the next decade.

This is not merely an economic issue. The Yemeni government relies on the hard currency generated by oil exports to fund the state and lubricate the extensive patronage systems that tie the country together. For the past several years, record global crude prices had masked the reality of Yemen's declining export capacity, allowing the government to ignore the impending reckoning. The country now exports fewer barrels of oil per day and earns significantly less income per barrel -- almost $100 less than it did only six months ago. The resulting nose dive in government revenues has forced several budget revisions and led the Ministry of Finance to order budget cuts of 50 percent throughout the entire bureaucracy, further underscoring how serious the government is taking threats of southern secession. The economic crisis will likely hit Yemen hardest at just about the time that President Ali Abdullah Saleh will be forced to step down as the unified country's first and only president -- leaving a power vacuum in his wake.

Yemen has done little planning for a post-petroleum economy, and most analysts doubt state expectations that natural gas will be able to fill the void left by oil. In a best-case scenario, if natural gas exports come online in significant quantities, there will still be a lag between the end of oil and the rise of gas. It is not at all clear how the country will deal with this inevitable gap.

Of even greater concern, perhaps, is the fact that the country is rapidly running out of water. Groundwater used for agriculture and basic human needs is being consumed faster than it can be replaced, resulting in dramatically falling water tables -- up to several meters per year in some places. Sanaa might very well become the first capital in the world to run out of water. Natural aquifers are being depleted at astounding rates due to a lack of any serious legal oversight, reckless irrigation techniques, and unregulated private exploitation.

India, with more than 50 times the population, has fewer than one eighth as many private water-drilling rigs. Nearly all Yemen's arable land is devoted to cultivating khat, a seminarcotic plant whose leaves are habitually chewed by most male Yemenis. The more water khat is given, the more it thrives, leading many farmers to irrigate with little thought to the consequences. Given the costs and terrain involved, desalination is not feasible. In the absence of significant measures to reduce urban population growth and eliminate the hidden subsidies that encourage unlimited private exploitation of the country's water, Yemen's future looks extremely bleak.

Exacerbating all these trends are the country's demographics. Yemen has one of the highest population growth rates in the world, at just under 3.5 percent. The current population is expected to double to more than 40 million within two decades. The delivery of basic government services is hampered by the fact that the population is spread throughout 135,000 villages, with many located in isolated areas. Education and healthcare services are limited for most, as is reliable electricity and other services. Most Yemenis outside major urban areas receive little from the central government, and as a result the regime's authority and presence in the governorates is largely absent.

Yemen has long had a reputation among outside observers of stumbling from one crisis to the next without ever completely collapsing, but much of what appeared to be blind luck was calculated governance fueled by petrodollars. When the well runs dry, that luck may run out as well.

Gregory D. Johnsen is a Ph.D. candidate in Near Eastern studies at Princeton University.

Carnegie does not take institutional positions on public policy issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of Carnegie, its staff, or its trustees.