The Iran Nuclear Deal and Yemen’s War: An Opportunity for EU Statecraft

The Iran Nuclear Deal and Yemen’s War: An Opportunity for EU Statecraft

By Farea al-Muslimi


As the foreign military intervention in Yemen approaches its fourth year, world events have come together to create a rare window of opportunity to bring the conflict to an end. This, however, will require a powerful global actor to sheppard the process, and the European Union is currently the most well-positioned to take up the role.    

The killing of journalist Jamal Khashoggi at the Saudi consulate in Istanbul in October has brought global attention to focus on the conduct of Riyadh’s rulers, and in particular the Saudi-led military intervention in Yemen. The internationally recognized Yemeni government, supported by a coalition of Arab states with Saudi Arabia at the helm, are mired in a veritable stalemate with the armed Houthi movement, which took control of the capital Sana’a in 2014. The toll of the conflict has been shouldered chiefly by civilians, unleashing the world’s gravest humanitarian emergency and pushing the country toward what the United Nations predicts could be the “worst famine in living memory.” Successive attempts at peace talks have failed and over two years have passed since the warring parties last sat down together at the negotiating table.

Despite this apparent reticence to engage in efforts to find a political solution, the parties to this seemingly intractable conflict are in fact all seeking a route out. They cannot do so however, without a means to save face. The United States’ exit from the Iran nuclear deal this year has offered the opportunity for exactly this. With Washington’s withdrawal and reimposition of economic sanctions, Saudi Arabia – desperate to walk away from a war that is proving increasingly costly in both reputation and treasure – can claim a victory over its archrival Iran, at a time when its forces also have an upper hand militarily in Yemen. On the other side, Tehran is seeking to forge closer ties with Europe to counterbalance to its souring relationship with Washington. While their ties are often mischaracterized, Iran is the only state actor with the ear of Houthis and can be expected to calculate – given the peripheral importance of Yemen’s war for its national interests – that collaboration with Europe to end the war could be an astute move.

The European Union appears to be the only actor that can capitalise on this brief alignment of interests. The US has lost any remaining semblance of an impartial actor in the region and the United Nations’ Security Council is hamstrung by fault lines over the war. EU action would need to be complementary to the ongoing mediation efforts by the UN Special Envoy to Yemen, Martin Griffiths, lending its clout, legitimacy and resources in a guarantor-type role. Crucially, the union is held in regard by the conflict’s most powerful player, Saudi Arabia, and its leading member states are already in talks with Tehran over the future of the nuclear deal. An activation of these channels within the small window that has presented itself would act as a force-multiplier to UN-led efforts to find a political solution to Yemen’s war.  

The Iran Deal for the Yemen War

While the signing of the Iran nuclear framework in 2015 was a watershed moment for global diplomacy and a foreign policy legacy marker for United States President Barack Obama, little mentioned at the time was the price of the deal: the war in Yemen.

Saudi Arabia was incensed with the Obama administration for signing up to the Joint Comprehensive Plan of Action (JCPOA) – which granted Iran sanctions relief in return for capping and accepting international monitoring of its uranium enrichment program — as Riyadh saw the deal bolstering its arch-enemy across the Persian Gulf. The Houthi military expansion in Yemen through 2014 and early 2015 then only fuelled Riyadh’s paranoia that an emboldened Tehran was establishing a forward operating base on Saudi Arabia’s southern doorstep.

To placate these fears and to stop Riyadh from scuttling the JCPOA, Obama essentially wrote Saudi Arabia and its allies a blank cheque for a military intervention in Yemen. The Obama administration, supported by the United Kingdom, provided the Saudi-led military coalition with warships to help enforce a sea blockade of Yemeni ports, air refuelling support for coalition warplanes, and military and intelligence personnel for the coalition’s military command complex in Riyadh. It also expedited sales of advanced weapons to the Saudi and Emirati militaries, and regularly blocked moves at the United Nations to censure or condemn the coalition as civilian casualties in Yemen mounted, the country’s economy collapsed and millions of people were driven toward famine. While it has become fashionable today for US Democrats to berate Obama’s successor for the free hand he gives the Saudis, what they fail to mention is that the Obama administration was essential to starting and supporting this disastrous Saudi-led military adventure in Yemen.

A War of Attrition and Strained Alliances

The Saudi-led military coalition officially launched its campaign to push back Houthi forces and reinstall the internationally recognized Yemeni government in the capital, Sana’a, on March 26, 2015. The effort, dubbed ‘Operation Decisive Storm’, has been anything but. While seeing some early successes through the summer of 2015 in pushing Houthi fighters out of the port city of Aden and southern governorates, in the three years since the conflict has largely been a grizzly stalemate. The country as a whole has descended into the world’s largest humanitarian crisis, while some estimates peg the cost of the war to Saudi Arabia alone at up to $6 billion per month.    

If one can ever say there is a honeymoon period in a war, it is now definitively over in Yemen. From a conflict resolution standpoint, this means a window of opportunity. Indeed, the belligerent parties today seem, in many ways, more tired of their allies than they are of their enemies. Throughout 2017, spates of violence regularly broke out between troops loyal to Yemeni President Abdo Rabbu Mansour Hadi and United Arab Emirate-backed paramilitary forces in Yemen. In early 2018, clashes engulfed Aden, the Yemeni government’s functional capital in the country, when forces affiliated with the UAE-backed separatist Southern Transitional Council (STC) routed government troops from the city. While Hadi has since intermittently returned to Aden, tensions have continued to simmer amid growing protests over the country’s economic crisis, culminating in a call from the STC for a popular uprising against the government in October.

It is also little secret that both UAE and Saudi officials view President Hadi with contempt, seeing him as a corrupt statesman and an impotent leader with little natural constituency in Yemen. Meanwhile, the Gulf monarchies have faced increasing international criticism and damage to their reputations over mounting evidence of war crimes. This bad press – such as the August 9 coalition airstrike on a school bus in Sa’ada governorate that killed 40 children – has seen opposition to the coalition intervention gain momentum in Europe, the US and at the UN. Khashoggi’s murder has only bolstered the conception of Saudi Arabia as a reckless actor in the region.        

The coalition’s current campaign along Yemen’s Red Sea coast to take Houthi-held Hudaydah city, launched in June this year, has displaced nearly half a million people. Even the coalition’s staunchest allies – including congressional leaders in Washington – have warned that the campaign will likely fail to achieve its goals while simultaneously unleashing a cascading humanitarian fallout. Hudaydah port is Yemen’s busiest and the entry point for most of the country’s commercial and humanitarian supplies. Interruptions in cargo ship deliveries would threaten to catapult millions of people into famine.

While the coalition announced a “pause” in the offensive in June – officially to allow time for the UN Special Envoy for Yemen to pursue conflict de-escalation efforts – the first days of November saw the coalition renew the offensive. A coalition victory would landlock the Houthis, though in the process likely instigate mass starvation on a scale unseen in modern times, and without necessarily precipitating an end to the conflict given Houthi forces’ demonstrated capacity for protracted guerilla warfare.

That said, however poor the outlook for the coalition, the Houthis are faring worse. In late 2017, their alliance with former President Ali Abdullah Saleh ruptured, leading to clashes in Sana’a in which Saleh was killed. While Houthi forces now exert more authority in territories they previously co-governed with Saleh, intelligence leaks from Saleh’s former networks have led to the assassination of high-ranking Houthi military and political figures.

Saleh and his General People’s Congress party had also maintained extensive diplomatic networks, which provided a valuable link between the Houthis and the West. The loss of these left the Houthi leadership feeling deeply isolated, with Tehran to only remaining option to carry their voice internationally. On the ground, the Houthis have been slowly losing territory for more than a year, and while their ballistic missile launches into Saudi territory or attacks on Red Sea shipping may be headline-grabbing, militarily they are insignificant. Increasingly oppressive governance in territory under Houthi control betrays the extent to which the leadership in Sana’a are feeling the heat. The war for the Houthis has become a test of how much continual punishment they can endure – not just along the frontlines but from relentless coalition bombing across northern Yemen.

All parties to the conflict are exhausted and looking for a way out. And yet, lugged along by the conflict’s momentum, the belligerents stand at the crossroads of an even more terrible phase of the war. It is in such moments, however, that the opportunity for a peace broker to intercede appears.  

Opportunities in Trump’s Belligerence Towards Iran

Successful conflict resolution requires that, in silencing the guns, the belligerent parties are able to save face. Whether or not a party to the conflict actually won is less important than whether that party is able to maintain the appearance of victory.

In President Trump’s withdrawing from the JCPOA and targeting Iran with new sanctions, the Saudis have in a sense already won, at least in terms of the zero-sum cold war the kingdom sees itself as waging with Iran. From this perspective, the victory Tehran achieved in securing the nuclear deal has become a defeat. Riyadh can now proffer the narrative that it has regained the initiative against its arch foe and the impetus for launching the military intervention in Yemen has receded. Whatever the  impact on future Saudi policy choices, the UAE — which entered the Yemen conflict out of solidarity with Riyadh — will follow.

Coalition-backed forces have quickly swept up Yemen’s western coast and made advances from the Saudi border into the Houthi heartland of Sa’ada governorate. Such gains, while still far from a decisive military victory, have given the coalition the initiative and would allow Riyadh and Abu Dhabi to enter peace negotiations from a position of strength – the only position that would be palatable to Saudi Crown Prince Mohammad bin Salman, widely seen as the architect of the coalition intervention in Yemen. International pressure following the killing of Khashoggi at the kingdom’s consulate in Istanbul in October may also make the conditions more amenable to a political solution. While Riyadh fervently denies allegations of a state-sanctioned operation, concrete signals of its commitment to a peaceful resolution to the Yemen war would help rehabilitate the kingdom’s beleaguered public image.

Across the Gulf, the JCPOA and the reelection of pragmatist President Hassan Rouhani in 2017 enabled a gradual, modest economic opening and took Iran out of its international isolation, boosting diplomatic relations with Western countries. Among the headline-grabbing deals following the JCPOA’s signing were the nearly $40 billion in aircraft sales with US-based Boeing and France-based Airbus, and a 20-year, five billion-dollar contract with French oil and gas major Total and China’s state-owned CNPC to develop phase 11 of Iran’s South Pars gas field.

With the US withdrawal from the JCPOA in May this year – and many multinational companies’ subsequently cancelling newly inked deals with Tehran – Iran’s hopes for an economic lift fell to earth. While hardliners in Tehran have since trumpetted that the US cannot be trusted and issued bellicose dictates directed at Washington, the government has signalled that it seeks to keep as much of the JCPOA alive as possible. With inflation soaring, the currency tanking and socioeconomic protests rattling the country, Iran can hardly afford going back to complete isolation and sanctions. Leaders from the UK, France, Germany and the European Union — all signatories to the JCPOA — have in public and behind the scenes shown their intent to try and uphold the deal as well, in spite of US threats to sanction European businesses doing trade with Iran.

Since the US re-imposed sanctions on Iran on November 5, Europe has stepped up efforts to establish a clearing house designed to circumvent the US-dominated banking system and enable firms to continue conducting business with Iran. While its details remain vague and feasibility dubious, such moves illustrate Europe’s calculation that the JCPOA must be somehow preserved and Tehran kept on side.

At the same time, while Iran has regularly offered public support for the Houthis in Yemen, it has actually invested little of its political, military or economic capital in the conflict. This is unlike Iraq, Syria and southern Lebanon, which Tehran views as crucial to its geopolitical positioning and security, and thus in which it has invested heavily to maintain its interests. The Houthis have been incredibly convenient for bleeding Saudi Arabia of treasure and reputation and the Iranians have in return been happy to offer piecemeal support as the opportunities have presented themselves. However, in the unlikely circumstance that Houthi forces folded tomorrow and the coalition “won,” Tehran would lose little. Indeed, Houthi officials make no secret of their viewpoint that, given the right assurances, they would be open to being long-term strategic partners with Saudi Arabia in Yemen.

This is where the opportunity arises to set the conditions for conflict resolution in Yemen: Riyadh’s ability to save face and Tehran’s desire to forge deeper ties with Europe open the door to effectively neutralizing the regional drivers of the Yemen conflict.

Why the US is Unable, and UN Insufficient, to Facilitate Peace in Yemen

It is widely agreed that there is no military solution to the Yemen conflict, only a political one. Among the world powers however, the US is not in a position to play the role of peace broker in Yemen. With a series of inflammatory moves in the region, including the withdrawal from the Iran deal and recognition of Jerusalem as Israel’s capital, Washington has lost under the Trump presidency what had arguably been its greatest capital in the Middle East: the assumption — valid or not — that it could be part of the solution.  

While the US has rarely been viewed as an impartial regional meditator, there has existed an implicit regard for the potential for American dynamism. This facilitated previous historic Washington-led diplomatic efforts in the region — among them the Camp David and Oslo Accords — whether or not these agreements met their stated goals, or were practical to begin with. Today, there is no longer the illusion of depth or altruism in US foreign policy. Neither is there much regard for Washington’s resolve to the hold to the commitments it makes.   

The United Nations also faces a crisis of credibility in Yemen. Jamal Benomar, the UN Secretary-General’s first Special Envoy for Yemen following the 2011 uprising, oversaw the country’s transitional phase, and its dissolution. While officially a mediator and facilitator between political parties, Benomar was widely seen as going beyond this role to become a central figure in decision making himself – a position from which he increasingly provided political cover for President Hadi as the latter’s failures as transitional head-of-state mounted. Benomar resigned shortly after the Saudi-led military coalition launched its initial foray to dislodge Houthi forces from Aden in March 2015. He was replaced by Ismail Ould Cheikh Ahmed, who over his tenure oversaw three rounds of failed peace talks and was banned from Houthi-held areas for the last year at his post due to accusations of bias. Meanwhile, as the war and economic crisis drove millions of Yemenis toward starvation and their country into ruin, the UN Security Council remained virtually silent – at one point going more than 14 months without issuing a council decision related to the conflict.

This is not to discount the efforts of Martin Griffiths, who took over as the new UN Special Envoy for Yemen in March 2018 and since has engaged with and been well received by all relevant stakeholders to the conflict. The cancellation of peace consultations between the warring parties in September, which were scuppered at the eleventh hour, owed to a logistical dispute over the Houthi delegation’s transportation to and from Geneva and did not represent a terminal blow to Griffith’s mediation efforts. However, as Griffiths himself said to UN Security Council member states during his first council briefing on April 17: “Mediation without the backing of diplomacy will fail. We will do whatever we can to find agreements that work between Yemenis. But it is for the members of this Council, and other Member States, from time to time, to put the force of international opinion behind these agreements. Your unity and your resolve will be decisive.”

Plainly speaking, the UNSC is far from united regarding Yemen. Indeed, as in Syria, Ukraine, Palestine and Israel, the war in Yemen has made it painfully apparent that permanent UNSC member states prioritize their vested geopolitical interests over international harmony and conflict resolution, regardless of the humanitarian cost. Specifically, the US and UK have an established track record of defending the position of the Saudi-led military coalition in Yemen-related UNSC discussions and decisions. As Griffiths said during his April briefing, successful peace negotiations will require compromises from all sides; however, it is likely that the US and UK will derail any process which Riyadh finds objectionable. Regardless of Griffiths’ mediation skills, any UN-led process will ultimately be held hostage to the conflict’s most powerful player: Saudi Arabia. Diplomatic backing for mediation thus requires a powerful international player that is also able to act independently of the belligerent parties’ vested interests.   

The Opportunity and Imperative for Europe to Step Up  

Talks between Iran, the UK, France and Germany regarding the Yemen conflict have been underway since February, with all sides noting progress and an Iranian willingness to facilitate talks with or regarding the Houthis. The European and Iranian delegations said following the most recent meeting in September that talks would continue. The Europeans have multiple motivations for pursuing this track. There are Europe-Iran business interests, while limited, that relate to the JCPOA and which the Europeans have an interest in maintaining. More importantly, it is a security interest for Europe to preserve the dialogue with Iran that was institutionalized by the JCPOA. Through this dialogue Europe has an avenue to push for wider de-escalation, and specifically de-escalating Saudi-Iranian rivalry that has been rapidly destabilizing much of the Middle East since the Arab Spring uprisings upended the regional status quo in 2011. Since then, waves of refugees and sporadic terrorist attacks across Europe have helped inflame latent nationalist populist movements that are now threatening the EU’s very unity. A stable Middle East would help remove much tinder from this fire, with a Saudi-Iranian de-escalation being key to regional stabilization. And of all the region’s conflict’s, the Yemen war is perhaps where the EU is best positioned to helped end the violence.  

Until recently, Antonia Calvo-Puerta, head of the EU delegation to Yemen, was the only Western diplomat to have been granted an audience with the Houthi leadership. Indeed, the only other Western diplomat granted access to Houthi leader Abdulmalik al-Houthi in recent years has been Griffiths. Calvo-Puerta has also led the EU’s Track II efforts involving tribal leaders from across Yemen. This saw more than 30 tribal leaders flown to Belgium for talks in September 2017, with another meeting with tribal leaders held during the EU delegation’s visit to Sana’a earlier this year.

Brussels’ ability to step up its engagement in the Yemen conflict has in many ways been freed up by London’s imminent departure from the union. As a diplomatic and military ally of Saudi Arabia, the UK would have been able to curtail deeper EU engagement in the Yemen conflict had it maintained its voting power. The importance of the EU’s relative independence from the conflict’s belligerent parties thus becomes apparent. Despite the Saudi leadership’s disagreements with the EU their continued regard for Brussels is apparent. Criticism of coalition actions in Yemen has been audible in many European capitals, and in the EU parliament itself, while the Saudi response to such has been relatively muted. Compare this to Riyadh’s scorched-earth response toward Ottawa in August after the Canadian embassy in Saudi Arabia issued a tweet calling for the release of imprisoned Saudi civil rights activists.    

However, the EU’s real geopolitical and diplomatic potential to contribute to conflict resolution in Yemen will only come to bear when it becomes official EU policy. This requires EU High Representative for Foreign Affairs and Security Policy, Federica Mogherini, to be willing to leverage the current circumstances to help champion the process, in collaboration with the UN Special Envoy. Should Iran’s support for a peace process in Yemen be packaged into the Europeans’ discussions for maintaining the JCPOA, the choice for Tehran would be obvious. Yemen is the most peripheral arena for Iran, important only as a card in the game; if Tehran saw benefit coming from playing that card, it would do so. Riyadh, meanwhile, could use the EU as cover to finally end its disastrous military intervention in Yemen with a veneer of victory.  

In addition to coordinating with tribal factions in Yemen, the EU could also bring its weight to bear in support of the UN Special Envoy’s mediation efforts relating to Hudaydah port and Sana’a International Airport. Both are essential to the humanitarian relief effort and restarting normal economic activity, and in both cases it is Houthi control of these transport hubs that has the coalition either seeking their capture (in the case of Hudaydah port) or forcing their closure (in the case of Sana’a airport). The EU, with its experience in South Sudan, the Balkans, Serbia, and elsewhere, has demonstrated that it has the human and financial resources necessary to effectively oversee this type of major infrastructure in unstable environments. Relative to the UN, it has fewer bureaucratic obstacles to deploying the necessary manpower and finances, and most importantly the EU has enough credibility with both the Houthis and the Saudi-led coalition to take up this role. Another area for EU intervention would be in helping, via its connections with tribal networks, to arrange for prisoner exchanges and the release of journalists, activists and other civilians held by the various parties. This should be part of larger UN de-escalation and demobilization efforts.

All of the above should be seen as confidence-building measures between the warring parties en route to a final peace agreement, with the EU’s efforts dovetailing with, and supporting of, the UN Special Envoy’s mediation. Where Griffiths can lay out the roadmap and bring internationally legitimacy to the peace process, the EU can bring the clout and leverage necessary to act as a  guarantor, keeping the belligerent parties to their commitments on the ground and facilitating the de-escalation of hostilities.

Why the Moment is of the Essence

With all parties to the conflict searching for an exit route, now is the moment for the EU to champion peace in Yemen. The Khashoggi affair has also refocused world attention Saudi conduct, with even the US and UK now demanding that Riyadh’s end the war – the recent US move to end in-flight refueling for Saudi warplanes was a welcome step in this regard.

Through its access to the warring parties and legitimacy in the eyes of major stakeholders, Brussels is almost uniquely placed to play this role in the absence of alternative peace brokers. Leveraging Iran as the only remaining state actor with clout among the Houthis will be imperative to this effort. Already, regional security matters have been packaged in with talks to save the JCPOA, and Yemen’s war is the most likely front on which Tehran would show flexibility.

Yet here too, time is of the essence: for the moment, Iran says it remains willing to engage with Europe as counterweight to Washington’s punitive moves, but reformist voices advocating such a position will face further domestic pressure as sanctions start to bite. In August, Iran’s parliament impeached Masoud Karbasian, the country’s finance minister, citing the economic crisis that earlier this year spurred the country’s biggest protests since 2012. The supreme leader, Ayatollah Ali Khamenei — in whose hands political power in the Islamic Republic ultimately lies — has laid the blame for these economic woes firmly at Rouhani’s door and cast doubt on Europe’s ability to save the nuclear deal. France’s Total has already pulled out of the South Pars project and even if Europe establishes a mechanism to bypass the US banking system, businesses will still be wary of falling foul of new sanctions.

Most indicative of this urgency however, is the situation on the ground in Yemen. After more than three years of blood, disease and hunger, the renewed offensive on Hudaydah city and looming famine risks tipping the conflict in a new, even more devastating phase.

Farea al-Muslimi is chairman and co-founder of Sanaa Center for Strategic Studies.

About the Sana’a Center

The Sana’a Center for Strategic Studies is an independent think-tank that seeks to foster change through knowledge production with a focus on Yemen and the surrounding region. The Center’s publications and programs, offered in both Arabic and English, cover political, social, economic and security related developments, aiming to impact policy locally, regionally, and internationally.

This report was edited by Holly Topham and Spencer Osberg

The Yemen Review – October 2018

The Yemen Review – October 2018

Executive Summary:

In October, the United Nations warned that Yemen could become the worst famine the world has seen in a century, with some 14 million people – half the population – facing starvation. This crisis is primarily due to the collapsing value of the Yemeni rial: Yemen is overwhelmingly dependent on imports to feed itself and the rial’s depreciation has thus made foodstuffs vastly more expensive.

The murder of Saudi journalist and Washington Post columnist Jamal Khashoggi at the Saudi consulate in Istanbul grabbed world headlines throughout the month. This in turn focused world attention on Riyadh’s role in the Yemen war, led the United States and the United Kingdom to call for a ceasefire, and prompted many Western governments to reconsider weapons sales to Saudi Arabia.

Following a build-up of anti-Houthi forces towards the end of October on the outskirts of the Houthi-held Red Sea city of Hudaydah – a crucial entry point of commercial and humanitarian goods for Yemen’s largest population centers – the battle for the city reignited in earnest at the beginning of November.  

Yemeni President Abdo Rabbu Mansour Hadi fired Prime Minister Ahmed bin Dagher on October 15 and launched an investigation against him for corruption and negligence. Bin Dagher had held the post since the spring of 2016 and was replaced by Maeen Abdelmalek Saeed, who was until then the Minister of Public Works and Roads.

A report from Buzzfeed News documented how the United Arab Emirates had paid US mercenaries to assassinate its political opponents in Yemen, primarily individuals associated with the Islah party in the southern Yemeni city of Aden.   

The internationally recognized Yemeni government’s Economic Committee implemented new fuel import regulations, which would disqualify many Houthi-affiliated traders from importing fuel. The Houthi authorities in Sana’a subsequently threatened the senior staff of Yemen’s commercial banks – almost all of which are headquartered in Sana’a – with imprisonment if they complied with the Economic Committee’s decrees. These developments – along with the Houthi authorities appointing new senior staff to the Sana’a-based branch of the central bank – have likely escalated the war’s economic and financial ramifications for the Yemeni population.

Cyclone Luban made landfall in Yemen’s eastern Mahra governorate (picture above), with the UN estimating that 2,200 families were displaced by the storm.

Meanwhile, the Islah party continued to consolidate political and military control in Taiz City, a development that began in August and one that threatens to complicate future conflict resolution efforts.

The Sana’a Center Editorial

Islah’s Political and Military Ascent in Taiz

Since August 2018, the Yemeni Congregation for Reform, otherwise known as the Islah party, has taken major steps towards consolidating political and military power in Taiz City. Islah officially supports the internationally-recognized Yemeni government of President Abdo Rabbu Mansour Hadi; however, the party’s increasing capacity to act independently in Taiz represents a further erosion of the state’s purview within areas the government supposedly controls. Islah’s rise in Taiz, if solidified, is likely to complicate United Nations-led efforts to secure a peace agreement between the Houthi leadership and the internationally-recognized Yemeni government. It also threatens potential post-conflict efforts to stabilize the country’s political and security environments and establish effective state sovereignty.   

With the escalation of the ongoing conflict in March 2015, Taiz City and the wider governorate have been an epicenter of violence, with Houthi fighters continually clashing with various anti-Houthi forces. Within the anti-Houthi coalition in Taiz City, Islah-affiliated forces and the Salafi-oriented Abu al-Abbas Brigades have also had long-running tensions and periodic clashes. Among the former’s most prominent backers are Yemeni Vice President Ali Mohsen al-Ahmar and President Hadi’s chief of staff Abdulla al-Alimi; while the Abu al-Abbas Brigades are supported by the United Arab Emirates (UAE).

On August 8, 2018, intense clashes between Islah-affiliated groups and the Abu al-Abbas Brigades erupted, prompting President Hadi to hold an emergency meeting with Governor of Taiz Amin Mahmoud. Following this, Hadi announced the creation of a presidential committee to end the violence. The presidential committee, however, was dominated by Islah figures. Most prominent among these, and the committee chair is Abdu Farhan Salem, commonly referred to as “Salem.” He is arguably the most important Islah-affiliated military official in Taiz, as an advisor to the commander of the Taiz Military Axis, Khaled Fadl – also an Islah figure.

The presidential committee brokered a deal in which both the Abu al-Abbas Brigades and Islah-affiliated national army units and militias agreed to withdraw from positions within Taiz City. On August 18, the committee reported that all positions had been handed over to the Presidential Guard. However, by month’s end it was clear that while Abu al-Abbas’ forces had withdrawn, Islah-affiliated forces remained.

In September, Governor Mahmoud publicly thanked the presidential committee for its efforts before asking that it be dissolved, having seemingly fulfilled its mandate. The committee refused, insisting that, having been established through a presidential decree, another presidential decree was required for it to be dissolved. To date, President Hadi has not issued such a decree.  

In the meantime, Islah affiliates have leveraged the committee’s apparent authority to assert control over the official security apparatuses in Taiz that had technically been under the governor’s jurisdiction. Within these institutions, Islah has dismissed officials considered unloyal to it while promoting Islah affiliates. The committee has also facilitated the withdrawal of other anti-Houthi forces from areas around Taiz, in place of whom Islah-affiliated forces have moved in. Aiding Islah’s expanding clout in Taiz are the group’s strong grassroots support, local business ties, and loyalists in senior military positions. Currently, the largest anti-Houthi force unaffiliated with Islah still present in Taiz City is the Yemeni army’s 35th Armoured Brigade, which has worked closely with the Abu al-Abbas Brigades and is backed by the UAE.

Islah’s rapid ascent is allowing it, a non-state actor, to increasingly consolidate its authority in Taiz and be able to assert its own control independently from the internationally-recognized Yemeni government. Meanwhile, it also appears that Islah is coordinating efforts to have the current governor replaced with someone more amenable to the party.

The creation of another statelette within Yemen, however, is not inevitable. There are practical steps that local, regional and international stakeholders can take to head off this potential scenario. First, President Hadi must issue a decree officially disbanding the presidential committee. Second, he can order the removal of officers from Taiz’ military and security apparatuses who were appointed based on their political affiliations. Third, he can institute measures to increase the professional standards within, and decrease the ideological character of, the security forces in Taiz.

President Hadi should also help support the current governor’s legitimacy through greater financial support and ensuring that all civil servants in Taiz receive their salaries on a regular basis. While the consistency of public sector salary payments has improved relative to 2017, still not all civil servants are regularly receiving their salaries.

Saudi Arabia is the best-placed actor to compel Islah to follow the Yemeni government’s lead. This is due to the longstanding relationship between Saudi decision-makers and Islah, and the fact that many Islah leaders reside in or regularly travel to Riyadh.

UN Special Envoy for Yemen Martin Griffiths should be particularly interested in recent developments in Taiz, given how the governorate represents another power center where non-state actors are competing for influence. Ignoring Taiz could complicate his conflict mediation efforts between the main warring parties. He has recourse: Griffiths’ staff can communicate clearly with senior Islah figures, and other parties, that if their members are noncompliant and act as peace spoilers, their leadership will be placed on the UN 2140 Sanctions List.

General conflict de-escalation efforts in Taiz should also focus on opening the Sana’a Road. This thoroughfare is a key access route through the al-Hawban area, located northeast of Taiz city, and is currently a frontline between Yemeni government and Houthi forces. It connects Taiz with the cities of Ibb and Sana’a and opening it would dramatically reduce the time and expense it currently takes to transport people and goods to and from Taiz. An open Sana’a Road would thus increase humanitarian access to the population and reduce the cost of commercial goods.

Houthi forces are facing considerable pressure along various frontline areas around Taiz City, including: Haifan (east of Taiz City); al-Burj and al-Kadha (west of the city); al-Salal hill (to the northeast) and al-Qabbaytah and Karish (on Taiz’s southeastern border with Lahj governorate). Mediation efforts could thus involve de-escalation efforts along these frontlines in exchange for a ceasefire in al-Hawban and the reopening of Sana’a Road. Such would represent a major step towards ending the Houthi siege on government-held areas of Taiz City, and dramatically improve the dire situation facing the civilian population.  

Demonstrations against the economic situation in the country and the collapsing value of the Yemeni rial erupted in Taiz on October 2, with protesters rallying under the slogan “The Revolution of the Hungry.”

International Developments

Khashoggi Murder Focuses World Attention on Saudi Campaign in Yemen

On October 2, Saudi journalist and Washington Post columnist Jamal Khashoggi entered the Saudi consulate in Istanbul, apparently seeking documents related to his upcoming marriage. He was not seen alive again in public. While Saudi authorities initially claimed he had left the consulate later that day, Turkish officials soon asserted that Khashoggi had been killed by a 15-man hit squad that had flown in by private jet from Saudi Arabia. This group apparently included individuals who were part of the personal security entourage of Crown Prince Mohammed bin Salman.

Turkish authorities released video surveillance footage showing Khashoggi entering the consulate and members of the hit squad landing in Istanbul and also entering the consulate. This led to intensifying international pressure on Riyadh to explain the journalist’s disappearance. After putting forth various narratives throughout October trying to explain the event, by month’s end Riyadh had admitted that Khashoggi was killed at its consulate in a “premeditated” manner. Saudi officials further stated that they would hold accountable those responsible and arrested 18 people. Istanbul’s chief prosecutor stated at the end of October that Khashoggi had been killed and dismembered shortly after he had entered the Saudi consulate.     

US, UK Call for a Ceasefire in Yemen

In separate statements made on October 30, Secretary of Defense Jim Mattis and Secretary of State Mike Pompeo called for a ceasefire in Yemen within 30 days and urged all parties to participate in UN-brokered peace talks to bring an end to the conflict. In his strongest words yet on the subject, Pompeo said that the Houthis must cease long range drone and missile attacks on Saudi Arabia and the United Arab Emirates (UAE), after which the Saudi-led military coalition must halt airstrikes in populated areas. Mattis said that peace talks based on a ceasefire, a Houthi pullback from the Saudi border and the cessation of airstrikes should begin “within 30 days.”

While Mattis said that the two should not be considered as connected in terms of policy, the death of journalist Khashoggi at the Saudi consulate in Istanbul dramatically raised the profile of Yemen’s war in the US throughout October and prompted renewed calls for the US to reconsider its support for the Saudi-led military coalition. US officials, speaking off the record, said that Khashoggi’s death had altered the cost-benefit analysis in US-Saudi relations, with the Trump administration having “reached the maximum weight of what they’re willing to bear.”

On October 31, United Kingdom foreign secretary Jeremy Hunt reiterated the call for a ceasefire within a month. The same day, UN Special Envoy for Yemen Martin Griffiths said he was “committed to bring the Yemeni parties to the negotiations table within a month.” The following week, however, he retracted this commitment and said instead that he was aiming to bring the warring parties back to the table by the end of 2018.

US Legislators Call for Restrictions on Arms Sales to Riyadh

After the Senate Foreign Relations Committee triggered an investigation on October 10 into Khashoggi’s disappearance, Sen. Rand Paul (R-KY) introduced a bill that would cut off military aid to Saudi Arabia until the journalist was found “alive and free.” A group of bipartisan lawmakers then filed another, broader bill that, in addition to prohibiting arms sales, would also end any “security assistance” to Saudi Arabia, including intelligence and training support.

On October 19, Congressmen Ted Lieu (D-CA) and Jim McGovern (D-MA) introduced separate legislation that would increase congressional oversight of all US arms sales. The Arms Sale Oversight Act would allow any House member to force a debate on the floor in the event that the House Foreign Affairs Committee does not debate a weapons deal. In a tweet, Lieu specified exports to Saudi Arabia as in need of greater scrutiny – oversight that the congressman had been advocating for some time.

In response, President Donald Trump told reporters on October 20 that it would not be “helpful” to cancel arms exports to Saudi Arabia. He cited jobs and revenues tied up in US$110 billion worth of military contracts as part of wider bilateral agreements worth US$450 billion. This claim drew wide media attention, with Vox, Politifact, The Hill, and CNN, amongst others, disputing the figures and challenging Trump’s argument to continue arms sales based on domestic economic interest. Behind the scenes efforts to save existing deals took place in the wake of the Khashoggi affair, with the Aerospace Industry Association urging leading defence contractors to lobby government figures, and provide talking points when dealing with the media.

Also in the US, on October 8, Sens. Elizabeth Warren (D-MA) and Ro Khanna (D-CA) wrote a letter to Secretary of State Mike Pompeo challenging his September certification that the Saudi-led military coalition was taking measures to reduce civilian casualties in its operations in Yemen. An amendment to a defence spending bill passed in August made continued US support for the coalition conditional upon Pompeo’s certification (for details see The Yemen Review – September 2018). The senators said that the UAE and Saudi Arabia had failed to implement US recommendations and that statistics on civilian deaths from coalition airstrikes demonstrated that sufficient action had not been taken. They added that Pompeo’s certification memorandum indicated that the coalition had, at times, violated US laws regulating arms sales.

Western Nations Reconsider Arms Sales to Saudi Arabia

Numerous heads of state and legislators from Western countries responded to Khashoggi’s killing last month. On October 21, German Chancellor Angela Merkel said that Germany would no longer approve arms sales to Saudi Arabia as long as investigations on the case were ongoing. According to spokesman Steffen Seibert, the German government had not yet decided how to deal with arms sales that had already been approved prior to Merkel’s announcement. A day later on the public television broadcaster ZDF, German Economy Minister Peter Altmaier demanded a common European stance towards Saudi Arabia, noting that sanctions would only be effective if jointly implemented. To note, in its coalition agreement of March 2018, the new German government had agreed to no longer approve arms sales to states participating in the Yemen conflict. Nevertheless, FAZ reported on October 1 that, since taking office in March, the new German government had approved arms exports worth €254 million and €21.8 million to Saudi Arabia and other members of the Saudi-led military coalition, respectively.

Austria, currently holding the presidency of the Council of the European Union, reiterated the German call, with Austrian Foreign Minister Karin Kneissl, talking to the German Die Welt newspaper on October 26, demanding that the EU jointly halt arms sales to Saudi Arabia. Kneissl said that “the terrible war in Yemen” in particular should induce such common measures.

Other European and Western states, however, were more tentative in their responses. On October 21, the foreign ministers of France, the UK and Berlin released a joint statement in which they demanded further investigation into the case and accountability for the perpetrators of any crime committed.

On October 25, the Élysée Palace said that French President Emmanuel Macron had, in a telephone call the day before with Saudi King Salman bin Abdulaziz, demanded a full investigation into Khashoggi’s death. Macron added that in cooperation with its partners, France would not hesitate to impose sanctions against those found responsible for the killing – a position later reiterated by Minister for Foreign Affairs Jean-Yves Le Drian. On October 26, President Macron called the step to halt arms sales to Saudi Arabia “pure demagogy,” saying that while he understood “the link to Yemen,” there was none between arms sales and the Khashoggi affair. He added that he supported a common European reaction, such as sanctions, “once the facts [have been] established.”

While taking a stronger stance in condemning the killing of Khashoggi, a European Parliament resolution of October 25 largely stayed in line with the French position in calling upon the EU and its member states to “stand ready to impose targeted sanctions […] once the facts have been established.” According to the text, sanctions such as visa bans and asset freezes should be directed against the perpetrators as well as “the masterminds and inciters of this crime.” The resolution also called for an independent international investigation into the case and that EU member states propose to the Human Rights Council in early November that a Special Rapporteur be appointed to investigate human rights in Saudi Arabia.

On October 23, the Spanish parliament voted against a motion that called for a halt in arms sales to Saudi Arabia, following controversial statements and debates on the subject in Spain the preceding month (for more see ‘The Yemen Review – September 2018’).

On October 22, Canada’s opposition left-wing New Democratic Party demanded in parliament that the country end arms exports to Saudi Arabia in light of the kingdom’s military engagement in Yemen and the Khashoggi killing. The next day, Prime Minister Justin Trudeau warned that it would be difficult and costly to cancel a 2014 arms deal with Saudi Arabia, due to the terms of the contract, which is worth up to US$13 billion. On October 25, the prime minister then said the government was reviewing existing export permits of arms deliveries to Saudi Arabia, referring to the Khashoggi killing.

Meanwhile, Arab countries generally expressed support and solidarity with Saudi Arabia, with the exception of Qatar, which called the affair a “wake-up call for everyone.” Yemeni President Abdo Rabbu Mansour Hadi said the  “cheap political and media targeting of Saudi Arabia will not deter it from continuing its leading role in the Arab and Islamic worlds.” Meanwhile in Sana’a, Mahdi al-Mashat, president of the Houthi’s Supreme Political Council, defended Saudi Arabia against US threats of sanctions over the journalists’ death, condemning what he called a “humiliating approach” by President Donald Trump.


European Parliament Calls For a Comprehensive EU Strategy on Yemen

On October 4, the European Parliament voted in favor of a resolution calling for an immediate cessation of hostilities in Yemen and the resumption of peace talks led by the UN Special Envoy. The resolution supports confidence-building measures such as the complete reopening of Sana’a International Airport and the payment of civil servants’ salaries in all areas of Yemen. In light of the divergent policies of different EU member states, it calls on the EU’s foreign policy chief Federica Mogherini to develop a comprehensive EU strategy for Yemen.

The resolution repeats a previous call to impose an arms embargo on Saudi Arabia and urges EU member states to refrain from selling military equipment to coalition members. It says that such arms transfers are in violation of common EU rules. The text calls for the belligerent parties to be held accountable for their actions, and for the US to judicially oversee their use of military drones in Yemen.


Other International Developments in Brief:

  • October 1: The US announced that it had completed a two-week training of Yemeni Border Guard troops in Riyadh, in a program aimed at countering weapons and weapons-related smuggling. In August, US defense representatives met with Yemen’s Vice President Ali Mohsen al-Ahmar to discuss increasing cooperation and training of counterterrorism forces.
  • October 16: The Élysée Palace announced that the French sailor, Alain Goma, who had been detained by the armed Houthi movement since early June, had been released. It stated that French President Macron thanked the Omani and Saudi authorities for their help in liberating the French citizen, without disclosing any details on how he was freed. According to his family quoted by Le Monde, Alain Goma was flown to Oman.
  • October 17: South Korea’s Justice Ministry denied refugee status to 339 Yemeni asylum seekers, granting them one-year renewable humanitarian permits instead. The ministry rejected 34 others based on criminal charges and postponed the decision on 85 others. More than 500 Yemenis have, via Malaysia, arrived on the South Korean resort island Jeju this year, given its visa-free policy. This policy was, however, recently dropped for Yemenis following anti-refugee protests in South Korea. While the majority of these Yemenis have applied for refugee status, no requests have been granted. Most remain on Jeju island, as they are prohibited from travelling to the South Korean mainland.
  • October 19: US Senator Elizabeth Warren (D-MA) wrote a letter to Attorney General Jeff Sessions, requesting an investigation into claims that the UAE had paid US nationals to assassinate political figures in Yemen (see below ‘UAE Paid US Mercenaries to Assassinate Political Opponents in Yemen).
  • October 26: The Swedish mission to the UN Security Council (UNSC) hosted a closed breakfast meeting with representatives from the German mission to the UN, UN Women, and the Yemeni Women’s Pact for Peace and Security. Discussions revolved around how Germany, an incoming UNSC member state for 2019, could continue supporting women’s participation in Yemen’s political process at the council when Sweden’s term ends this year.
  • October 26: Sultan Qaboos of Oman received Israeli Prime Minister Benjamin Netanyahu at his palace in Muscat, in a diplomatic visit that likely signals a turning point in relations between Israel and countries in the wider Middle East.     
  • October 30: The Elders, a group comprised of high-profile world figures advocating for peace and human rights, released a statement calling on the UNSC – with emphasis on the United Kingdom, the United States and France, as the three major powers backing the Saudi-led military coalition forces – to take urgent action to bring an end to the blockade of Yemen and avert a humanitarian catastrophe. 

In Yemen

Military and Security Developments

Anti-Houthi Forces Launch New Offensive on Hudaydah

On November 2, Yemen’s armed forces announced the launch of a new “large-scale offensive” in the Red Sea port city of Hudaydah. Pro-government media reported on November 4 that government forces had taken the eastern, western and southern entrances to the city, gaining full control of the Kilo 16 that links Hudaydah to the Houthi-held capital Sana’a.

Brig. Gen. Abdulrahman Saleh al-Mahrami, one of the top commanders of the UAE-backed Giants Brigades, reported that his forces had reached the town of al-Saleh, 3 kilometers from Hudaydah port and in the vicinity of the Red Sea Mills, home to some of the country’s largest grain-storage silos. Houthi military spokesman Brig. Yahia Sarei denied the reports, calling them a “tactic of misinformation.” Sarei claimed Houthi rockets and artillery fire had destroyed much of their opponent’s military hardware, while Houthi minefields had caused enemy troop casualties. Houthi media reported that more than 50 coalition airstrikes had hit the Kilo 16 area, east of Hudaydah, and Hudaydah airport on November 3.

UAE-backed anti-Houthi forces supported by coalition air power launched an offensive on the strategic port city in June. Frontlines had remained largely static during October, with fighting centered on areas in the south of the governorate. On October 30, Yemeni military officials said 10,000 new troops were due to arrive in Hudaydah ahead of a fresh drive to take the port.

Report Claims UAE Paid US Mercenaries to Assassinate Political Opponents in Yemen

On October 16, Buzzfeed News reported that the UAE had hired former US special forces personnel to assassinate political figures and clerics associated with the Islah party in southern Yemen. The UAE regards Islah as the Yemeni branch of the international Muslim Brotherhood movement, which Abu Dhabi considers a terrorist organization.

Hungarian-Israeli security contractor Abraham Golan, founder of Delaware-based Spear Operations Group, said the UAE had flown his team to Aden and paid them US$1.5 million per month – plus bonuses for successful kills – to assassinate figures whom Emirati officials designated as targets. He said this campaign was “sanctioned by the UAE within the coalition” and Buzzfeed quoted several unidentified sources saying members of the assassination team were given ranks in the Emirati military to provide them with legal cover. Golan claimed that his group was responsible for killing numerous high-profile figures in Yemen, but declined to name any of the targets besides their initial operation.

The Buzzfeed report recounts the details of the group’s first alleged operation in December 2015, in which Golan said he led a team of US mercenaries, backed by former members of the French Foreign Legion, in a botched assassination attempt of Islah leader Anssaf Ali Mayo in Aden. According to Golan’s account, the mercenaries had planned to kill Mayo using an explosive device attached to the doorway of the party’s headquarters in the city; the device did explode, however, Mayo had left shortly beforehand. The Sana’a Center spoke with an Islah member who was at the headquarters that night and confirmed there was an explosion, and that Mayo had left the building shortly beforehand.

Following this, Golan said Emirati military officials provided his team with high-end American weaponry, such as C4 explosives, pistols equipped with silencers, and M4 rifles. The Buzzfeed report also notes that the team was “outfitted with motorbikes they could use to scoot through Aden’s traffic and affix magnetized bombs to cars.”

Credit: Ghaidaa Alrashidy, Sana’a Center research


Tensions Escalate Between Islah and UAE-Backed Forces in Hadramawt

Amid protests over security and economic conditions in the administrative region of Hadramawt Valley (Wadi Hadramawt), tensions escalated between UAE-backed groups and Islah-dominated military units. Hadramawt valley’s security committee said on October 9 that it supported the protesters, in defiance of Vice President Ali Mohsen al-Ahmar, whose forces control security in the area and clashed with demonstrators at the beginning of the month, according to reports on pro-separatist news websites.

On October 12, pro-UAE news website Golden News published a report in which Hadramawt Governor Faraj Bahsani accused Islah-affiliated brigades of harbouring “terrorist groups” in Hadramawt valley, and called for the deployment of the Hadrami Elite Forces in the region. Security control in the southeastern governorate is split between Islah-dominated forces loyal to Ali Mohsen in Hadramawt valley, and the UAE-backed Hadrami Elite Forces in the governorate’s coastal region. Bahsani’s comments came after STC spokesman Salim Thabet al-Awlaki declared that Hadramawt valley would be “purged” of Islah-affiliated forces.

Other Military and Security Developments in Brief


Political Developments

President Hadi Sacks Prime Minister Ahmed Bin Dagher

On October 15, President Abdrabbuh Mansour Hadi dismissed Yemeni Prime Minister Ahmed Bin Dagher, citing government “negligence” over the country’s economic crisis and the insufficient response to tropical cyclone Luban (see below ‘Cyclone Luban Hits Mahra’). Hadi added that bin Dagher would be placed under investigation for corruption and failing in his duties as prime minister. Bin Dagher had been in the post since the spring of 2016, when he replaced then-Prime Minister and Vice President Khaled Bahah.

Dagher’s successor, Minister of Public Works and Roads Maeen Abdelmalek Saeed, is Yemen’s fourth prime minister since 2012. He arrived in Aden from Riyadh on October 30. He is generally considered to be more technocratic than political. As minister of public works, Saeed has worked closely with Saudi Arabia on projects in Yemen. Saeed was also vice president of the government’s coordination committee, which oversaw the deposit of US$2 billion Riyadh had granted the Aden-based Central Bank of Yemen (CBY) earlier this year. A Taiz native, Saeed was part of government delegations to previous UN-brokered peace talks with Houthi officials and took over the ministerial portfolio for public works in May 2017. (For more analysis, see ‘What Does the New Head of the Internationally Recognized Government Mean for Yemen?’)

STC Call for Uprising Against the Yemeni Government Fizzles Out

On October 3, the Southern Transitional Council (STC), a UAE-backed secessionist group in southern Yemen, issued a statement saying that it supported a “popular uprising” against the Yemeni government, amid ongoing protests in southern governorates over price hikes and the devaluation of the rial. The STC said “catastrophic” government policies were to blame for the economic crisis and called for the seizure of government institutions “by peaceful means.” The STC’s call for an uprising represented the most serious escalation in Aden since deadly clashes between the separatists and pro-Hadi forces in January 2018, during which the STC had accused the government of corruption and called for its dissolution.

In a response to the statement, the government said it rejected the “Houthi and separatist rebellion, and all terrorist acts.” It also demanded the centralization of military units under state command and a halt to funding for armed groups outside of state control – taken to be a reference to various UAE-backed local security formations operating outside of the formal state military hierarchy in the south. Yemen’s Ministry of Interior added that the member states of the Saudi-led military coalition beared legal responsibility for the security situation in Aden and other government-held areas.

Shortly thereafter, STC leaders met with UN Special Envoy Martin Griffiths in Abu Dhabi, following which their public statements were noticeably more subdued. The STC then called off demonstrations it had slated for October 14, Yemen’s southern independence day. The STC statement cited the economic crisis, saying resources dedicated to the planned protests would instead be used for humanitarian assistance.

Other Political Developments in Brief


Economic Developments

Economic Committee Implements New Fuel Importation Regulations, Houthis Threaten Bankers With Imprisonment if They Comply   

Yemen’s financial and economic schism appeared to worsen in October, with the Aden-based and Sana’a-based authorities wrestling for control over import regulations and private sector financial players – particularly commercial banks – being caught between the two. The latest tensions relate to Ministerial Decree 75, which the Government of Yemen issued in September this year and whose aspects regarding fuel imports came into effect on October 9. Implementation of new regulations regarding food imports was postponed until November.

Decree 75 attempts, among other things, to limit fuel importers to only those approved by the Economic Committee, which the Government of Yemen established to help guide and implement its economic policy. The committee includes representatives from the Aden-based CBY and the banking sector, chambers of commerce and industry, and money exchange institutions. Those importers that meet the committee’s criteria are then eligible for import financing from the Aden-based CBY. Adherence to this importer selection is enforced in coordination with the Saudi-led military coalition – which has navy vessels patrolling Yemen’s coastal waters – and the United Nations Verification and Inspection Mechanism for Yemen (UNVIM), which is mandated to inspect all cargo ships headed for Houthi-held ports.

Among the Economic Committee’s criteria for approval are that importers must provide three years worth of bank statements from their operations. Furthermore, importers are required to deal with the banking sector, deposit their daily receipts from fuel sales into their accounts held in commercial banks, refrain from speculation in the currency market without the Aden-based CBY’s consent, and place a one-time deposit in a commercial bank account not less than 100 percent of the average value of the last five imported shipments.

These requirements would, however, disqualify many importers in Houthi-controlled areas. In July 2015, the Houthi authorities eased fuel importation and distribution restrictions in areas they control, opening the market – previously dominated by the state-run Yemen Petroleum Company (YPC) – for private sector actors. While pre-established private firms filled the immediate void left by YPC, in 2016 and 2017 a number of newly established players entered the market and quickly increased their share. This was due to a number of factors, chief among these being that the importers were on good terms with the Houthi authorities and were able to operate outside the commercial banking system, by using money exchange outfits for international financial transactions. In a recent alteration of this policy, the Houthi authorities have, since July 2018, required importers in areas they control to sell fuel directly to the Houthi-run YPC, allowing the Houthis a near monopoly on distribution in northern Yemen and thus the ability to set favorable profit margins.  

In response to the Economic Committee’s moves last month, Houthi officials held a meeting with representatives from Yemen’s commercial banks in Sana’a on October 18. Here, the former threatened the bankers with reprisals, including imprisonment of senior staff, if they abided by Aden-based CBY and Economic Committee directives. The Houthi threats are thus likely to impede the committee’s efforts, given that all but one of Yemen’s 17 banks are headquartered in Sana’a, the exception being Yemen National Bank, which has a head office in Aden.  

On November 4, the Sana’a-based CBY ordered commercial banks to refrain from using cash to cover letters of credit that are opened for imports, but rather that these letters of credit should be covered only using checks. This is an attempt to prevent the transfer of physical cash liquidity from Houthi-controlled areas to areas controlled by the internationally recognized Yemeni government.

Loopholes in the New Fuel Import Regulations

An example of the new fuel import regime in action came in mid-October, when the UNVIM denied two vessels authorization to dock at Hudaydah while their application to the Economic Committee was still pending. According to Sana’a Center sources, a single importer had arranged deliveries aboard the Al-Mirqab and Sea Heart, which were carrying 7,500 and 27,000 tons of fuel, respectively. The Economic Committee subsequently approved the importer’s application and the ships were permitted to dock.

The Sana’a Center Economic Unit learned that the importer, wary of Houthi reprisals for having interacted with the Economic Committee, had reached an arrangement with the Houthi-run YPC to allow him to proceed with the transaction unobstructed. Such ad hoc agreements, or possibly longer-term partnerships with fuel importers able to meet the Economic Committee’s criteria, proffer a potential avenue through which the Houthi authorities may circumvent the import restrictions of Decree 75.   

Bankers: Fuel Imports Primary Cause of Rial Instability

On October 11, the Yemeni Banking Association in Sana’a published the findings of a survey it had sent to Yemeni commercial banks. The survey asking the bankers what they regarded as the factors contributing to the Yemeni rial’s (YR) rapid depreciation in August and September this year. The primary factor the bankers identified, above all others, was the increased demand for foreign currency in the market spurred by importers of fuel derivatives.    

Sources: CBY, WFP, Sana’a Center Economic Unit

Yemeni Rial Fluctuates Wildly Throughout October

Since August 2018, the value of the Yemeni rial (YR) has experienced several waves of fluctuation. On October 1 alone, the YR’s value dropped 9 percent relative to the US$. This followed a 54 percent loss of value between July and September this year. In March 2015, when the current conflict intensified, the exchange rate had been YR215 per US$1.

In the first week of last month, the rial started to show signs of recovery, rebounding from YR765 per US$1 at the end of September to YR720 per US$1 by October 7. This was concurrent with the Saudi announcement of a US$200 million grant to the Aden-based CBY to shore up foreign currency reserves and support the rial. This comes in addition to the US$2 billion deposit Riyadh made at the Aden-based CBY earlier this year to allow it to finance imports of essential commodities and support the value of Yemen’s domestic currency. Also likely impacting the YR value, on October 3 global oil prices began a sustained slide.

In the second half of October, the rial entered another phase of depreciation, at its lowest trading in the range of YR730-760 per US$1. As of November 3, the rial had again regained ground to YR700 per US$1, after the Aden-based CBY announced the approval of US$170 million to finance the importation of basic foodstuffs, offering traders a preferential exchange rate of YR585 per US$1. In addition, the recent appreciation in the YR followed the arrival of a long-promised Saudi fuel grant amounting to US$60 million. This is part of a monthly grant Riyadh has allocated to support power plants in areas controlled by the internationally recognized government.

Houthis Appoint Governor for Sana’a-based CBY

In mid-October, the Houthis officially appointed Mohammed al-Sayani as the governor of the Sana’a-based CBY. Al-Sayani had been appointed deputy governor at the CBY in August 2012. Since President Hadi fired the previous CBY governor, Mohamed bin Humam, and officially relocated the CBY headquarters from Sana’a to Aden in September 2016, al-Sayani has been heading operations at the Sana’a-based CBY. His appointment as governor is thus essentially an official recognition of a role he had already been playing.

The Houthi appointment of a central bank governor is symbolic, however, of Houthi attempts to establish an independent monetary authority in areas they control. This, along with the undermining of the Economic Committee and the Aden-based CBY, is strategically important for the Houthis on various fronts, including to prevent the marginalization of Houthi-linked businesses and maintain their respective market share. as well as to allow liquidity to continue to flow through unofficial financial networks – namely money exchangers and the black market. A fully empowered Economic Committee would also help legitimize the Aden-based CBY and the Yemeni government.

The Houthi authorities also made two other notable appointments at the Sana’a-based CBY. The new deputy governor al-Shami had previously worked closely with Mohammed al-Houthi at the Supreme Revolutionary Committee, and in May 2018 had been appointed Undersecretary of the General Authority for Zakat. Youssef Zabara was also appointed Deputy Governor for Banking Supervision Sector.

UN Special Envoy: Economic Crisis the Top Priority in Yemen

On October 4, the UN Special Envoy to Yemen Martin Griffiths said that the plummeting value of the Yemeni rial should be the top international priority regarding Yemen and stressed the need for an emergency plan to help address this crisis. He explained that the plan could be formulated in a collaboration between the World Bank, the International Monetary Fund, UN agencies, Arab Gulf countries, and the internationally-recognized Yemeni government. On October 30, Griffiths stated that confidence-building measures for future negotiations would focus on “enhancing the capacities of the Central Bank of Yemen.”

The Special Envoy has, on multiple occasions in recent months, attempted to arrange meetings in Nairobi between representatives from the Sana’a and Aden-based CBY branches. These efforts aimed to kickstart the process of reunifying the CBY,. However, Griffiths attempts to stage these meetings failed. Moves by both the Economic Committee, the Aden-based CBY, and the Houthi authorities in Sana’a in October have likely increased the difficulty the Special Envoy faces in bringing together the CBY representatives.

In early November, Griffiths staged expert-level consultations in Amman, among which the topics of discussion included Yemen’s economic situation. Given the lack of influential decision makers at the meeting, however, there were little substantive outcomes.


Humanitarian Developments

UN Warns of Worst Famine in a Century

On October 15, the UN warned that Yemen was on the brink of the “worst famine in 100 years.” Lise Grande, the humanitarian coordinator for Yemen, said that mass starvation could engulf the country in the next three months, should fighting continue. Violence continues to impede the passage of aid and essential goods, while the rapid depreciation of the rial has caused fuel and food prices to soar – pushing almost two-thirds of the country’s population into food insecurity.  

Source: WFP and Sana’a Center Economic Unit Survey for October 2018

In a briefing to the UN Security Council on October 23, Mark Lowcock, the UN’s humanitarian coordinator, said that his September estimate of the number of Yemenis facing pre-famine conditions was incorrect, adjusting the number from 11 to 14 million half the country’s population. Lowcock added that the risk of famine was currently greater than at any other point in Yemen’s war, owing chiefly to fighting around Hudaydah and the economic crisis. He slammed government regulations on imports of essential commodities, saying that vessels carrying much-needed fuel had been refused entry in the days preceding, and cautioned against the extension of the regulations to food imports scheduled for November (see above ‘Economic Committee Implements New Fuel Importation Regulations). In addition to a humanitarian ceasefire, Lowcock recommended a swift injection of foreign currency into Yemen’s economy to buttress the plunging rial. (For more on the connection between famine and the collapsing currency, see “Famine at Hand Without a Reunified Central Bank to Protect the Yemeni Rial”).

Cyclone Luban Hits Mahra

On October 14, Cyclone Luban made landfall in Yemen’s eastern Mahra governorate, with the UN estimating that 2,200 families were displaced by the storm. Mahra’s Emergency Operations Room confirmed three deaths and more than 100 injuries. Heavy floods damaged houses, water and electricity infrastructure in a number of districts, and blocked the main road linking Mahra to Hadramawt governorate, impeding humanitarian access. On October 15, the government declared Mahra a disaster zone.

The United Nations Population Fund, the Saudi King Salman Relief Centre, the Oman Charitable Organization and other national and international organizations assisted in providing tents, blankets, mattresses, humanitarian assistance, food baskets, and other emergency and medical supplies. In August OCHA reported that less than five organizations operate in Mahra, and in some districts organizations have no presence.

By October 21, rainfall had ceased in a number of Mahra’s cities and water levels in valleys had begun to decline. The numbers of displaced were reported to have decreased, with families returning to their homes. Following a visit to the governorate, Yemen’s new prime minister, Maeen Abdelmalek Saeed, announced on October 27 the allocation of YR2 billion for reconstruction in Mahra.

Other Humanitarian Developments in Brief

  • October 2: The World Health Organization (WHO) said cholera was on the rise again in Yemen, with 10,000 suspected new cases reported each week. In the first week of October, a six-day joint WHO-UNICEF campaign vaccinated more than 300,000 people in parts of Hudaydah and Ibb governorate.
  • October 7: UNICEF announced the third cycle of cash support assistance in Yemen – estimated to reach 1.5 million families. The World Bank-supported program began in August 2017 and aims to boost civilian purchasing power amid the rial’s rapid devaluation
  • October 21: Yemen’s education minister, Abdullah Lamels, said in a forum in Tunisia that more than one million children have been unable to attend school because of the conflict. He added that since the war started, more than 3,600 schools have closed down across the country.
  • October 22: Saudi Arabia and the UAE announced a US$70 million donation earmarked for salary payments to 135,000 teachers in Yemen.
  • October 30: As of this day, the UN and partner organizations had received 70.7% of the US$3 billion requested to implement its 2018 humanitarian response plan for Yemen.


Human Rights and War Crimes Developments

Airstrikes Kill Tens of Civilians in Hudaydah Governorate

On October 13, Saudi-led military coalition airstrikes hit mini buses passing a Houthi checkpoint in Jabal Ras town, Hudaydah governorate. The attack killed 15 civilians and injured 20, according to the UN. On October 24, airstrikes hit a vegetable packaging factory in Bait al-Faqih district, Hudaydah governorate, killing at least 21 civilians and injuring 10. On the same day, another three civilians were killed and six injured when airstrikes hit three vehicles in Hudaydah’s al-Hali district.

Houthis Detain Protesters in Sana’a and Ibb

On October 6, demonstrators turned out in Sana’a following calls on social media for protests in Tahrir Square against the declining economic conditions, under the slogan “The Hunger Revolution.” Houthi forces deployed across the city and at checkpoints prior to the demonstrations, including Houthi-trained female security forces, according to a female university student who spoke with the Sana’a Center. During the demonstrations, dozens of protesters were beaten and arrested. The female university student, who was among those arrested, said those detained were taken to a police station, investigated, and forced to sign pledges that they would not partake in future protests.

Simultaneous protests also occurred in front of Ibb University, according to online newspaper al-Masdar. Houthi forces responded similarly, with those arrested transferred to the Political Security building, but subsequently released.

Houthi media said the protesters were “mercenaries tasked by the aggressors to plant rumours and disturb public peace.” The official Houthi TV channel al-Masirah had, the day before the protests, aired a video about human rights activist Ali al-Sharabi, whom the Houthi Political Security forces had detained on September 18. Al-Sharabi appeared disheveled  in the video, in which he confessed to purposely instigating the demonstrations to stir unrest.

Prior to his arrest, al-Sharabi had been working in the Ministry of Civil Services as a department manager and regularly published statements critical of the armed Houthi movement on social media. On October 22, his family was allowed to visit him for the first time since his arrest.

Other Human Rights and War Crimes Developments in Brief

  • October 5: Ali Zaki al-Saqaldi, an Islah member and correspondent for al-Masdar in the southern city of al-Dhale, was killed by unknown gunmen.
  • October 5: Houthi forces shelled the bin Jaber camp for Internally Displaced People (IDPs) in Hudaydah city, killing one woman and injuring 12 civilians.
  • October 6: Artillery fire on an IDP camp in the Khoukhah area of Hudaydah City killed a civilian and injured 12 others, according to the UN.
  • October 16: Houthi landmines killed six civilians and wounded dozens in Tahyta district in Hudaydah city, according to Al-Masdar.
  • October 20: An airstrike killed one civilian and injured four, near a fuel station on Zayed Street in Hudaydah city.
  • October 21: Airstrikes on a vehicle traveling in the Bani Hasan area in Abs, Hajjah governorate, killed two civilians and injured three.
  • October 22: Two photographers were kidnapped by Houthi forces in Hudaydah City according to Al-Masdar.
  • October 22: The Yemeni Journalists Syndicate reported that the third quarter of 2018 – July 1 through September 30 – had seen 35 “violations” against the media. These included four members of the press murdered, 11 kidnapped, six attacked, and 14 detained under harsh conditions in Sana’a. The syndicate implicated all parties to the conflict in these violations.
  • October 25: Houthi security forces raided a civil society event in Sana’a regarding intolerance in Yemeni media. Among those arrested were the former head of Yemen’s Journalists Syndicate, Abdulbari Taher, as well as some of the country’s most respected media figures and intellectuals.    

This report was prepared by Waleed Alhariri, Holly Topham, Hussam Radman, Ghaidaa Alrashidy, Anthony Biswell, Sala Khaled, Aisha al-Warraq, Ali Abdullah, Victoria K. Sauer, Hamza al-Hamadi and Taima al-Iriani.

The Yemen Review – formerly known as Yemen at the UN – is a monthly publication produced by the Sana’a Center for Strategic Studies. Launched in June 2016, it aims to identify and assess current diplomatic, economic, political, military, security, humanitarian and human rights developments related to Yemen.  

In producing The Yemen Review, Sana’a Center staff throughout Yemen and around the world gather information, conduct research, and hold private meetings with local, regional, and international stakeholders in order to analyze domestic and international developments regarding Yemen.

This monthly series is designed to provide readers with contextualized insight into the country’s most important ongoing issues.

This month’s report was developed with the support of the Kingdom of the Netherlands and the Friedrich-Ebert Yemen office.

Beyond the Business as Usual Approach: Combating Corruption in Yemen

Beyond the Business as Usual Approach: Combating Corruption in Yemen

Corruption, or the abuse of power for private gain, is deeply entrenched in the Yemeni political economy. For decades Yemen has witnessed state capture, with political leaders at the highest level extracting rents from state institutions to benefit a select few. Administrative corruption, too, has been commonplace in Yemen: low-level bribery and favoritism have become a part of everyday life. There is arguably a cultural acceptance — even an expectation — of corruption in politics and business, as informal networks have come to wield more influence than official institutions.

Policy Brief: Corruption in Yemen’s War Economy

Policy Brief: Corruption in Yemen’s War Economy

Executive Summary

Corruption, or the abuse of power for private gain, has been deeply entrenched in the Yemeni political economy for decades. Over the course of the ongoing conflict, however, as the war has fragmented and regionalized the country, state capture in Yemen has become far more complex. In the war economy, patronage networks are now emerging among previously marginal or unknown figures. The financial involvement of Saudi Arabia and the United Arab Emirates has extended patronage across national borders. Alleged collusion between Houthi-affiliated importers and officials allied with the internationally recognized Yemeni government indicates patronage networks that potentially cross the frontlines of the war themselves. As greater numbers and a wider variety of actors profit from illicit activity in the war economy, vested economic interests in continued conflict become more entrenched.

If state capture is among the main drivers of Yemen’s war economy, then post-conflict recovery must include a strong anti-corruption agenda. Policymakers must begin planning to address corruption as a part of a potential post-conflict strategy. Given the multi-faceted pervasiveness of corruption in Yemen, any anti-corruption agenda must aim to understand the complex configuration of patronage networks in Yemen, to be introduced gradually, and to get the buy-in of as wide a group of Yemenis as possible. Without these basic building blocks, more specific policy changes such as encouraging transparency or reducing conflicts of interest may founder. Corruption has become deeply entrenched in Yemen; any post-conflict anti-corruption agenda must be great in scope and long-term in vision.



Corruption, or the abuse of entrusted power for private gain,[1] is endemic in Yemen. In 2017 global anti-corruption watchdog Transparency International ranked Yemen 175 out of 180 countries, with an index score of only 16 on a scale of 0-100 where zero is highly corrupt.[2] Yemen’s index score has trended downward in the past several years, indicating increased corruption.[3]

Corruption in Yemen is not a new development. For decades the country has witnessed what the World Bank terms “state capture,” wherein an elite minority distorts state institutions for illicit gain.[4] A narrow range of actors have manipulated Yemen’s state institutions, reaping the rewards of their elevated position and dictating the rules of the game.

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The country’s informal elite networks have become more influential than formal state institutions — another hallmark of state capture.[6] State capture and lower-level administrative corruption, characterized by everyday bribery and favoritism,  have been underpinned by informal institutions and a tacit cultural acceptance in Yemeni society that the abuse of power in business and politics is simply “how things are done.”[7] Despite the presence of a legal framework that technically prohibits such practices, arbitrary fines and unpredictable bribes to authorities are considered commonplace.[8]

The ongoing conflict in Yemen has not altered the basic workings of this system of state capture. An elite minority of actors continues operate according to rules of the game that remain fundamentally unchanged from before the conflict. However, the players involved are shifting. Yemen’s burgeoning war economy has seen the emergence of previously marginalized or unknown actors. Patronage networks now cross frontlines, with perceived adversaries willingly cooperating for the sake of maximizing private gain. The networks also now extend beyond Yemen’s borders. To some extent, these shifting patronage networks — and the war economy that supports them — are a driving force behind the conflict. If Yemen is to recover from this period of violence and instability, corruption cannot go unaddressed.

The following policy brief details the development of Yemen’s war economy, new players and dynamics in Yemen’s corruption networks, and then offer recommendations to international stakeholders and the Yemeni government to curb the worst excesses of corruption over the long run post-conflict.


Corruption in Yemen’s War Economy

As the conflict in Yemen has evolved since March 2015, so too has its burgeoning war economy. In the war economy, corruption has become systemic and even, to some degree, apolitical. At first glance, actors who are politically and militarily opposed to one another compete for influence on the ground. Beneath the surface, however, the reality is more complex. A wide array of actors shape Yemen’s thriving war economy: senior decision-makers, military commanders, established and newly empowered businessmen, local security officials that control checkpoints, commercial bankers, money exchangers, truck drivers and civil servants. Networks of corruption transcend the conflict, seamlessly crossing frontlines and regional borders, with perceived adversaries cooperating for the sake of maximizing profits.

New Actors in Control of State Resources

The conflict has seen state resources – specifically energy resources – come under the control of actors that were previously marginalized or unknown. In northern Yemen, the Houthis have taken control of the import, distribution, and sale of fuel as well as customs and taxation, the telecommunications sector, and car imports.[9] The internationally recognized government, led by Hadi, nominally controls all areas not controlled by the Houthis. However, for large periods of the conflict, Hadi and members of his cabinet have operated from exile in Riyadh, Saudi Arabia.

In the functional absence of the internationally recognized government, the UAE-backed pro-southern independence body Southern Transitional Council (STC) has been gaining influence in southern Yemen. A large swath of Yemen’s southern coastline that stretches from the southwestern Taiz governorate to northeastern al-Mahra governorate – and includes the ports located in Taiz, Aden, Hadramawt, Shabwa, and al-Mahra governorates – is now monitored by the UAE directly or through UAE-backed security actors such as the Hadrami and Shabwani Elite forces. The Hadrami and Shabwani Elite forces also have influence over the key energy facilities in both Hadramawt and Shabwa.[10] Meanwhile, the country’s other major energy facilities in Marib, nominally under the authority of the internationally recognized government, are increasingly under the independent control of the governorate’s own local authorities.


Mechanisms of Corruption in Yemen’s War

Inflating Military Payrolls

As in Saleh’s era, the inflation of military payrolls with non-existent soldiers (“ghost soldiers”) continues to be a major source of patronage for actors operating within Yemen’s military and security apparatus. Senior officers, particularly those operating under the banner of the internationally recognized Yemeni government, reportedly exaggerate the number of soldiers under their command in order to pocket the excess salary payments. Government officials are also thought to be complicit in this scheme.[11]

Besides salaries, senior military commanders receive matériel (weapons, ammunition, fuel, vehicles and other important equipment) based on the number of soldiers that they claim to have under their command. Inflating their payroll results not only in extra salary payments but also extra matériel, which can then be sold at a profit.

The money for inflated payrolls comes primarily from the two dominant members of the Saudi-led coalition, Saudi Arabia and the UAE. The entrance into the conflict of these two wealthy patrons has increased the incentive for various anti-Houthi tribal, military, and security commanders to fabricate the number of men under their command.[12] Lower down the chain of command, anti-Houthi military and security personnel “double dip” — they are registered for payment on more than one command roster, thus receive two separate salaries from two different sources. s the two wealthy countries continue to fund inflated and duplicated military payrolls, Yemeni patronage networks extend beyond national borders.

There is evidence to suggest that weapons reportedly being smuggled to the Houthis pass through areas nominally under the control of the internationally recognized Yemeni government.[14] While the details of the weapons flows are uncertain (regarding weapon type, quantity, and entry point into the country), the ease with which weapons make their way from the eastern governorates to Houthi-controlled areas indicates willing collusion among actors affiliated with both sides of the conflict. If both parties to the conflict are in fact profiting from the same weapons flows, it suggests that patronage networks have come to transcend the conflict’s frontlines.

Monopolizing Fuel Imports

After Yemen’s oil and gas facilities went offline, the country became dependent on fuel imports. This presented an opportunity for established players and for those looking to capitalize on the country’s fuel needs. Fuel imports have become the most lucrative branch of Yemen’s energy sector during the conflict.[15]

Ahmed al-Eisi is the dominant player in Aden. Al-Eisi is aided in his dominance by his ownership of the top maritime fuel transportation company in Yemen, Alessi Group. Opaque  tender bidding processes essentially hand al-Eisi the procurement contract for supplying fuel to Aden: one contract viewed by the author contained conditions that included a tight fuel delivery deadline that no other applicant could meet.[16] With Alessi Group holding a monopoly over Aden Refinery Company (ARC), the sole entity authorized to import fuel into Aden, al-Eisi in effect has a monopoly over fuel imports — and, by default, distribution. Although Hadi in March 2018 nominally “liberalized” fuel imports in areas under the nominal control of the internationally recognized Yemeni government, there have been no visible changes in al-Eisi’s monopoly in Aden thus far.

In Houthi-controlled areas, fuel imports are an equally significant source of patronage. Houthi-affiliated fuel importers who were previously unknown to members of the Yemeni business community have over the course of the conflict learned from — and supplanted  — established players such as CruGas.[17] These Houthi-affiliated fuel traders now effectively control fuel imports through Hudaydah Port and domestic fuel market sales in areas under Houthi control. They allegedly import low-quality Iranian petrol and diesel in order to sell it on the local Yemeni market for a significant markup.[18] They have reportedly targeted the assets, such as fuel transportation trucks and petrol stations, of non-Houthi traders.[19] They also reportedly require non-Houthi competitors to pay hefty unofficial last-minute fees to unload at Hudaydah Port.[20]

Notably, the blockade of Houthi-controlled ports introduced another source of patronage. The Saudi-led coalition would only permit imports if the request had President Hadi’s seal of approval. This empowered Hadi’s son, Jalal Abdo Rabbu Mansour Hadi. Despite holding no official government position, from March 2015 until the installation of the UN Verification and Inspection Mechanism for Yemen (UNVIM) in May 2016, Jalal reportedly became the man to contact and essentially pay off in order to obtain the necessary fuel import permits.[21] Houthi-affiliated businessmen reportedly established a good working relationship with Jalal as a result of obtaining fuel import permits for Hudaydah through him. They obtained those permits through middlemen that brokered deals in Sana’a that were then signed off on in Riyadh.

Misusing State Funds

Besides enabling the specific mechanisms of inflating military payrolls and monopolizing fuel imports, the conflict has allowed governing authorities to avoid scrutiny on their use of funds. In some instances, this is merely a lack of transparency: in Marib, for example, the Central Bank of Yemen (CBY) branch is unwilling to disclose the numbers behind its locally sourced revenues and expenditures.[22] Also hidden from scrutiny are the customs revenue generated from Yemen’s ports, the Houthi-controlled inland customs checkpoints, and the Shahen and al-Wade’ah land borders with Oman and Saudi Arabia.[23]

However, governing authorities on both sides have also reportedly actively misused state funds. I n 2017, 2 billion Yemeni rials (YR), printed in Russia and en route to the CBY in Aden, were reportedly delivered straight to the presidential palace in Aden; by now the money has allegedly been disbursed via the office of the prime minister as “discretionary spending.”[24] For a time, the internationally recognized government was receiving payments for its stake in the Masila oilfield in Hadramawt directly into a private bank account held at AlAhli bank in Saudi Arabia in President Hadi’s name.[25]

The Houthis, meanwhile, have been accused of diverting money from the CBY in Sana’a to pay for their military campaign.[26] The money is allegedly used to pay the salaries of Houthi military and security commanders and their respective fighters. It was also used to pay for thousands of Houthi-sanctioned civil servants installed by the group in the Ministry of Interior in Sana’a as part of a broader strategy in which they sought to replace Saleh loyalists with Houthi supporters over the course of 2016 and 2017.[27] The Houthis reportedly installed many young, inexperienced, unqualified individuals in senior positions at the ministry as part of an attempt to weaken Saleh and his allies’ hold over north Yemen’s military and security apparatus, with the Republican Guard one of the main targets.[28] This Houthi effort to staff important institutions with supporters served the aim of garnering power and as well as a system of patronage to provide employment and comparatively stable government salaries to Houthi supporters.

Yemen’s war economy presents a challenge to any policymaker concerned with building peace in Yemen. It is clear that no one individual or group is solely culpable for corruption. Instead, what external analysts might see as corrupt practices are widely accepted as normal transactions – simply the cost of doing business. More importantly, the conflict’s shifting, expanding networks of patronage may form the basis of the kind of informal institutions that could enable corrupt practices in a post-war context. This could potentially endanger the prospect of peace. Corruption, therefore, must be an integral part of any post-conflict agenda.


Conclusion and Recommendations

As the war in Yemen continues, the main sources of patronage and power — control over state institutions and access to major sources of revenue — remain unchanged from Saleh’s era. Weapons flows, tendering processes, fuel subsidies and falsified military payrolls continue to enrich the few at the expense of the many.

However, Yemen is witnessing a shift in the individuals involved. Patronage networks have become more complicated. Previously marginal or unknown figures are making inroads into traditional means of illicit profit. Parallel state institutions have emerged, affording new instances of state capture. The entrance of two wealthy regional patrons — Saudi Arabia and the United Arab Emirates — has changed the calculus of wealth. Reported collusion between Houthi-affiliated importers and senior officials allied with the internationally recognized Yemeni government, if true, represents adversaries at war cooperating for purposes of private gain.

Despite the grim reality of ongoing corruption in a conflict that shows little sign of abating, policymakers must nevertheless begin now to consider how to build a lasting peace. If corruption is among the main drivers of the conflict, then post-conflict recovery must include an anti-corruption agenda.

Given the complex nature and wide reach of corruption in Yemen, any anti-corruption agenda must seek to understand the complex configuration of patronage networks in Yemen, to be introduced gradually, and to get the buy-in of as wide a group of Yemenis as possible. Without these basic building blocks, more specific policy changes such as encouraging transparency or reducing conflicts of interest may founder. Corruption has become deeply entrenched in Yemen; any post-conflict anti-corruption agenda must be great in scope and long-term in vision.


Guiding Principles

Acknowledge Complexity

Any attempt to address the abuse of power in Yemen should include a detailed analysis of the complex, context-specific mechanisms of corruption at the heart of Yemen’s war economy. Rather than shying away from the time-consuming and difficult task of disentangling the broad, ever-evolving political and economic relationships among the actors engaged in corrupt activity, policymakers must attempt to understand such complexity. A well-developed contextual understanding will allow policymakers to weigh up potential benefits and anticipate pitfalls when developing a anti-corruption strategy. Constant observation and analysis is key to keeping pace with developments on the ground.[29]

Implement Gradually

State capture should be rolled backed gradually, with a phased implementation of anti-corruption reforms. It would be unrealistic and perhaps counterproductive for policymakers to introduce a sudden and aggressive anti-corruption strategy. Actors currently profiting from the war economy may resist wholesale changes. Worse, rushed or superficial efforts to combat corruption may lead to grave policy errors where instead of restraining the actions of corrupt individuals the policies lead to greater suffering among the Yemeni people, who are already dealing with the world’s worst humanitarian crisis.[30]

Engage as Many Actors as Possible

Given the widespread reach of corruption in Yemen, anti-corruption efforts should not selectively target any single actor, but should instead seek to have an impact across the system as a whole. While efforts should certainly be made to curb the activities of actors known to be engaging in corruption, such actors should not be singled out exclusively. To do so would leave policymakers  open to accusations of political bias. If any breakthrough is to be made in creating short- or long-term peace, policymakers will need the buy-in of as many actors as possible.


Recommendation for the Government of Yemen’s Post-Conflict Policies

Build on the Existing Anti-Corruption Framework in Yemen

  • Strengthen Yemen’s existing state-run anti-corruption agencies, including the Central Organization for Control and Auditing (COCA), Supreme National Authority for Combating Corruption (SNACC), the Real Estate Authority, and the Financial Information Unit (FIU).
  • Sufficiently fund the anti-corruption agencies to provide training and institutional capacity-building programs.
  • Encourage greater coordination and data-sharing among already established anti-corruption agencies.
  • Ensure that all anti-corruption agencies operate independently of government officials.

Encourage Transparency and Accountability

  • Conduct a recurring, independent audit for all state-owned and state-run companies.
  • Establish a government agency to process freedom of information requests, in accordance with Law No. 13 of 2012 concerning the Right of Access to Information.
  • Create a new regulation whereby appointed officials publicly release annual personal financial statements during their tenure.
  • Make publicly available the details of all government tenders and the details of the salaries and bonuses of all senior government staff.
  • Establish a system issuing national identification numbers to Yemeni citizens and to non-Yemeni residents who have secured a residency visa. Link the number to personal financial information and biometric data stored on a secure and confidential government database.
  • Officially register and publish all government assets, including weapons inventories.

Reduce Conflicts of Interest

  • Implement conflict of interest measures to ensure that personal relationships between government officials responsible for tenders and companies competing for those tenders do not influence the awarding of contracts.
  • Legally obligate government employees to relinquish control of any private businesses.
  • Regularly rotate on a mandatory basis all positions that are central to economic control and management (e.g. in state-run energy companies).
  • Implement new regulations establishing equal employment opportunities within the public sector.
  • Ban the issuing of state-run contracts to senior military commanders.
  • Gradually dismantle checkpoints to reduce the incidence of bribes.
  • Reform, unify and gradually downsize the military and security apparatus.

Improve the Management of Government Finances

  • Establish a system for collecting government receipts and controlling the disbursal of money to the different branches of government and state institutions.
  • Implement a new national budget and make the details of it publicly available.
  • Ensure tight budgetary controls and supervision over government revenues and expenditures.
  • Restore the CBY to a fully functioning independent national entity. While the government should set spending priorities, the CBY should be in charge of the distribution of these funds according to the national budget.
  • Deposit all revenues generated by the respective central governing authorities in the local CBY branch (e.g. in Aden, Marib, Hadramawt, Sana’a, or Taiz) rather than redirecting them to government officials’ offices.
  • International stakeholders must draft, deliver, and monitor implementation of a long-term financial assistance package that makes assistance conditional on continued adherence to existing anti-corruption legislation. Focus on channeling donations through local government institutions, local NGOS or INGOs on the ground in Yemen, when and where appropriate to minimize the opportunities for bureaucratic corruption.
  • Closely monitor financial assistance provided for post-war reconstruction and local development projects. Make such assistance conditional upon progress toward stated outcomes.

Decentralize Economic Power

  • Empower local authorities, specifically local councils, to deliver public services and implement local development projects.
  • Aid the creation and expansion of small and medium-sized enterprises (SMEs) to facilitate economic diversification and economic growth.
  • Empower anti-corruption agencies to monitor fuel import companies, investigating discrepancies over registered and real owners. Their findings, along with accurate company details, should be made publicly available.



[1] “What is Corruption?” Transparency International, accessed June 25, 2018,

[2] “Corruption Perceptions Index 2017,” Transparency International, last modified February 21, 2018, accessed June 25, 2018,

[3] “Corruption Perceptions Index 2017 Shows High Corruption Burden in More than Two-thirds of Countries,” Transparency International, last modified February 21, 2018, accessed June 25, 2018,

[4] World Bank, Anticorruption in Transition: A Contribution to the Policy Debate, (Washington, DC: World Bank, 2000) accessed June 25, 2018, 1,

[5]  For details regarding corruption in Yemen during the rule of late former President Ali Abdullah Saleh, please see the full white paper of “Combating Corruption in Yemen” at

[6] Glenn E. Robinson et al., Yemen Corruption Assessment (Burlington, VT: ARD, 2006) accessed June 25, 2018,

[7] Abdulwahab al-Kibsi has called this the “inevitability mindset” — Yemeni citizens have come to expect corruption to be so pervasive that they themselves are powerless against it. Abdulwahab Alkebsi and  Christopher Boucek, “Corruption in Yemen: Screening of Destructive Beast,” Carnegie Endowment for International Peace, last modified September 30, 2010, accessed June 25, 2018,

[8] Researcher interview, October 2017.

[9] In addition to the customs duties the Houthis charge at Hudaydah Port, they also established a number of internal customs checkpoints over the course of the conflict. The major customs checkpoints are located in al-Bayda governorate, Arhab district in northern Sana’a governorate, and Dhamar governorate. The Houthis also installed other customs checkpoints for travel between the following destinations: Marib–Sana’a, Taiz–Ibb, Abyan–al-Bayda, and al-Dhalea–Dhammar. While conducting research for this paper, several sources spoke to the author about the “probability” that there are individuals (both Houthi and non-Houthi-affiliated) that are  exploiting the customs and taxation system the Houthis established for their own personal gain. Though investigations are ongoing, at the time of writing, the research had not yielded enough verified information to present in this paper.

[10] During the conflict, the UAE helped establish local security forces across southern and eastern Yemen, providing them with training, arms, equipment, and money. There are the Security Belt forces in Aden, Abyan, and Lahij, as well as the Hadrami Elite and Shabwani Elite forces.

[11] Peter Salisbury, “Yemen: National Chaos, Local Order,” Chatham House, last modified December 20, 2017, accessed May 23, 2018, 20.

[12] Tribal leaders providing security forces are also paid through a similar mechanism. Sources with a first-hand knowledge of the composition of anti-Houthi forces stationed in Marib, claim that Saudi Arabia is paying for approximately 50,000 anti-Houthi fighters.This number is almost certainly inflated and is thought to include money paid to secure the backing of local tribes. Researcher interviews, Cairo, February and March 2018.

[13]  Private conversations with Adeni activist, April and June 2018. To note but one example, this is known to occur in some of Yemen’s southern governorates such as Aden where UAE-backed security actors are present. According to a source well-connected with Security Belt (Hizam Amni) forces, there are members of Security Belt who receive a salary from their chief patron, the UAE, while also being registered on a separate list with the Yemeni ministry of interior.

[14] Notably, there were no weapons seizures off Yemen’s western coastline in 2017 or in the first half of 2018. Weapons are being transferred from Yemen’s eastern governorates, particularly al-Mahra and Shabwa, to Houthi-controlled areas via al-Bayda or Marib governorates: testament to the fact that “business as usual” continues with regard to weapons smuggling. As long as each party along the way is paid their share – from arms dealers to those driving the trucks and individuals stationed along the road manning the checkpoints – then arms sales run smoothly, no matter where those arms are destined. This conclusion is based of numerous conversations and interviews with tribesmen from shabwa, well-informed contacts with knowledge of known smugglers in al-Mahra, senior military commanders, among others from January until May 2018.

[15] Two key developments in 2015 gave fuel imports added importance: (1) a sudden decline in oil and gas production and the cessation of oil and gas exports due fighting on the ground that also led to the departure of foreign energy companies; and (2) the Houthis’ decision to eradicate fuel subsidies on July 27, 2015 (a year after they staged on the outskirts of Sana’a a public opposition campaign against Hadi for doing the same thing) and easing of fuel import restrictions. See Yemen Ministry of Planning and International Cooperation, “Oil Sector Recovery in Yemen Urgently Needed,” ReliefWeb, last modified May 2016, accessed June 15, 2018,; Abubakr al-Shamahi, “Yemen Returns Full Circle as Houthis End Fuel Subsidies,” New Arab, last modified July 28, 2015, accessed June 15, 2018.; “Houthis Cut Oil Subsidies Endangering Support,” Medialine, last modified August 3, 2015, accessed June 15, 2018.

[16] Private conversations with a Yemeni fuel trader, January-March 2018.

[17] Ammar Tawfiq Abdulrahim Mutahar runs CruGas. He is also the listed Deputy General Manager of Tawfiq Abdulrahim Mutahar Group (“TAM”) but is reportedly not on good terms with his brothers who have taken over TAM following the death of their father Tawfiq in 2013.  Mohamed al-Absi, “What is the Truth about the Oil Company and the Black Market?” (blog), June 7, 2016, accessed June 25, 2018,

[18]  When sold on the black market, the profit margin is particularly large. Mohamed al-Absi, “Since the Disaster of Flotation Fuel in the Stations with Official Pricing: More Black Market Scandals,” Mohamed al-Absi (blog), December 5 2016, accessed June 25, 2018,; Mohamed al-Absi “Document: Mechanism for the Purchase of Oil Company 50% of Shipments Merchants Sold to the Citizen at the Official Price,” Mohamed al-Absi (blog), June 28, 2016, accessed June 25, 2018,

[19] Mohamed al-Absi, “Since the Disaster of Flotation Fuel in the Stations with Official Pricing: More Black Market Scandals,” Mohamed al-Absi (blog), December 5 2016, accessed June 25, 2018,; Mohamed al-Absi “Document: Mechanism for the Purchase of Oil Company 50% of Shipments Merchants Sold to the Citizen at the Official Price,” Mohamed al-Absi (blog), June 28, 2016, accessed June 25, 2018,

[20] Refusal would consequently leave the importer and their fuel shipment stranded as well as faced with the daunting prospect of having to pay expensive demurrage costs. Other additional costs incurred once the fuel shipment is unloaded and ready to be sent out for distribution and sold on the local market include the payment of fees to Houthi officials in each Houthi-controlled governorate and Houthi forces manning the checkpoints that transportation trucks must pass through during the journey from Hudaydah port to the point of destination. Researcher conversation with a well-informed Yemen economic expert with a first-hand knowledge of the distribution of fuel and other commodities after being imported via Hudaydah port, June 2018.

[21] Private conversation with two different Yemeni economic experts with a detailed knowledge and understanding of Yemen’s oil and gas industries in December 2017 and January 2017; “UNVIM”; “United Nations Verification and Inspection Mechanism for Yemen: Update May 2016,” United Nations Verification and Inspection Mechanism, last modified May 2016, accessed June 15, 2018,

[22] Researcher interview with confidential source with close ties to CBY in Aden, June 2018. Marib, one of Yemen’s oil-producing regions, reached a deal in 2017 with the internationally recognized government allowing the governorate to keep a share of the revenues from oil produced in Marib. As of this writing, however, ongoing disputes between the CBY branch in Marib and the branch in Aden have meant that instead of transferring 80 percent of oil revenues to the Aden branch, the Marib branch has refused to transfer any.

[23] Peter Salisbury, Yemen’s Cratered Economy: Glimmers of Hope? (Washington, DC: Arab Gulf States Institute in Washington, 2018) accessed June 25, 2018,

[24] In 2016, then-CBY Governor Monasser al-Quaiti, ordered a total of YR400bn new banknotes, worth approximately $1.2bn at the time. In 2017, there were several separate shipments of Russian-printed Yemeni rials, presumably tied to the order placed by al-Quaiti. Rather than being deposited straight into the CBY in Aden, YR2bn was reportedly delivered straight to the presidential palace in the Masshiq area of Crater district, Aden. According to a source with close ties to the CBY in Aden, the majority of this Russian-printed money has now reportedly been disbursed via the office of Prime Minister Ahmed Obaid bin Dagher as “discretionary spending.”  The UAE supposedly grew increasingly frustrated with Hadi and the internationally recognized Yemeni government in 2015 over the lack of accountability over donor funds and government spending, to the point in which the UAE decided to limit the direct financial support it provided to Hadi.

[25] Researcher interview with confidential source with close ties to CBY in Aden, June 2018. See also: Salisbury, Yemen’s Cratered Economy.

[26] This particular accusation is what prompted Hadi to announce the relocation of the CBY headquarters from Sana’a to Aden and the dismissal of former CBY Governor Mohammed bin Hammam, see: Hadeel al-Sayegh, “Yemen President Names New Central Bank Governor, Moves HQ to Aden,” Reuters, last modified September 18, 2016, accessed May 23, 2018,

[27] Researcher interviews, Cairo, February and March 2018; Researcher WhatsApp conversation with an employee of the Houthi-controlled Ministry of Interior in Sana’a, in October, November, and December 2017.

[28] Researcher interviews, Cairo, February and March 2018; Researcher WhatsApp conversation with an employee of the Houthi-controlled Ministry of Interior in Sana’a, in October, November, and December 2017.

[29] This policy brief is meant to give policymakers an overview of the corruption mechanisms that have continued while the conflict rages. By the time it is published, some of those mechanisms are likely to have evolved further still.

[30] One example might be a policy to clamp down heavily on Yemen money exchangers/hawala networks due to concerns over the Houthis use of money exchangers to access foreign currency and pay exporters. Money transfer transactions are a critical lifeline for beleaguered citizens outside the commercial or political class. Regular citizens rely on remittance flows — the backbone of the money exchange system — to purchase essential commodities, including food and water. Any ill-considered disruption of these money flows may sever one of the few remaining lifelines for a broad subset of Yemenis whose interests are often ignored when discussing corruption-deterring measures.

Generating new employment opportunities in Yemen

Generating new employment opportunities in Yemen

Decades of political instability and cyclical armed conflict have curtailed Yemen’s economic growth, job creation and labor productivity. Before the current conflict, much of the country’s working population was engaged in unskilled labor, working in rural agriculture or informally employed in small businesses. More recently, the ongoing conflict has destroyed normal commerce and left millions of Yemenis without a means of supporting themselves or their families. Even those not directly affected by the fighting now face brutal economic hardship. The economic crisis has become the primary driver of what the United Nations has called the world’s largest humanitarian catastrophe. In the midst of this crisis, the need for job creation is paramount.

The Need to Build State Legitimacy in Yemen

The Need to Build State Legitimacy in Yemen

The ongoing conflict in Yemen has severely strained state legitimacy in the country. Legitimacy, a key component of state sovereignty, reflects a “social contract” between the state and the people it governs: an agreement on how power is exercised and how resources are distributed. A state’s legitimacy derives in part from its ability to deliver public services, ensure economic stability, and provide security. After three years of conflict, Yemen’s already fragile state institutions are unable to meet the most basic needs of the Yemeni people, intensifying the country’s economic and humanitarian crises.

The Sana’a Center for Strategic Studies is seeking a full-time editor

The Sana’a Center for Strategic Studies is seeking a full-time editor

The Sana’a Center for Strategic Studies is seeking a full-time editor. The Center’s editorial department is the hub between the center’s various programs, which currently examine the socioeconomic, political, security, gender, humanitarian, and human rights issues at play in Yemen.

As an editor you would work immediately under the chief editor and in close cooperation with senior management, researchers and writers. Primary duties would involve editing articles for publication and facilitating all aspects of the production cycle, from helping writers develop and structure ideas to posting finished articles online.  

We are a dynamic, highly mobile, multi-lingual team with diverse backgrounds and expertise. Our main office is in Sana’a, while the majority of our team works remotely from locations across Yemen, around the Middle East and in Western capitals. Among our core strengths are our versatility, initiative, access, networks, and audacity. We seek new team members who would complement this dynamic.


Absolute necessities:
  • Strong editorial experience;
  • a command of English that goes well beyond grammar and vocabulary;
  • an intuitive sense for how the arrangement of words impacts their reception and the ability to craft them appropriately for the audience at hand;
  • in editing others, you are able to identify and strip away the language habits, confusions and ego that often blur the message;
  • the ability to properly structure a sound argument at 5,000-words or more;
  • the ability to work remotely and travel periodically for Sana’a Center events; and
  • you are candid, poised and patient.
Preferable assets:
  • Arabic language skills, spoken and written;
  • previous experience related to Yemen and/or the surrounding region;
  • economic and financial literacy.
Starting salary:
  • Based on experience, and to be reviewed following a three-month trial period.

For those interested, please email with the following:

  • Your CV and a cover letter.
  • Three professional writing/editing samples.

All qualified applicants will receive consideration for employment without regard to race, color, religion, national origin, political affiliation, sex, gender identity, sexual orientation, marital status, disability or age.

Applications will be accepted on a rolling basis. We will contact only those candidates who meet the qualifications and seem like they may be a good fit for our team.

This job opening will close once a qualified candidate is found.  


More about the Sana’a Center:

Founded in 2014, the Sana’a Center is one of the few independent research centers that has continued to operate in Yemen throughout the ongoing armed conflict. While the Center maintains cordial relations with all key stakeholders it has remained fiercely unaligned with any of the belligerent parties. The Sana’a Center has thus maintained a unique positioning and ability to work throughout Yemen and beyond.

The Sana’a Center maintains a strong network across Yemen with access to key political, military and security figures, tribal leaders, the financial sector, economists, journalists, humanitarian actors, civil society and other important stakeholders. The Center has also established a broad network and presence within the international community connecting it to international organizations, diplomatic circles, regional and international policy makers, research centers and global forums.

The Sana’a Center’s reports and researchers are widely quoted in local, regional and international media outlets, while the analysis of the Center’s experts is regularly sought out by local and international stakeholders.

Challenges for Yemen’s Local Governance amid Conflict

Challenges for Yemen’s Local Governance amid Conflict

Local councils are among Yemen’s most important state institutions. Responsible for providing basic public services to millions of Yemenis, local councils represent official governance and the Yemeni state for much of the population. The intensification of the conflict between the internationally recognized government, its regional backers and the Houthi group since March 2015, however, has heavily impacted funding and security for local councils, undermining their ability to provide services effectively in most areas of the country.
In many areas, this absence of effective official governance has created fertile ground for non-state actors to exert their influence. In the areas under Houthi control, Houthi supporters closely monitor local council activity. In the southern coastal city of Aden, local councils are caught among competing armed militias that form part of a broader power struggle between southern secessionists and the internationally recognized Yemeni government.

An Institutional Framework for Post-Conflict Reconstruction in Yemen

An Institutional Framework for Post-Conflict Reconstruction in Yemen

Previous reconstruction efforts in Yemen following conflict or natural disaster have suffered from lack of coordination with and unrealistic expectations from international donors, as well as the Yemeni government’s limited capacity for aid absorption and project implementation; as a result, there was little tangible long-term impact.
In light of lessons learned from similar post-conflict contexts and Yemen’s own history of reconstruction efforts, this policy brief proposes an institutional structure for a future reconstruction process in Yemen: a permanent, independent, public reconstruction authority that empowers and coordinates the work of local reconstruction offices, established at the local level in areas affected by conflict or natural disasters. This proposal does not arise only from these lessons learned, but also from the immediate need for such an institution to begin planning and implementing reconstruction work to the greatest extent possible.

Increasing the Effectiveness of the Humanitarian Response in Yemen

Increasing the Effectiveness of the Humanitarian Response in Yemen

The second Development Champions Forum of the “Rethinking Yemen’s Economy” initiative recently brought together more than 20 of the leading socio-economic experts on Yemen to discuss the most critical challenges facing the country. Among the key topics included were the need to increase the coverage and efficiency of the campaign international humanitarian organizations and United Nations agencies are undertaking to address Yemen’s humanitarian crisis. Among the major issues the Development Champions identified during discussions were: