Attacks leave Yemen's economy on edge of collapse

  • Article by: SUDARSAN RAGHAVAN , Washington Post
  • Updated: July 2, 2011 - 6:46 PM

Electricity and oil shortages have added to the suffering of civilians -- which some fear could drive disaffected youths toward militancy.

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FILE - In this photo taken Friday, April 29, 2011, Yemeni President Ali Abdullah Saleh, center, waves to his supporters during a rally in Sanaa, Yemen. Saleh, who was taken to a military hospital in the Saudi capital, Riyadh, underwent successful surgery on his chest to remove jagged pieces of wood that splintered from a mosque pulpit when his compound was hit by rockets on Friday, said medical officials and a Yemeni diplomat.

Photo: Muhammed Muheisen, Associated Press - Ap

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SANAA, YEMEN - Over months of political turmoil, attacks on electricity plants and oil pipelines have left Yemen's economy on the edge of collapse, with the most damaging strike carried out in retaliation for a U.S. counterterrorism raid.

Against a backdrop of street protests and military clashes, the country is grappling with electricity blackouts, rising food prices, and fuel shortages so dire that ordinary Yemenis can spend days in lines for gasoline.

In March, tribesmen blew up the main pipeline in Marib Province, the birthplace of the Queen of Sheba and home to about half of Yemen's oil reserves. The attack was carried out by a powerful tribal leader, Ali al-Shabwani, whose son was killed in a U.S. airstrike in May 2010.

The pipeline helps funnel crude to the nation's main oil terminal in the southern port city of Aden for export and to be refined into gasoline. With Yemen bogged down in a popular uprising, the pipeline remains ruptured, with Shabwani and his heavily armed tribesmen refusing to allow the government access to the site until he gets justice for the airstrike.

Water shortages, soaring costs

Around Sanaa, a sprawling, dun-colored capital nestled among jagged mountains, the consequences are apparent, including water shortages, high transportation costs and soaring food prices. Forty percent of the nation's population lives on less than $2 a day.

Lines stretch for miles at gas stations that sell fuel at government-subsidized prices. On the black market, fuel costs three times as much. At some gas stations, gunfights have erupted.

"Yes, [Shabwani] has suffered from the airstrike, but how can he make all the people suffer?" said Yahya Saleh Mohammed, 27, an accountant. He had been waiting in line for gas for two days and was still a mile from the gas station.

Many restaurants and stores are shuttered. Beggars have multiplied. At night, large portions of Sanaa are enveloped in darkness; electricity is available only for a few hours a day. The attacks on power plants and pipelines have continued, carried out from both sides of a widening political divide.

Seen through prism of politics

"Initially, these were anti-government tribes who wanted to place pressure on the regime," said Adil Abdul Ghani, an official in the Electricity Ministry. "Now, however, they are pro-government ones attacking the plants because they want to show that the state cannot function without Ali Abdullah Saleh," the president.

The contributing role of the U.S. airstrike in the fuel shortage is an indication of the growing fragility of Yemen's economy during the five-month-old revolt.

It also highlights the potential for U.S. policies to have harmful, if unintended, consequences in this politically brittle nation, where Washington has stepped up counterterrorism activities in recent months, with plans for the CIA to work closely with the U.S. Joint Special Operations Command in carrying out attacks with armed unmanned aircraft.

Many Yemenis also view the economic crisis through the prism of politics, blaming the government or the opposition for their woes. That, many analysts and diplomats fear, could spawn more unrest; rising unemployment and poverty could drive disaffected youths toward militancy at a time when Al-Qaida in the Arabian Peninsula and other Islamist extremist groups are trying to take advantage of Yemen's political vacuum.

"Everybody is lost," said Saif al-Asali, a former finance minister. "And the politicians on both sides don't seem to care what happens to the people."

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