Where will Yemen’s aid money go?

Analysis: Where will Yemen’s aid money go?

Donors have pledged funds for humanitarian and reconstruction work, but it’s not clear how the money will be channeled
Donors have pledged billions of dollars
But unclear where the money is going
Funding for humanitarian needs is lagging
Government absorption capacity is limited
NGOs want to play a larger role

DUBAI, 28 September 2012 (IRIN) - With billions of aid dollars set to pour into Yemen, humanitarian agencies are calling for greater transparency in its allocation, warning that not enough of the funds appear designated for the country’s dire humanitarian situation.

At a meeting of the so-called Friends of Yemen grouping of countries in New York yesterday, donors pledged $1.5 billion for Yemen, in addition to $6.4 billion raised at a conference in Saudi Arabia earlier this month.

But despite all the money floating around, a UN appeal for funds to address urgent humanitarian needs in Yemen remains less than half met.

The shortfall - just under $300 million - amounts to less than 4 percent of the total funds allocated in the two meetings, but donors are more focused on the political, security and macro-developmental needs rather than humanitarian issues, aid workers say.

“There needs to be the right balance,” Peter Rice, coordinator of the INGO Forum, an advocacy group that represents more than 50 international NGOs in Yemen, told IRIN. “The humanitarian situation changed a lot during the course of 2011. If the considerable humanitarian needs are not addressed, Yemen’s development in the long term will be severely affected.”

More than half the Yemeni population - 12 million people - do not know where their next meal is coming from. One million children are severely malnourished, and more than half a million people are displaced by separate conflicts in the north and south of the country. Poverty is on the rise, measles and polio have resurged, and more than 12 million people do not have consistent access to safe drinking water. Yemen is also home to a quarter of a million refugees.

In a joint statement released on 27 September, eight NGOs working in Yemen said: “There is no reason for an underfunded humanitarian response.”

Some point to the futility of long-term development programmes in the midst of crisis. “You can never develop or educate someone when they are hungry,” said Awssan Kamal, head of advocacy at the Yemen Relief and Development Forum (YRDF), an umbrella charity set up by Yemenis in the UK.

Others say the crisis could jeopardize the entire transition process.

“If we don’t address and tackle the humanitarian and economic crisis today, there will be no political stability,” Ismail Ould Cheikh Ahmed, the UN’s humanitarian coordinator in Yemen, told IRIN.

Delivering on promises

In 2011, insecurity and a lack of access limited the work of UN agencies and international NGOs, but this year, they have scaled up their presence across the country. Now, they say they are mostly limited by a lack of funds.

Qatar’s pledge of $500 million in New York is reportedly for humanitarian work. Similarly, donors at the Riyadh conference pledged $647 million for “urgent humanitarian and reconstruction needs,” but neither have yet defined how they will allocate that money, or whether it will be channelled through the UN and its partners.

“It is clearly marked who has pledged what. But where that money specifically is going is less clear,” Colette Fearon, Oxfam’s director in Yemen, told IRIN. “We’d very much like to see that transferred transparently so that we know what it is for… What is humanitarian? What is longer-term? Who are the funds allocated to? Who is running the projects?”

Photo: Lindsay Mackenzie/IRIN
Half the Yemeni population does not have secure access to food

Some of those funds could be destined for NGOs from the Gulf, like Qatar Charity and the Khalifa bin Zayed Al Nahyan Humanitarian Foundation, which are operating in Yemen without coordination with the UN.

But aid workers are quick to point out that in 2006, donors promised $5 billion to Yemen; by 2010, they had disbursed less than 10 percent of it.

“It all seems like it is skeleton planning at the moment,” Kamal told IRIN. “This is our main concern. We have this huge sum – $7.9 billion – and no one really knows where it’s going. The Riyadh conference was considered a success because of the pledges. But it’s about delivering on these promises.”

Government capacity

Part of the push to allocate aid money to UN and NGO actors is a response to the poor capacity of the new government, formed in February after a power transfer deal replaced former President Ali Abdullah Saleh. Government expenditure contracted significantly in 2011, amid a year of anti-government protests and violent clashes.

Now, the Ministry of Planning and International Cooperation does have a vision on how to spend aid money, as laid out in its 2012-2014 Transitional Program for Stabilization and Development (TPSD), which has a clear humanitarian pillar, and the Project Investment Program.

Of the $14.9 billion it needs to carry out these programs, including $4.7 billion in the immediate short-term, the Yemeni government says it has a total funding gap of about $11.9 billion.

While multi-year pledges by several donors have helped relieve the pressure to spend quickly, the government recognizes its own historical inability to absorb and spend that scale of financing.

“Despite a significant flow of external resources into Yemen’s development efforts over the years - the country has not been able to optimize the gains from development cooperation,” said a Ministry of Planning and International Cooperation document analyzing its absorption capacity.

The document points to several reasons: weak administrative, procurement and financial systems; an inability to attract and retain quality staff; a lack of coordination within the Yemeni government; a lack of predictability in aid flows; and a lack of donor alignment with government priorities.

The structural damage incurred during last year’s uprising does not help.

“This is going to be an enormous challenge,” April Alley, a senior analyst with the International Crisis Group, told IRIN. “The government is deeply divided. What little bureaucratic capacity they have has been hampered further by the fact that some ministries are in shambles – literally in shambles from the previous fighting with many buildings destroyed, computers stolen and offices looted. Also civil servants are being changed and rotated, often for political reasons. The absorptive capacity problems that existed under Saleh are likely to be augmented in the current political environment.”

According to Wael Zakout, the World Bank’s director in Yemen, the government has been fairly successful at running small-scale relief programmes, like the Social Fund for Development and the Rural Access Improvement Program.

''Before we keep pumping aid, we should build the capacity of the government and make sure it is more transparent so that the money can actually reach the people it is intended for.''

Where it has struggled, he said, is in large infrastructure projects, like big roads or power stations. The World Bank is trying to help the government “put their house in order,” as Zakout put it, by developing mechanisms that would speed up the design and tender stage and remove bottlenecks in implementation.


The new government has also vowed to root out corruption and patronage payments that were common under the old regime. For the first time, it has signed a mutual accountability framework with donors, which lays out a plan to monitor the implementation of funding, and it has committed to establishing an anti-corruption court and a vetting system for senior appointments.

“They have the willingness to do it. Whether they have the capacity to do it, I’m not sure,” Zakout told IRIN. “But with the support of the international community and continuous, consistent engagement with them, the likelihood is it will happen.”

Others are more cynical.

"We have a corrupt government that lacks the capacity to handle large amounts of aid,” Atiaf al-Wazir, a Yemeni blogger and development consultant, recently told a group gathering in the Yemeni capital Sana’a to discuss whether foreign aid was good for Yemen. “Before we keep pumping aid, we should build the capacity of the government and make sure it is more transparent so that the money can actually reach the people it is intended for."

Role of civil society

One suggestion coming out of the Riyadh conference, and welcomed by the Yemeni leadership, was an international fund through which aid money could be channelled to prevent corruption. Activists said Yemeni civil society should also have a role in developing and monitoring accountability mechanisms.

They would also like more of a role in aid delivery.

Until now, donors have been slow to fund Yemeni NGOs because “they have no capacity to spend such funds”, Hany El-Banna, president of the Humanitarian Forum, told a recent conference in Kuwait. The Humanitarian Forum aims to improve dialogue between aid agencies in the Muslim world and their counterparts in the multilateral system.

More of the current aid flow should be directed towards strengthening Yemen’s 6,000 or so registered NGOs by training them in humanitarian principles and codes of conduct, as well as in project management, financial accounting, and monitoring and evaluation, several civil society advocates said.

This would allow them to play more of a role in the delivery of aid, especially in insecure, remote or tribally controlled areas that are inaccessible to government or aid agencies. It would also contribute to national reconciliation by empowering regular people to be part of Yemen’s transition, said Kamal of the YRDF.

“Yes, there is this concern over capacity, but… we do have some organizations that have some capacity and with minuscule amount of training can deliver great programmes.

“How we go forward is very important,” he said. “Now is the time to enable Yemenis to deliver humanitarian response.”