Introduction to Yemen Rural Development Policy Notes

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INTRODUCTION TO YEMEN RURAL DEVELOPMENT POLICY NOTES
This short note serves as an introduction to four policy notes on Yemen’s rural landscapes
and resiliency, rural institutions, the rural investment climate, and rural public expenditures.
The policy notes are the output of analytical work undertaken by the World Bank in 2013 and
2014 to support to the Government of Yemen in its efforts to stimulate sustainable economic
growth, reduce poverty, and promote shared prosperity in rural areas in the face of significant
social and environmental changes1.
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Scaling up Rural Development in Yemen, an Economic and Sector Work (ESW) study carried out by the
World Bank at the request of the Government of Yemen, consisted of analytical work on rural landscapes
and resiliency, mapping of rural institutions, rural investment climate assessment, and rural public
expenditure review. The development and execution of the ESW was undertaken in close consultation
with the Government of Yemen’s team, represented by the Ministry of Planning and International
Cooperation (MOPIC), led by H.E. Dr. Mohammed Al-Sadi, Minister, Dr. Abdulla Abdulaziz
Abdulmajeed, Deputy Minister of Planning and International Cooperation, and Mr. Khaled Saeed,
Director-General of Agriculture and Fisheries. The study team also worked with other stakeholders in
Yemen, including the Ministry of Agriculture and Irrigation (MAI), the Ministry of Water and
Environment (MWE), the Social Fund for Development (SFD), as well as other ministries, agencies, and
institutions in Yemen.
The World Bank team included: Kwaw Andam ([email protected]), Task Team Leader for the
ESW; Hanane Ahmed ([email protected]), primary author for the policy note on rural landscapes
and resiliency, working with a team including Erick C.M. Fernandes ([email protected]),
Jeffrey Richie from the University of Washington ([email protected]), and Ahmed Al-Wadaey
from the Sana’a University; Bryan Bruns ([email protected]), primary author for the
background paper on rural institutions, as a Rural Development Specialist consultant under the
Cooperative Program of the World Bank and the Food and Agriculture Organization of the United
Nations; Naotaka Sawada ([email protected]), primary author of the policy note on rural
investment climate, which benefited from an earlier review by Nabila Assaf; and Guido Rurangwa
([email protected]) was the primary author of the policy note on rural public expenditure
review, working with a team that included Amir Mokhtar Althibah and Mansour Rageh. The ESW policy
notes benefited from comments from the study team and other World Bank colleagues. Zakia Chummun
and Georgine Badou provided administrative support. In the World Bank office in Sana’a, Naif AbuLohom provided technical guidance, Samra Shaibani provided support with media events, and Fowzia
Yahya Musleh Al-Qobi and Nabila Al-Mutawakel helped arrange interviews and other activities.
The study also benefited from information and ideas from government officials and others interviewed in
Yemen, as well as comments from participants at a technical workshop held in Sana’a, Yemen, on
December 5, 2013, and the international conference on “Building Resilience for Food and Nutrition
Security” held in Addis Ababa, Ethiopia, from May 14-17 . The peer reviewers for the ESW were Mark
Austin, Helen Lackner (Consultant), Stephen D. Mink, Lorraine Ronchi, Ismael Sma (IFAD), and
Christopher Ward (Consultant). The ESW was carried out under the overall guidance of Steven N.
Schonberger, sector manager for water and agriculture in the World Bank’s Middle East and North Africa
Region. Ideas in the policy notes are offered as information and analysis for consideration, and do not
represent the official policy or recommendations of the World Bank or any other organization.
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local and central government, donors, and
the World Bank in planning development
interventions and policy reforms.
A. THE APPROACH
This work was motivated by the need to
improve coherence in addressing the
development of Yemen’s rural landscape by
identifying key knowledge gaps; to
acknowledge the important linkages
between agriculture, water, land, and food
security in Yemen and therefore the
possibilities for tackling multiple problems
with multi-sectoral interventions, as part of
the development of the new country strategy
for engagement with the World Bank; to
apply existing diagnostic tools to test key
hypotheses about future directions for
Yemen’s development, especially in light of
the ongoing political transition in the
country; and lastly, to target public
financing to meet funding gaps in rural
development. Although the Yemen has
developed strategies covering areas such as
agriculture, water, fisheries, food security,
and roads, the last Rural/Local Development
Strategy (2003/2004) was developed in
2003, and since then there has been no
update of a comprehensive rural strategy per
se. Therefore the outputs from this work
provide the key elements for an updated
comprehensive agenda for scaling up and
implementing rural development
interventions in Yemen.
B. THE CONTEXT
Accelerated economic growth in Yemen’s
rural areas is critical to reducing poverty and
improving food and nutrition security.
Yemen, with a population of 25 million, is
one of the poorest countries in the world.
About 68 percent of the population lives in
rural areas where the poverty rate is about
40 percent compared to 20 percent in urban
areas. The country ranks 160 out of 187
countries in the 2013 Human Development
Index, it is among the ten countries in the
world with the highest rates of food
insecurity, and it has the third highest level
of malnutrition in the world.
Yemen is also undergoing a socio-political
transition that continues to exert significant
effects on its development trajectory.
Yemen experienced far-reaching unrest in
2011. During this period of crisis, the
economy contracted by 10.5 percent and the
number of people living below the poverty
line is estimated to have increased from
about 42 percent to 50 percent of the
Yemeni population. In the aftermath,
Yemenis elected a transitional president, and
the transitional government launched a
National Dialogue Conference (NDC) to
define the form of the new Yemen and pave
the way for a new constitution and elections.
The NDC closed in early 2014 with an
agreement to move from a centralized
government to a federated state with six
regions. However, Yemen continues to
experience tensions from social, security,
and political crises, caused in part by poor
economic performance and lack of progress
in human development.
In the long-term, the outputs from this work
will contribute to the World Bank’s twin
goals of eliminating extreme poverty by
2030 and boosting shared prosperity,
measured as the income of the bottom 40
percent in any given country. In Yemen, the
available data indicate that any efforts to
meet these goals will need to focus on the
needs of the poor and vulnerable in rural
areas and address the rural-urban disparities
in poverty and human development. This
study contributes to the achievement of the
twin goals by providing the analytical
support for decision-making to be used by
Besides its extractive oil industry, Yemen is
particularly reliant on agriculture. Yemen’s
diverse agro-ecological zones include
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highlands, plateaus, deserts, and sea coasts.
Agriculture is a key sector in the Yemeni
economy, and provides a main source of
employment for 54% of the population.
Agriculture produced 19.5% of Yemen’s
GDP in 2012.
C. THE POLICY NOTES
The landscape and resiliency analysis
policy note anchors the overall study by
generating insights about two key aspects of
rural Yemen: the natural resource base and
the livelihood strategies of vulnerable rural
households in rain-fed areas. The study finds
two key constraints for rural development:
the existing constraints on water are further
exacerbated by the expansion of qat and
other irrigated crops, and migration of males
from rain-fed areas is threatening the
existing coping mechanisms (such as terrace
construction and maintenance).
Rural development faces severe constraints
in terms of the natural resource base – land,
livestock, water, and fish stocks. Only 3% of
Yemen’s land area is considered suitable for
cultivation, and with shrinking plot sizes
averaging less than 1 ha. About 48 percent
of rural households sell livestock and
livestock products, and livestock serve as a
source of savings for the rural poor.
However, the lack of a well-functioning
animal health system is a major constraint to
livestock production. In terms of water
resources, Yemen is one of the most waterscarce countries in the world, with only
about 120 cubic meters (m³) of renewable
internal freshwater resources available per
capita. The country relies primarily on
groundwater for its water supply and, as a
result, annual groundwater withdrawal has
exceeded recharge rates. The rate of
groundwater extraction is particularly high
in the highlands, which sees annual declines
in the water table of 2 to 6 meters. In coastal
zones, over-extraction of groundwater has
led to salt water intrusion. In 2007,
agriculture accounted for over 88 percent of
total water withdrawals. Yemen is also
particularly vulnerable to climate change.
Climate change in Yemen is expected to
increase the variability and intensity of
rainfall, resulting in increased flood risks
and increased aridity. In the fisheries sector,
although hard statistics are not available,
recent figures on number of boats and
catches suggest that although there is a
potential for increasing fish exports, there
may be over-fishing and decline in fish
stocks.
Households’ livelihood strategies tend to be
constrained by the characteristics of formal
and informal institutions and the services
provided by those institutions. Therefore,
the rural institutions policy note provides
further insights on the characteristics of
institutional players in rural Yemen. That
study confirms that Yemen’s rural
institutions offer a strong mechanism for
participatory development, community
management of natural resources, and
decentralized governance.
The rural investment climate policy note
provides a summary of the constraints and
opportunities for promoting farm-based and
off-farm business in rural Yemen, to
strengthen the private sector in its role of
transforming livelihoods, the rural economy,
and ultimately the national economy.
The rural public expenditure review
provides further recommendations for
strengthening the rural economy, through
improved public spending. Better targeting
of public expenditures in rural areas can
address some of the challenges to private
sector investment that can be addressed by
public financing for public goods such as
power, infrastructure, and services (such as
water supply).
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