It might seem premature to discuss reconstruction as the war in Yemen drags on, with many actors on the ground seeing no end in sight. However, several key decision-makers, including Saudi Arabia and the Gulf Cooperation Council, are already discussing post-war strategies for reconstruction and recovery in Yemen. It is valuable then to discuss some policies that could facilitate rebuilding Yemen’s fractured economy, with an eye toward the future and the cessation of hostilities, but including those that could help the economy even before the conflict has ended.
As the crisis in Yemen approaches its fifth year, wartime economic opportunities have entrenched themselves in the political economy of Yemen. As long as they exist, these economic opportunities represent disincentives to negotiation for the same powerful parties whose buy-in is essential for a peaceful resolution to the war.
In a Chatham House article, Yemen expert Peter Salisbury warns that the flourishing war economy that sustains militia leaders, the Hadi government, and local stakeholders poses a threat to a diplomatic solution. Militia and political leaders fund their war efforts by taxing or establishing monopolies on resources. War has empowered militia leaders on all sides, and a peace process would strip these groups of their main source of authority.