Yemen: World Bank Approves Four Year Country Assistance Strategy (CAS)

Contacts
In Washington: Dina El Naggar (202) 473-3245
Delnaggar@worldbank.org

In Sana’a:  Samra Shaibani (967-1) 413-710

Sshaibani@worldbank.org

WASHINGTON, June 15, 2006 – The World Bank Board of Directors today discussed the 2006-2009 Country Assistance Strategy (CAS) for Yemen. This CAS was prepared after extensive consultations with central and local government officials, civil society, private sector and donors. It also benefited from the Government’s Progress Report for the first two years of implementation of the First Poverty Reduction Strategy Paper (2003-2005) as well as the 2006 Country Assistance Evaluation prepared by the Independent Evaluation Group of the World Bank.  “The new CAS builds upon the rich lessons of experience that were drawn from the implementation of the Government and Bank programs”, commented Emmanuel Mbi, Country Director for Egypt, Yemen and Djibouti.

Yemen represents the single largest development challenge in the Middle East and North Africa region.  It is endowed with limited resources notably scarce water, limited arable land and declining oil reserves.  Over 40 percent of the population is poor, nearly 50 percent of its population is below 15 years and population expected to double in the next 20 years.  Yemen made limited economic and social progress over the period of implementing its First PRSP (2003-2005).  The situation has begun to slowly improve with the re-commencement of economic reforms in July 2005, the formulation and early implementation of the National Agenda for Reform in 2006 and the rejuvenation of discussions for regional integration with neighboring countries and associated funding to develop the institutions, infrastructure and human capacities for such integration.  “As we move jointly to implement the new CAS, governance will be a key focus for Yemen in the short term to ensure long-term development effectiveness,” stated Mustapha Rouis, Yemen Country Manager.

The new CAS will provide assistance based on four pillars:  increasing non-oil growth; improving human development outcomes; improving fiscal sustainability; and addressing the resource sustainability crisis.  The CAS would provide about $400 million in IDA credits to Yemen through a selective program of lending operations as well as a strategic program of analytical and learning services.  “Given the limited amount of IDA resources available to Yemen, the World Bank’s larger contribution will come from its catalytic role in leveraging donors’ resources, providing technical assistance to the Government and working with other donors to mainstream new implementation approaches that can enhance sectoral performance,” said Gaiv Tata, World Bank Task Team Leader for the Yemen CAS.

As part of the new CAS, the International Finance Corporation (IFC), the private sector arm of the World Bank Group, will continue to support the development of the private sector in Yemen through investments and technical assistance activities. The IFC will focus on enhancing competitiveness of the private sector, further deepening the financial sector, promoting investments in areas newly opened for private sector participation, encouraging sustainable social and environmental development, and promoting good corporate governance.

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For more information about the World Bank’s work in Yemen, visit www.worldbank.org/ye

For more information about this project, visit www.worldbank.org/projects