Yemen Six Month Economic Analysis. Econonic Warfare & the Humanitarian Context

An inclusive political solution to the conflict is unlikely in the next six months, despite the high possibility of state economic collapse and a metastasizing humanitarian crisis across the country. President Hadi’s refusal to accept the terms of a recent UN peace plan is likely stalling Saudi financial relief and threatens to fracture his support base in the south. Meanwhile, the crippled state economy is supporting a thriving shadow economy, which will fragment power structures on both sides of the conflict as stakeholders engage in war profiteering. Not only will this diminish the chances for unity in the long run, it also increases food insecurity and poverty for the most vulnerable, while benefiting those in power who already dominate the parallel market. Amidst this turmoil, AQAP and IS influence will increase. This report will examine the economic context affecting humanitarian needs in Yemen, and present scenarios offering potential trajectories of the conflict to assist in humanitarian preparedness.