Divergent Saudi-Emirati Agendas Cripple Yemen’s Presidential Leadership Council

The Arab Center Washington DC - Two years into its existence, Yemen’s Presidential Leadership Council (PLC) still has not effectively addressed critical problems facing the country: a dire economic situation, an enduring Houthi threat, and escalating military tensions in the Red Sea. In particular, the PLC’s obvious inability to prevent the Houthis from attacking maritime traffic in the Red Sea signifies its profound ineffectiveness, raising concerns about whether it can fulfill its mandate of governing the Yemeni polity. The fundamental reason for the PLC’s dysfunction, however, rests today in the divergent approaches and lack of harmony between its main backers, the Kingdom of Saudi Arabia (KSA) and the United Arab Emirates (UAE), which hinder unified leadership and decision-making within the council and perpetuate its state of paralysis.

Divergent Saudi and Emirati Approaches

The PLC was established in April 2022 with a dual mandate: to lead the internationally recognized government of Yemen and to unify anti-Houthi factions against their common adversary. The eight-member council is chaired by former interior minister and deputy prime minister Rashad al-Alimi. The UAE and KSA are the PLC’s main backers, but their different agendas and approaches constrain the council’s operations.

First, the two countries support different members within the PLC and do not treat it as a unified entity. The UAE provides support to four members on the council: Aidarous al-Zubaidi, Tareq Saleh, Faraj al-Bahsani, and Abdulrahman al-Mahrami. Al-Zubaidi heads the Southern Transitional Council (STC), a secessionist body calling for the reestablishment of the erstwhile state of South Yemen (formerly named the People’s Democratic Republic of Yemen). The STC’s membership in the PLC is troubling and directly contradicts the council’s primary mandate to unify and strengthen the state. The UAE also provides military support to Saleh, a nephew of former president Ali Abdullah Saleh; to al-Bahsani, former governor of Hadramawt; and to al-Mahrami, a commander of the Southern Giants Brigade forces. For its part, Saudi Arabia supports Sultan Ali al-Arada, Governor of Marib and member of the Saudi-backed Islah Party, and Abdullah al-Alimi, who was the director of former President Abdrabbuh Mansur Hadi’s office and belongs to the Islah Party.

Second, Riyadh and Abu Dhabi avoided setting a clear mandate for the PLC president’s powers and privileges. This allowed each member to remain basically free to have his own agenda and preserve his independence. This has led to a paralyzed leadership and in fact further fragmented state institutions. The entrenched rivalry between PLC factions makes it nearly impossible to forge a clear vision for Yemen’s future or to implement coordinated strategies.

Third, the PLC lacks a unified military force. Each member of the council effectively controls his own military unit, and some units have more power than the council president. For example, al-Zubaidi, the most powerful member, commands stronger forces than even the PLC president. STC-affiliated forces have seized the presidential palace in Aden multiple times. Efforts to merge these forces under the ministries of defense and interior have failed.

The fragmentation within the PLC and Saudi Arabia and the UAE’s divergent agendas are also evident in other areas. Riyadh supported the formation of the Hadramawt National Council, ostensibly as a competitor to the STC. It also helped PLC President Alimi in establishing the Nation’s Shield Force as a unified military formation encompassing many units loyal to the PLC that would counter the UAE-backed STC and its Security Belt forces. Only time will tell, but the proliferation of political formations could encourage conflicting loyalties and rivalries that in turn could fuel the very military fragmentation that the PLC is trying to arrest.

Amid the growing rivalry between Saudi Arabia and the UAE, media reports show that tensions between Saudi- and UAE-backed forces have escalated in parts of the east and south of the country, leading to near-armed confrontations between opposing forces. Such incidents include UAE-backed forces taking control of key military positions in Socotra—a small archipelago of Yemeni islands in the Arabian Sea—adjacent to Saudi-supported forces. Additionally, the STC’s sharing of revenue sources, such as customs and taxes with the government in Aden, has raised concerns about who is in control of the country’s finances. The divergent UAE-Saudi approaches also contributed to deepening security troubles and tribal clashes in provinces such as Shabwa. The UAE-backed STC has intensified its efforts to dislodge forces loyal to the PLC.

The PLC’s Ineffectiveness in Addressing the Red Sea Crisis

The impact of Saudi-Emirati divergence was evident in the council’s weak stance toward the Red Sea crisis and the attacks by the Houthi armed group. Despite the significant threat posed by the Houthis to Red Sea shipping lanes since October 2023, the PLC as a unified entity has been ineffective in exerting influence there. This was particularly apparent when the Houthis extended their control over the airspace within the PLC’s jurisdiction, disrupting international flights at airports managed by the council. Houthi forces recently blocked a UN plane from landing in Yemen’s Marib province, controlled by the PLC. This incident at Marib followed another situation two days earlier, in which the Houthis prevented a Sudanese civilian plane carrying Yemenis from Port Sudan from landing in the same area.

The US-led Operation Prosperity Guardian airstrikes on Houthi targets in Yemen also highlighted the PLC’s inability to assert sovereignty. In 2015, the Saudi-led coalition launched its military campaign against the Houthis after President Hadi appealed for support, coordinating efforts with the national army. But during Operation Prosperity Guardian, the United States conducted airstrikes independently, without PLC coordination or approval, demonstrating the PLC’s lack of control over Yemeni territory and diminished global influence.

In response to these challenges, instead of capitalizing on the international focus on Houthi strongholds to strengthen its position, the fractured leadership within the PLC undermined its ability to forge a unified strategy. Council members pursued disparate strategies, each seeking separate military support from the United States and the United Kingdom, which only served to emphasize the lack of a cohesive strategy and further fragmented the council’s response. Vice-chair of the PLC and STC President Al-Zubaidi and PLC member Tareq Saleh, each called for Western help in building up their naval forces to defeat the Houthis. This disunity has not only prevented the PLC from exploiting potential strategic openings but also has significantly weakened its ability to present a united front in the Red Sea conflict, which has exacerbated the crisis.

The Houthis’ continued ability to challenge international interests, combined with the PLC’s failure to assert authority over sea and air, demonstrates a profound governance and leadership failure. The PLC’s ongoing ineffectiveness in addressing external threats and coordinating with major international actors continues to erode its credibility and operational capacity.

The US Position on the PLC’s Divergent Agendas

The United States has not publicly criticized Saudi Arabia and the UAE for supporting competing military and political factions operating outside the control of Yemen’s internationally recognized government. The United States views the PLC as one of many factions that is ineffective in addressing crises. This perception of ineffectiveness also dates back to Yemen’s previous governments. Since 2015, Washington has not condemned the Saudi-led coalition for insufficiently supporting the Yemeni Army in its war against the Houthis. Similarly, the United States took no action when the UAE killed 30 Yemeni soldiers in airstrikes during infighting between government forces and the UAE-backed Southern Transitional Council in Aden. Hadi had previously accused the UAE of behaving like an occupier in the country, rather than as a liberator.

As the PLC weakens and the Houthis grow stronger, the United States now recognizes the need for a more effective council to protect its regional interests, particularly regarding military bases and personnel in neighboring countries. So the US government began making a shift in its strategic priorities in Yemen. It began to take a firmer stance against the Houthis, reclassifying them as a Specially Designated Global Terrorist (SDGT) and linking a peace deal in Yemen with the group ending its Red Sea attacks. Both Riyadh and Abu Dhabi declined to participate in Operation Prosperity Guardian due to concerns about retaliatory Houthi attacks like those on Saudi Arabia and the UAE in 2022. Despite the lack of Gulf allies’ involvement (save Bahrain), Operation Prosperity Guardian demonstrates Washington’s willingness to lead independently. Although the United States now takes a firm stance against the Houthis, it continues to overlook the driving factors empowering them: the divergent approaches of Saudi Arabia and the UAE and the inherent flaws in the PLC.

The United States Can Play a Constructive Role

A first step that the United States can take to help end the Houthi threat in the Red Sea is to prioritize diplomatic efforts to end Israel’s war on Gaza. Washington should also promote stability in Yemen pressuring its Saudi and Emirati allies to harmonize their strategies within the country. Effective US mediation is crucial considering Washington’s strategic relationship with both Gulf countries and the United States’ ability to foster cooperation between them. While the two countries are intimately involved in many aspects of Yemeni affairs, coordinating their approaches can help forge a unified political and military structure under the PLC.

Given the UAE’s resistance to making compromises in its Yemen policy, compared to Saudi Arabia’s willingness to negotiate, US efforts should focus on mitigating the UAE’s obstructive role. This can be achieved by supporting the PLC in enhancing its authority and effectiveness through technical assistance, capacity-building, and diplomatic efforts aimed at unifying its decision-making processes.

Finally, it is important to emphasize that helping the PLC and strengthening its position vis-à-vis other actors in Yemen must be accompanied by efforts to preserve the council’s autonomy. Yemenis have long suffered from external interference in their affairs, mostly at their own expense. Therefore, any interference or strategy must carefully balance the benefits of external support with the preservation of Yemeni sovereignty and self-determination.

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*This policy analysis paper was written for & published first on the Arab Center Washington DC website. 

Instead of Houthi Designation, the United States Should Embrace a Comprehensive Approach

Arab Center Washington DC -  On January 17, the United States designated the Houthis in Yemen, also known as Ansar Allah, as a Specially Designated Global Terrorist (SDGT) in response to the armed group’s missile and drone attacks on American and international commercial vessels traveling off Yemen’s Red Sea coastline. The designation took effect on February 16. In a show of solidarity with the Palestinian people, the Houthis vowed to retaliate against Israel until it ends its war on Gaza by attacking and hijacking ships that the group claims are connected to Israel, although many of the targeted vessels have no Israeli ties and some are even carrying humanitarian aid for Yemen. Along with the terrorist designation, since December the United States has led an international military operation entitled Operation Prosperity Guardian and has conducted airstrikes on Houthi military targets in Yemen. In February, the European Union followed suit and initiated a naval force operation, named Aspides, to protect Red Sea commercial vessels from Houthi attacks.

The United States asserts that the designation’s main aim is to obstruct terrorist funding for the Houthis and to restrict their access to financial markets without harming the people of Yemen, as Washington has provided allowances in the designation for humanitarian organizations to deliver essential aid. Despite this assurance, however, the US move has raised concerns about negative repercussions on Yemen’s humanitarian and economic situation. “We fear there may be an effect on the economy, including commercial imports of essential items on which the people of Yemen depend on more than ever,” warned the United Nations Office for the Coordination of Humanitarian Affairs.

The designation aims to exert pressure on the Houthis, but it appears incongruent with the group’s operational structure—they have very limited financial connections to the United States—and thus is unlikely to impede its activities. Indeed, the Houthis operate with localized and unconventional funding sources, do not rely on the global market, and remain isolated from their neighbors and the international community, except for Iran. Thus, the decision to label the Houthis as a terrorist group is unlikely to achieve its intended objectives—and may have a severe negative impact on the Yemeni population, especially by restricting the import of essential commercial items.

Reasons Behind the Houthi Designation

Concern about such ramifications were the main reason why the Biden administration, just weeks after taking office, reversed the Trump administration’s January 2021 designation of the Houthis as a “Foreign Terrorist Organization” (FTO) and as a SDGT. The Trump administration had stated that its move aimed “to hold Ansar Allah accountable for its terrorist acts, including cross-border attacks threatening civilian populations, infrastructure, and commercial shipping.” The designation came during a period of close US ties with Saudi Arabia and the United Arab Emirates (UAE), who had pushed Washington to designate the Houthis. After the Houthis escalated their attacks on Saudi Arabia and the UAE, Trump sought to please his Gulf allies. The Trump administration announced the designation following its “maximum pressure” campaign against Houthi-backer Iran that resulted in almost weekly sanctions against the Islamic Republic.

Significant developments followed Biden’s February 2021 delisting, including resumed diplomatic relations between Iran and Saudi Arabia in March 2023 and a notable reduction of hostilities between the Houthis and Saudi Arabia and the UAE. Most recently, the Houthis became involved in the war on Gaza as part of the Axis of Resistance, which also includes Lebanon’s Hezbollah and Iraq’s pro-Iran militias. While the Houthi group sees direct confrontation with the United States—and Israel—as a religious duty, the United States wants to punish it for attacking US military forces and international commercial vessels in the Red Sea. Since November, the Houthis have attacked at least 45 ships, leading to a surge of approximately 250 percent in shipping costs and pushing 70 percent of cargo ships to avoid the area.

The Biden administration justifies its designation as an effort “to impede terrorist funding to the Houthis, further restrict their access to financial markets, and hold them accountable for their actions.” But the move’s efficacy is questionable. The Houthis derive income not from international sources but from exploiting the Yemeni population by imposing unjust taxes on companies and individuals in the areas they control without providing public services and by seizing private property—including land, real estate, and funds—without compensation. Houthis also rely on smuggled advanced weapons from Iran. Since 2015, the Houthi forces have received Iranian-made anti-ship missiles and other advanced weaponry, significantly enhancing their maritime threat in the Red Sea.

The Biden administration’s assertion that it will “immediately reevaluate” the terrorist designation if the Houthis cease their Red Sea shipping attacks suggests an acknowledgment that its approach may not be sustainable because it may not effectively address the complex challenges posed by the Houthis.

How the Designation Works

The designation is typically carried out by the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) under various executive orders and laws. When an individual or group is designated as an SDGT, it translates to a freeze on their assets within US jurisdiction, accompanied by a general prohibition on US citizens engaging in transactions with it. Beyond the financial ramifications, the designation serves as a public condemnation of those implicated in acts of terrorism and as a crucial component of a broader strategy aimed at disrupting networks involved in terrorist financing.

The SDGT designation will have an impact on aid organizations, the private sector, and the peacebuilding process in areas under Houthi control. The designation could prevent numerous nonprofit groups, humanitarian aid organizations, private companies, and individuals located in Houthi-controlled regions who have dealings with the Houthi authorities from implementing their programs. In a February 5 statement, a coalition of international humanitarian organizations providing much-needed aid to Yemeni civilians expressed concern that major import suppliers and financial institutions will not be able to continue their work in Yemen, cautioning that the designation “will likely already contribute to the complex operating environment” in the country.

In addition, the designation is expected to exacerbate the already significant challenges posed by the interference of warring parties in the distribution of humanitarian aid in Yemen. Furthermore, local media reports say that the money transfer company Western Union has suspended its operation in Yemen as a result of the designation. Finally, the designation could create significant challenges for external mediators participating in peace negotiations with the Houthis. This is because the designation criminalizes the provision of any property or service, including expert advice or assistance, to designated organizations, thus hindering the ability of mediators to contribute effectively to the peace process.

Despite the designation and the Operation Prosperity Guardian attacks, the Houthis are persisting in their activities undeterred. US officials, in outlining plans to curtail Houthi capabilities and secure the Red Sea, have asserted that US strikes have damaged or destroyed nearly one-third of the Houthis’ offensive capacities. Despite this, the Armed Conflict Location and Event Data Project (ACLED) reports that the Houthis launched 21 attacks on international shipping last month.

The Houthis are leveraging the western military operations against them to bolster their popularity among pro-Palestinian Arab publics. They seek to present themselves as the legitimate rulers of Yemen, despite their ascension to power in Sanaa through military means, plundering of Yemeni state institutions, and history of repression and human rights violations. In response to the designation, the Houthis expelled all US and UK nationals working for the United Nations and aid organizations in Yemen. Taking further advantage of the current situation, the Houthi-controlled parliament in Sanaa ratified a law classifying countries, entities, and individuals deemed hostile to Yemen. This law is seen as part of the Houthis’ ongoing effort to seize properties and as a potential tool to suppress local dissent.

Shift in Approach Needed

The decision to designate the Houthis is troubling due to its potential negative impact on the Yemeni population. The United States must reassess the designation’s efficacy in achieving its intended objectives. If the goal is to influence Houthi behavior or constrain the group’s operations, a more comprehensive and strategic approach is required.

There is an urgent need for Washington to acknowledge the link between the Houthi attacks in the Red Sea and the war on Gaza. The US focus should shift toward multilateral engagement with regional and international partners, especially the Palestinians, to foster dialogue and to find diplomatic solutions to end the war on Gaza. There is a clear Arab and international interest in protecting Red Sea shipping lanes and in achieving a comprehensive resolution that starts with a ceasefire in Gaza. Additionally, to counter Houthis’ increasing military capabilities, the United States should support a politically and militarily unified Yemeni government and ensure a unified front against the group. The United States must address political fragmentation in Yemen to strengthen the Yemeni state and to empower it to counter Houthi influence both inside the country and in the Red Sea. 

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*This policy analysis paper was written first for and published on the Arab Center Washington DC. 

The U.S. Is Repeating Its Own Mistakes in Yemen

*The continuing rounds of U.S. airstrikes on Houthi targets in Yemen in response to their attacks on shipping in the Red Sea, and the re-listing of the Houthis as a "specially designated global terrorist" group, are the latest in a long list of mistakes in U.S. strategy in Yemen. These miscalculations were both expected and unexpected. On the one hand, they were unexpected, given hopes that the United States—and the United Kingdom, which has taken part in some of the bombardment of Yemen—had learned crucial lessons from Yemen's protracted conflict, most of all that the Saudi-led coalition that intervened in Yemen in 2015, with backing from the U.S. and the U.K., struggled to overcome the Houthi insurgency. On the other hand, these errors were expected, given the lack of any shift in strategy on the part of the American and British governments.

The Biden administration's decision to re-designate the Houthis as a terrorist group and to launch airstrikes on Yemen is a sign of the persistent neglect of any strategic considerations of the complexities of Yemen's conflict. Yemeni experts and observers have been nearly unanimous in their skepticism about the effectiveness of these airstrikes and the terrorism designation in deterring Houthi missile and drone attacks on ships in the Red Sea, which the militant group has portrayed as a campaign to defend Palestinians and force Israel to end its war in Gaza. Those doubts stem from a shared belief that the U.S., and with it the U.K., are repeating mistakes of the past in Yemen.

Since 2015, the U.S. and the U.K. have made a series of strategy errors through their support for the Saudi- and Emirati-led war against the Houthis in Yemen. They inadvertently bolstered the Houthis' military capabilities and strength on the ground, contributing to the overall instability in Yemen today. The airstrikes against the Houthis this month are seemingly a continuation of these mistakes and are unlikely to achieve their stated goal of "deterring" the Houthis in the Red Sea.

The Houthis control around half of Yemen today, thanks in part to missteps by the coalition fighting them since 2015, after they seized the capital, Sanaa. It all began when the U.S., the U.K., Saudi Arabia and the United Arab Emirates together failed to prevent then-Yemeni President Abdrabbuh Mansour Hadi, in 2016, from moving Yemen's Central Bank headquarters to Aden, where his government had fled—a move that directly facilitated the Houthi takeover of state institutions in Sanaa. The U.S. and the U.K., which were both supplying the joint Saudi-Emirati coalition with weapons and logistical support for their war, also didn't do more to stop the infighting among the Yemeni armed groups combating the Houthis on the ground, which were nominally part of that coalition. The Saudi-backed, armed wing of the Islah party, a Sunni Islamist movement, and the separatist Southern Transitional Council, backed by the Emiratis, were at war with each other more than they were fighting the Houthis.

The U.S. and U.K. also never expressed public disapproval of the UAE's role in forming Yemeni militias operating outside Yemen's internationally recognized government—which the coalition was trying to restore to power. Nor did they condemn the coalition (but most of all Saudi Arabia) for inadequately funding the Yemeni army, which weakened the Yemeni government in their fight against the Houthis. And between 2016 and 2018, the U.S. and the U.K. stood by when Saudi airstrikes targeted Yemeni army units loyal to former President Ali Abdullah Saleh, to the benefit of the Houthis, whose units remained unharmed and were able to take control of the army's former bases.

As Yemeni analyst Abdulghani al-Iryani put it, this was the Saudis' "greatest gift" to the Houthis." In those years, "when frontlines were largely static, the coalition provided the Houthis the opportunity to complete their military takeover of northern Yemen and get rid of their erstwhile partner," Saleh. "Thus, Riyadh, which for close to a century had a strategic objective to degrade the Yemeni military threat, ended up facilitating the Houthis' assertion of military dominance in the north, a process that was largely completed by 2017," al-Iryani explained—just before the Houthis turned on Saleh and assassinated him.

Similarly, the U.S. and the U.K. did not take any action when the UAE, which was supposedly supporting the Yemeni army against the Houthis, killed at least 30 Yemeni soldiers in airstrikes during infighting in Aden between the army and the Southern Transitional Council's UAE-backed militia. Washington and London both ignored the Yemeni government's condemnations of the UAE for supporting the southern separatists and helping to further fragment Yemen, to the extent that Hadi reportedly described the Emirates as an occupier rather than a liberator.

Meanwhile, the U.S. and the U.K. failed to address the Houthis' diversion of international humanitarian aid for their own purposes, despite many warnings. Washington and London seemingly ignored reports from the United Nations and human rights groups that the Houthis were obstructing and seizing aid supplies and money in the areas under their control for their war effort. Houthi forces used the diverted aid, including food, to recruit soldiers from impoverished communities in Yemen, exploiting their desperation, or sold the aid for profit on the black market.

In designating the Houthis as a terrorist group, Biden, who promised to "end the war in Yemen," is following Donald Trump. The widely criticized listing of the Houthis as a "foreign terrorist organization" in Trump's last days in office—a more severe designation than "specially designated global terrorist" group—had prevented much-needed humanitarian aid from getting into Yemen. As a presidential candidate, Biden criticized the terrorism listing, and he revoked it in his first weeks as president. With Biden's reversal, the U.S. has once again failed to understand the Houthi propaganda machine.

The Houthis are leveraging perceived U.S. injustice against the Yemeni people to garner sympathy in both domestic and international public opinion. Considering the severe impact that the terrorism designation has on humanitarian efforts in Yemen, the more dire the humanitarian situation becomes, the more evidence the Houthis have to present the U.S. as an enemy of the Yemeni people and the root cause of their suffering. Such a situation makes it easier for the Houthis to attract and recruit fighters, further strengthening their military capabilities and hold on much of Yemen.

All these errors have led to the fragmentation of the Yemeni state, politically and militarily, helping the Houthis consolidate their power. And they are being repeated, despite Biden himself admitting that airstrikes won't deter the Houthis, even though that was his initial justification for them. "When you say working, are they stopping the Houthis? No," Biden said in an exchange with reporters at the White House about the military strikes. "Are they going to continue? Yes."

There has been a profound inability in Washington to understand and learn from policy failures in Yemen. A more informed and nuanced approach that empowers Yemeni partners against the Houthis, especially through diplomatic pressure, is more urgent than ever to address the complexities of Yemen, rather than falling into another cycle of ineffective bombings and airstrikes.

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*This article was first written for and published in DAWN's website here. 

COP28: Achievements Fall Short of the Goal

Arab Center Washington DC - The recently concluded United Nations Climate Change Conference in Dubai, otherwise known as COP28, marked a significant moment in global efforts to address climate change. Over the course of negotiations from November 30 to December 13, representatives from 198 countries grappled with crucial decisions that will shape the world’s response to the climate crisis. Key accomplishments included an agreement to transition away from fossil fuels, the creation of a fund to help vulnerable countries pay for climate-related damage, and the publication of a landmark assessment of the world’s progress in mitigating climate change. While these achievements are all steps in the right direction, COP28 still fell short due to shortcomings and loopholes in the agreements.

The overall sentiment at COP28 was clear: while the international community postpones taking action to address climate change, the window of opportunity may be closing. “We are living through climate collapse in real-time,” said António Guterres, the UN Secretary-General at the summit’s opening, underscoring the urgency of the situation. Without aggressive actions, global warming is on track to reach nearly 3 degrees Celsius (°C) this century—twice the desired 1.5°C. Scientists anticipate that at this warming rate, the world could pass several catastrophic points of no return, from extreme weather events to rising sea levels to loss of biodiversity.

COP28’s Major Decisions

Most important at COP28 was participant countries’ commitment to “transitioning away from fossil fuels in energy systems, in a just, orderly and equitable manner…so as to achieve net zero by 2050 in keeping with the science.” The announcement was a milestone: it is the first time that the world has pledged to move away from fossil fuels, the largest contributor to climate change. COP26, held in 2026 in Glasgow, pledged only to “phase down” fossil fuel and coal and to “phase out” inefficient fossil fuel subsidies. The concept of phaseout refers to the complete discontinuation or removal of fossil fuel usage, while phasedown suggests a reduction in or restriction on usage without eliminating them. COP28’s agreement to shift away from fossil fuels represents a compromise between more than 100 countries that advocated for a phaseout and the members of the Organization of Petroleum Exporting Companies (OPEC), led by Saudi Arabia, which argued that emissions can be reduced without abandoning specific fuels.

The proposed transition away from fossil fuels does not legally obligate parties to comply or specify mechanisms of enforcement, which is unfortunate because countries are expanding their fossil fuel production. In an effort to reduce reliance on fossil fuels globally, more than 100 governments pledged at COP28 to triple the world’s renewable energy capacity by 2030. As the International Energy Agency warned on December 10, however, such a move is not sufficient on its own to limit global warming to 1.5°C.

Delegates at COP28 also achieved a historic breakthrough by formally establishing a Loss and Damage Fund, which will provide financing for vulnerable countries hit hard by climate disasters. Climate change-induced loss and damage has severe, and sometimes irreversible, consequences for both nature and human beings. Developing countries, particularly those in the Southern Hemisphere, are the most vulnerable. For instance, the 2022 floods in Pakistan resulted in more than $30 billion in economic losses, affecting millions of people and causing significant infrastructure damage and highlighting the urgent need for robust funding mechanisms. The new fund will be hosted by the World Bank for a four-year period. So far, some $700 million has been pledged, including $100 million each from the United Arab Emirates (UAE) and Germany, $75 million from the United Kingdom, $17.5 million from the United States, and $10 million from Japan. But the fund remains critically underfunded, as the economic cost of loss and damage in developing countries is estimated to reach $400 billion annually by 2023 and nearly $1.8 trillion by 2050. Although the Loss and Damage Fund is intended for poor nations most severely affected by climate change, more developed countries like China or India may be able to utilize it as well. This raises concerns about the equitable distribution of resources and increases the prospect of clashes between developing and developed nations over climate finance.

Finally, COP28 published the first-ever Global Stocktake in the history of climate negotiations, representing a crucial step forward in assessing and monitoring global efforts to address climate change. The Stocktake reports on global progress in emissions reduction, adaptation to climate impacts, and provision of support and on the overall progress of countries and stakeholders toward the objectives of the 2015 Paris Climate Change Agreement. The December 2023 Global Stocktake revealed that current actions are insufficient for maintaining a 1.5°C pathway. The text urged nations to triple renewable energy capacity and to double the global average annual rate of energy efficiency improvements by 2030, while advocating for the phasedown of unabated coal power and for a just transition away from fossil fuels.

Rich Versus Poor Sacrifices

The ongoing discussions surrounding climate change extend beyond mere dialogue—developed and developing countries have long-standing disagreements over financial accountability for climate change and environmental responsibility. Although developed countries are more responsible for causing climate damage, they have not made the necessary sacrifices to protect the climate, particularly in two crucial aspects.

First, developed countries are falling behind in fulfilling their commitment to fund climate finance. While there has been a collective pledge among wealthy nations to contribute $100 billion annually, there exists no official assessment of each country’s share in achieving this goal. Rich nations should provide substantial financial support to aid developing countries in transitioning from fossil fuels to renewable energy and in enhancing energy efficiency.

Second, developed nations are lagging in implementing environmental actions such as reducing carbon emissions, transitioning to renewable energy sources, and phasing out fossil fuels. Some of these countries rationalize their inaction by arguing that the burden of addressing climate change is unfairly placed upon them, especially when they perceive insufficient proportional efforts from developing nations. For example, developed countries are insisting that countries of the Gulf Cooperation Council (GCC) be among the rich nations required to fund climate finance, although the GCC countries historically have not contributed to climate change as significantly as bigger countries have.

Developing countries are also expected to contribute to global efforts to address climate change, such as by mitigating their greenhouse gas emissions, by implementing adaptation measures, and by providing transparent and accurate information about their emissions. But numerous challenges hinder their progress, with finance standing out as a barrier. Developing countries often rely on loans and other financial assistance from developed nations and international financial institutions to fund their climate initiatives. As a June 2023 International Institute for Environment and Development report put it, “The world’s most climate-vulnerable countries are being forced to spend billions more paying off their debts than they are receiving in help to beat climate change.” These loans can contribute to a cycle of debt, especially if the terms are not favorable or the borrowed funds are not effectively utilized.

This financial imbalance has led to growing frustration among developing nations. Developing countries are angry that they have contributed least to greenhouse gas emissions heating the planet, yet they are suffering the most—and are the least equipped to cope with the death and destruction wrought by climate disasters. In recent years, developing countries’ demands of equity and social justice have been sidelined, creating a sense of being taken for granted or regarded as mere supplicants of foreign aid and humanitarian assistance.

Controversies at COP28

The controversy surrounding Dubai’s hosting of COP28 stems from the UAE’s status as one of the world’s largest oil-producing countries. Throughout the gathering the summit’s Emirati president Sultan al-Jaber took the heat. The Guardian exposed al-Jaber’s misleading November 21 comment defending the continued use of fossil fuels. During a live online event, al-Jaber stated that “there is no science indicating that a phase-out of fossil fuels is needed to restrict global heating to 1.5°C.” This stance can be attributed to al-Jaber’s role as the president of UAE’s national oil company, ADNOC, which is one of the world’s largest energy companies. Defending fossil fuels is hardly a new phenomenon, however. US President Joe Biden recently acknowledged that the United States—one of the world’s leading climate polluters—will continue to need oil and natural gas over the next decade.

What distinguished COP28 was the unprecedented number of fossil fuel lobbyists in attendance. This surge conveyed a powerful message: that the economic interests of major countries are still predominantly controlled by the need for fossil fuels. While it is crucial to involve oil-producing nations and companies in climate summits to address the root cause of global warming, such gatherings also offer them the opportunity to mobilize and to collectively resist a fossil fuel phaseout. Indeed, media reports indicate that Saudi Arabia and OPEC exerted pressure on the UAE to shift its focus away from advocating for a fossil fuel phaseout.

Climate Inaction: A Global Challenge

Despite knowing the necessary steps to save the planet, governments lack the political will to take decisive action. The United Nations emphasizes the urgent need to reduce emissions by 45 percent by 2030 and to achieve net-zero by 2050 to limit global warming to 1.5°C, as outlined in the 2015 Paris Agreement. But most global policies and alternative energy initiatives are falling behind these targets.

A critical concern is whether or not major economies will end their climate foot-dragging and meet their climate commitments. The United States, India, China, Germany, the United Kingdom, South Korea, Saudi Arabia, Russia, Canada, Brazil, and Australia, among others, are out of reach of their climate targets.

Challenges also exist in fully replacing traditional energy sources with solar and wind power. Initial investments in renewable energy infrastructure have proven costly, and long-term success requires finding solutions to technical complications. During the slow transition to clean energy there is still a huge reliance on fossil fuels. OPEC, OPEC+ governments, China, India, the United States, and the European Union continue to urgently need fossil fuels to finance their economies during the transition.

It is doubtful that countries will be able to reach climate goals with quick solutions. Instead of merely setting pledges, the international community should implement a reward and punishment mechanism in which countries that exceed pollution quotas are penalized and fines are used to fund climate finance. In other words, such a mechanism would punish countries that pollute the planet more and reward those that demonstrate more effort to protect the planet. But the challenge lies in finding an entity with the power to enforce such measures. For example, it is impossible to imagine that the United Nations Security Council could do the job, given its ineffectiveness in addressing conflicts in Ukraine, Syria, Sudan and Gaza, among other crises.

The global public must persist in exerting pressure on world leaders and vocalizing the jeopardy in which climate change places humanity’s future. The effectiveness of public pressure is evident in the progress made during climate summits in addressing fossil fuels and discussing their problems. Until a couple of years ago, fossil fuels were virtually taboo at these significant global gatherings. Notably, it was at COP26 that leaders officially acknowledged fossil fuel and coal as a problem for the first time. That a COP summit, after 26 annual UN climate meetings, finally recognized the problem of fossil fuel in its final agreement shows how important words are to the countries negotiating at these summits.

Scientists play a crucial role in maintaining momentum by continuously expressing their concerns. Their persistence is essential to prompt governments to devise practical procedures for meeting their commitments. Our planet, unable to articulate its distress, is already emitting warning signals, akin to pulling a rubber band. The question that looms is for how long we can stretch it before it inevitably snaps.

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*This policy analysis paper was written for and published first on the Arab Center Washington DC website.

Yemen’s War Economy: A Key Factor in the Ongoing Conflict

Arab Center Washington DC - As Houthi negotiators leave Saudi Arabia after five days of talks with Saudi officials regarding the contours of a compromise solution to Yemen’s ongoing conflict, the country remains in the grip of certain war outcomes, specifically that of a war economy. Although the current conflict famously began with the 2015 Saudi and UAE military intervention against the Houthi armed group, it is in large part the pivotal juncture of many others: the 1994 Yemeni Civil War, the 2004 Houthi insurgency, the turbulent events of Yemen’s 2011 uprising, and the Houthi group’s takeover of Yemen’s capital, Sanaa, in 2014. Deep economic grievances primarily caused these conflicts, just as economic crises stemming from the current war are producing ever-growing poverty, suffering, and despair.

For example, discriminatory resource allocation, unemployment, and land rights violations were among the grievances that fueled the South’s role in the 1994 Civil War. Regarding the Houthi insurgency, historical grievances also played a significant role. The group’s members claim to belong to the sayyed class, which enjoyed ruling authority in North Yemen during the Mutawakkilite Kingdom of Yemen (1918–1962, with some vestiges of control until 1970). Following the initial defeat of the kingdom in 1962 by the revolutionary republicans at the start of the North Yemen Civil War, the group was discontented over its loss of power, and aimed to restore what was taken from it. Decades later, additional discontent due to the marginalization and impoverishment of the group’s home governorate of Saada in the North directly led to the Houthi insurgency in 2004. Yemen’s 2011 uprising was also driven primarily by economic grievances, such as corruption and rising poverty. Then, in 2014, the Houthi group protested the government’s fuel reforms, after which it carried out a coup against the Yemeni government, which prompted the Saudi-led coalition’s engagement in the conflict in 2015.

Decades of unaddressed economic grievances ​and conflicts ​have provided fertile ground for the emergence of a dynamic war economy in Yemen, characterized by complex networks of actors all competing for economic power and control. Yemen’s war economy is mainly about resource allocation, organization, and mobilization with the key purpose of sustaining the fighting. Hence, war profiteering and exploitation of the various dimensions of the war in Yemen have prolonged the conflict and impeded the achievement of a durable peace and lasting stability. Additionally, the far-reaching impact of the war economy has been changing the country’s landscape and socioeconomic structure in complex ways.

The War Economy’s Manifestations

The current conflict has been altering numerous aspects of the country’s economic system and activities, and has resulted in the creation of two essentially parallel economies, one in the North and one in the South. Some of the most significant manifestations of Yemen’s war economy include double tariffs and double customs duties, two different currency exchange rates, disputed oil revenues, aid divergence, and an extraction economy, all of which place immense pressure on the Yemeni people.

Disagreement between the belligerent parties, the Houthi armed group in the North and the internationally-recognized government of Yemen (IRGY) in the South, over taxation and customs duties has led to a divided tax system in the country, with each side enforcing its own system of tariffs and customs duties. The IRGY charges customs when any goods arrive in ports under its control. Then, when traders navigate inland crossings to deliver those goods to areas under Houthi control, they are charged additional customs as the Houthis claim to be the legitimate governmental authority in the North. In fact, in August the Houthis increased charges on traders when they import items to Houthi-controlled areas from IRGY-controlled ports, areas, or land crossings by a 100 percent levy. These double tariffs deplete traders’ economic power and exponentially increase the price of goods. The Houthis’ move is intended to boost the group’s economic power, and it is already raking in the profits, having collected at least $1.8 billion in taxes and state revenues in 2019 alone.

The two economies have also produced two considerably different currency values in the North and South, in large part because the Houthis and the IRGY have both been printing bank notes, albeit in different volumes. As of February 2023, the going rate was 600 rials to the US dollar in Houthi-controlled areas and 1,225 rials to the dollar in IRGY-controlled areas—more than double the value. The conflict and the North-South division have also impacted oil exports, leading to a standoff over oil revenue allocation between the Houthis and the IRGY. The Yemeni economy relies heavily on the production and export of crude oil, which generate the lion’s share of state revenues. Revenues from crude oil exports increased in 2021, reaching $1.418 billion, compared to $710.5 million the previous year, primarily due to a rise in oil prices in global markets.

Under the pretext of paying civil sector and military salaries, the Houthis are demanding a large share of oil revenues. The IRGY has refused to share those revenues, and in order to halt them the Houthis in 2022 attacked three oil loading terminals located in IRGY areas, at the al-Mukalla port on October 25, at a Shabwa Governorate port on November 9, and at the port of al-Dabah on November 21. These attacks were intended to weaken the IRGY’s finances. Additionally, the Houthis in June 2023 banned domestically produced gas cylinders coming from the IRGY-controlled city of Marib in order to undermine its revenue streams. The clear message in all the Houthis’ moves is that in the absence of the group enjoying its share of Yemen’s state revenues, no one will enjoy them. Obtaining oil revenues is one of the Houthis’ central economic objectives, and the group has repeatedly tried without success to capture Yemen’s oil-rich Marib Governorate.

International humanitarian aid has become a means for economic benefit for the warring parties. Reports by various international organizations, including the United Nations, humanitarian agencies, and human rights organizations have revealed a pattern of interference in humanitarian aid distribution in Yemen. Humanitarian aid divergence, restrictions, and obstruction are some of the economic strategies that the warring parties have used to strengthen their influence. The IRGY and the secessionist Southern Transitional Council have interfered with and obstructed humanitarian assistance in Yemen’s Aden Governorate. In 2020, the IRGY reportedly engaged in money laundering and corruption practices, which had negative consequences on people’s ability to access adequate food supplies. Additionally, the government devised a scheme to divert funds from Saudi deposits, resulting in an illegal transfer of $423 million in public funds to traders. The Houthis have also been implicated in the exploitation of humanitarian aid, and the World Food Program has acknowledged the group’s aid divergence in the areas under its control. This diverted aid then makes its way into the Houthis’ own war effort.

Simultaneously, ordinary citizens’ financial resources have also gone toward filling the warring parties’ pockets. The high tariffs and the skyrocketing prices of essential commodities are part of an “extraction economy” perpetrated by the warring factions on the population at large. As thousands of civil workers have had difficulties receiving their salaries for years, they have been living off of their hard-earned savings, which in many cases have likely been thoroughly depleted. It is almost certain that the majority of people in Yemen have spent all their savings, considering that Yemen is one of the world’s poorest countries. Their money was taken by greedy warlords who wield both arms and power. The systematic extraction and depletion of people’s wealth, or rather the transfer of wealth from the citizenry to the political and military elite is one of the key manifestations of the war economy, and has led to a widening gap between the rich and the poor.

The Impact on Yemen’s Future

The war economy in Yemen holds two potential effects on the country’s future: structural transformations and the perpetuation of conflict. Players and networks that emerged and gained influence under the conflict have created new economic dynamics, leading to structural changes in the fundamental mechanisms of the country’s economic functions. An evident demonstration is the diverging economic systems between Yemen’s northern and southern regions. The structural changes have also profoundly changed capitalist elite formation in the country. For instance, prior to the conflict, former Yemeni President Ali Abdullah Saleh and his entourage sat at the top of the capitalist hierarchy in Yemen. Today, people from diverse factions—including the Houthi armed group, the IRGY, and the Southern Transitional Council—who dominate and control key economic domains such as the oil and fuel trade have become major players in the economy, and are rapidly becoming Yemen’s new capitalist elite.

The other significant effect of the war economy on Yemen’s future is the protraction of the conflict. The economic gains the warring parties continue to make during the war provide little impetus for ending the conflict, as demonstrated by the fact that a truce that expired in October 2022 has yet to be renewed. In this disheartening scenario, the outlook for Yemen’s future is darkened by persistent conflict.

Tomorrow’s Destiny

Decades of unresolved economic grievances and discontent compounded by a series of conflicts have formed the perfect environment for the emergence of a robust war economy. Double tariffs and customs duties, differing currency values, shrinking oil revenues, the exploitation and diversion of international humanitarian aid, and the extraction of the population’s wealth are some of the most significant economic activities emerging under the ongoing conflict. The warring parties have made economic gains through opportunism during wartime, making them unwilling and less likely to seek a peaceful resolution to the conflict. Meanwhile, the war economy has been transforming the country’s socioeconomic structure. Consequently, Yemen’s future looks bleak, and is likely to be characterized by protracted conflict, deepening poverty, and economic devastation.

Yemen’s war economy represents a critical factor sustaining the conflict, and addressing the war economy is thus essential to ending it. Given that the continuation of the war economy is in the interest of the warring parties, an external party must intervene. Here, the international community’s role is profoundly vital. It must take a multifaceted approach to Yemen’s economy, putting pressure on the warring parties to reach an agreement that addresses Yemen’s economic woes on two levels: historical economic grievances and contemporary economic challenges. Although the latter is an extension of the former, there must be a nationwide discourse to address these issues in order to pave a path toward national economic reconciliation. The outcomes of such deliberations could lay the groundwork for a more stable and prosperous Yemen in the long run. Although it must be said that any nationwide discourse should avoid the shortcomings and pitfalls of the previous National Dialogue Conference (2013–2014).

Regarding the country’s pressing contemporary economic challenges, the international community should press the warring parties to implement tangible measures to address the war economy’s many manifestations by unifying the tax system and exchange rate, resolving the oil revenues dispute, ensuring better and more transparent oversight of humanitarian aid, and redressing economic disparities. The international community also needs to support a ​​preemptive post-conflict economic recovery plan so that once the conflict ends, a plan will be ready for swift implementation. Certainly, reaching a comprehensive peace agreement is the fundamental first step before launching a post-conflict economic recovery plan. At every step, international diplomatic efforts must push the warring parties to prioritize the well-being of the Yemeni people over their own economic interests. Tackling the root causes of economic grievances and dismantling the war economy’s underpinnings are essential for ending the protracted conflict. Doing so may provide hope for a brighter future for Yemen and its people.

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*This policy analysis paper was written for and published first on the Arab Center Washington DC website.