Corruption in Yemen is a highly serious problem. Yemen is the most corrupt country in the Arabian Peninsula. It is also the poorest country in the Middle East, "with an exceptionally high birth rate, acute rates of child malnutrition and rapidly dwindling reserves of oil and water." In Yemen, according to Chatham House, "corruption, poverty and inequality are systemic"; in the words of the Carnegie Endowment for International Peace, corrupt activity is "so entrenched and pervasive" that many citizens feel powerless.
Absent any "system of control and accountability," corruption is now present throughout the public and private spheres, so much so that in the words of the World Bank, "[c]orruption and patronage networks are running the country's public affairs." This ubiquitous corruption has resulted in weak government and "corrupt power blocs that control public resources." As a consequence of civil-service corruption, there are large numbers of so-called ghost workers. Corruption in the energy, communications, and health and education sectors have resulted in inadequate service or no service at all.
Jane Marriott, Britain's Ambassador to Yemen, stated in December 2013 that corruption in Yemen was so pervasive that it was credibly undermining the security and economy of the nation. She also noted that institutionalized corruption of such a grand scale discourages development and innovation.
Background
In the mid 1990s, corruption allegedly became "rampant" in Yemen. The presidency of Ali Abdullah Saleh, who served from 1990 to 2012, was said to be marked by the admixture of government, military, and corporate interests as well as by extensive nepotism and self-enrichment. Members of Saleh's Sanhan clan established power bases in the military, with Saleh's brother Mohammed Abdullah Saleh running the Central Security Forces (CSF). On Mohammed Abdullah Selah's death in 2001, his son Yahya Mohamed Abdullah Saleh took control of the CSF. Meanwhile, Yahya's brothers Tarik and Ammar ran the Presidential Guard and the National Security Bureau (NSB) respectively. Military aid from the US and other Western countries ended up enhancing the personal wealth of these members of the Saleh family and also enhancing their "ability to act as a source of patronage."
In 2008, business people with close ties to Ahmed Saleh, the son of President Saleh, reportedly used World Bank funds to found Shibam Holding Company, a government-backed property developer. This new firm took control of a great deal of government land and, later, of the General Investment Authority (GIA).
Beginning in 2004, another clan, the Houthis, fought a six-year war against Saleh, whom they accused of corruption and criticized for sundry other reasons, including his U.S. and Saudi ties and his failure to support economic development in their region. This struggle gradually turned into a conflict between Ahmed Saleh's Republican Guard and Ali Mohsin's First Armoured Division, and it escalated in 2009 with a Saudi troop deployment. In 2010, international pressure led to a ceasefire.
Also in 2010, the CEIP stated in that Yemen was at greater systemic risk of collapsing from corruption, than by being toppled by Al-Qaeda.
Young Yemenis' anger over "political and economic exclusion" led to a 2011 popular uprising and increased the risk of civil war. In response, the U.S., U.K., and Saudi Arabia pushed for a transfer of power that would remove Saleh but left the political elites essentially intact. In 2012, then, with the elite's power crippled by its "increasingly obvious corruption," Ali Abdullah Saleh resigned from the presidency in exchange for a guarantee of immunity from prosecution and a promise that he could stay in the country.
This resignation effectively averted civil war. Replacing Saleh as president was his deputy, Abd Rabbu Mansour Hadi. The negotiated handover of power was widely viewed as "a regional success story" that could set Yemen on a "path towards a secure, prosperous future." As IRIN News put it, these developments were widely considered a step forward for good governance advocates, who had struggled to make reforms for years.
Over two years later, however, anti-corruption activists were still embattled with an entrenched culture of corruption that discourages honesty. A representative of a local human-rights foundation said that one patronage system had been dismantled, only to begin all new corruption systems. It was noted that bribery under Saleh was "more standardized" and that the breakdown of central authority has caused groups to demand inconsistent bribe amounts.