Yemen seeks $4 billion a year in economic aid

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* Yemen needs aid to turn economy around-foreign minister

* Impoverished Arab country faces economic, security threats

(Adds quotes on rehabilitating militants)

By Ulf Laessing

SANAA, Jan 14 (Reuters) - Yemen, facing a daunting array of security and economic problems, needs about $2 billion a year in aid to stay afloat and double that to turn its economy around, Foreign Minister Abubakr al-Qirbi said on Thursday.

The impoverished Arab country has drawn international scrutiny since a Yemen-based al Qaeda wing said it was behind a failed attempt to blow up a U.S.-bound airliner on Dec. 25.

"I am not an economist, but I think one is talking about probably $4 billion a year," Qirbi told Reuters when asked how much aid was required to rescue an economy struggling with a sharply rising population and falling oil revenues.

He said the minimum needed in annual development aid was $2 billion, but added: "If you want a real impact, a real change in the economy, standards of living of population, addressing the issues of basic needs of Yemenis, you need more than that."

Britain has called an international conference on Yemen for Jan. 27 to discuss how to counter radicalisation and coordinate aid. Diplomats say the West wants to hold the Yemeni government accountable on economic reforms to ensure aid money is properly spent in a country where corruption is rampant.

Qirbi said Yemen was making "slow progress" with economic reforms, but gave no details.

He reiterated a conditional government offer of dialogue with al Qaeda members who renounce violence, but said Yemen was unable to fund a full-scale programme to rehabilitate them.

"If al Qaeda in Yemen declare that they are against terrorism, become part of the landscape as ordinary and peaceful citizens, then we will welcome dialogue," he said.

Qirbi, who has said he believes there are no more than 300 al Qaeda militants in Yemen, acknowledged that providing them with enough incentives to abandon their cause was a challenge.

"What we can offer them is that as the government rehabilitates them we will integrate them in the community. We will obviously have to provide them with jobs to become effective and useful members of their social communities."

Qirbi said any new programme to reorient militants away from their violent ideology would have to be more comprehensive than an effort the government promoted in 2005 and later shelved.

"We need to provide them with a form of living in the country, not just to integrate them without making them a productive part of their communities," the minister said.

But he said Yemen, the poorest Arab country, lacked the resources to emulate a well-funded rehabilitation programme for reformed militants run in neighbouring Saudi Arabia. (Editing by Alistair Lyon)

Reuters - Thomson Reuters Foundation
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