After years of failed promises to implement major economic and political reforms, the Yemeni regime is grappling with extreme challenges on several fronts simultaneously. The most serious and immediate structural threat is that oil production is falling faster than anticipated and there is no other source of income likely to replace it before oil revenues drop below subsistence level. Despite hopes that investors would flock to the country to help establish a post-oil economy, this has not materialised, for largely political reasons. In 2009, the Yemeni government relied on oil revenues for around 75 percent of its budget. When Yemen becomes a net oil importer, the threads holding the patronage system together may be stretched to breaking point, and the regime will desperately need to secure alternative sources of income. This paper asks is why there has been no effective action been taken against this threat? Does the country's elite perhaps not perceive the threat to be serious enough to warrant a significant change in the way that politics is practicede Or do they perhaps believe that external actors will provide sufficient financial assistance to reduce the level of threat facing Yemene What other factors might contribute to a perception that the challenges facing the country remain manageable, and do not require a systemic change to political processese If, on the other hand, however, there is the perception that a serious threat does exist, how can we explain where the most significant barriers to effective action liei