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

Since 2007 a new political factor has spread round South Yemen known as the Southern Movement. During its existence, the movement has not manifested patterns typical to earlier political movements in either part of the formerly divided Yemen. The movement lacks unified national leadership and it has neither held conferences nor presented a program for future. Thus it has been easy for its opponents and foreign observers to label it simply as "secessionist" and outside the scope of viable options for the country's future. In my paper, I argue that the Southern Movement is a new generation social movement that cannot be analyzed in comparison to older political movements such as the National Liberation Front or Front for the Liberation of Occupied South Yemen. Lack of national leadership, joint program or organizational structure are conscious choices made within the movement. While new local leaders take over after others have been detained or exiled the movement has been able to keep going despite attempts to suppress it. Illuminatingly, one of its supporters called it a snake with thousand heads. Such "non-movement" choices have been difficult to understand also for the older generation of Southerners who participated in the independence struggle. The active presence of the movement in the Internet and satellite TV have also made it more accessible to the younger generation. Like in earlier conflicts in the South, family roots often dictate on whose side people find themselves. Thus the demand for re-establishing the previous Southern state, the PDRY confuses many people. For the new generation of political actors in this movement, however, this is a tactical move to establish an entirely new political platform free from patrimonial relations, favoritism and corruption. While debates in qat gatherings and the Internet focus on irrevocable differences between the Southern and the Northern culture, the movement carves way for a modern state in Yemen. The paper is based on anthropological fieldwork carried out in Southern Yemen before and after the Yemeni unity during the course of 1988-2010, altogether some there years.

In recent years, political scientists, historians, and religionists have referred to a "Zaydi revival" in contemporary Northern Yemen. Pointing to such phenomena as the formation of Zaydi educational institutes and heritage foundations and the publication of Zaydi educational pamphlets, scholars have suggested that "Neo-Zaydi" 'ulama' have attempted to assert their influence in the public sphere to respond to the challenge posed by the modern nation state on the one hand, and alternative streams of Islam on the other. Such studies thus portray contemporary Zaydism as, at base, a political identity born in the modern period. This paper discusses aspects of the scholarly life of the Zaydi 'ulama' in Northern Yemen which run against the grain of this characterization. Based on my discussions with Zaydi 'ulama' and participation in Zaydi durus (lessons) during the summer of 2009, and the readership statements on manuscript codices from the past two centuries, I argue that the curriculum, form, and methods of contemporary Zaydi scholarship betray strong continuities with its past. In this presentation, I will describe how the contemporary Zaydi dars (lesson) employs a number of old and durable scholastic techniques--qira'a (reading), sharh (commentary), mujadala (disputation), ijaza (license)--to connect scholars present to preceding generations. These techniques engender sets of relationships which form a crucial identity of the contemporary Zaydi scholar: as the recipient of an intellectual heritage from the scholarly benefactors of past generations. This paper thus provides a humanistic counter-weight to social science scholarship's tendency to reduce contemporary Zaydism to a political identity.

Oil's decline means that the Yemeni political economy faces tremendous challenges in the medium future as it moves towards more diverse sources of growth. The success or difficulty of Yemen's economic transition will depend to a great extent upon the capacity of the state to regulate and tax. Unfortunately, precisely at the moment the state is called upon to invest in social and physical infrastructure for domestic growth, the state is challenged with its own declining revenues and severe political crises, the majority of which observers attribute to the political strategies and tactics of the regime itself. So at the same time that the state called upon to promote economic growth, it must also begin to significantly tax the domestic economy in the midst of a severe crisis of political legitimacy. Of course there are other sources of state income such as foreign aid and grants which the state has relied upon in the past and which may indeed stem the immediate crises, but these are unsustainable in the long term and the state must develop the ability to collect domestic revenue from society to cover the bulk of its expenditure. Most observers doubt the ability of the state to develop the institutional capacity to tax, regulate, invest, and implement the programs that will help successfully move the economy towards a less oil dependent future. Some observers suffice with a blanket condemnation of corruption in the state. There are many different forms of corruption, though, and their economic outcome is not determinant. South Korea was famous for corruption during its period of unprecedented economic growth so the nature of corruption and its relation to growth needs specification. Others point to the rentier nature of the state and the patronage networks that the regime has relied upon in the last two decades. Here it is the lack of bureaucratic capacity and the reliance on cash for loyalty that is problematic. Still others lament the role of 'customary' or 'traditional' politics, i.e., tribes and clans, that inhibits the kind of political capacity necessary for state development. Some point to the role of external actors such as Saudi Arabia or the United States in undermining domestic political development and others point to the regime's 'divide and conquer' strategies. This paper will attempt to evaluate each of these arguments and assess the future of the Yemeni political economy.