Creating temporary job opportunities for underserved communities (1996–2000)

Established in 1996, Yemen’s Public Works Project (PWP) offers short-term employment to unemployed Yemenis to build key infrastructure (such as schools, hospitals, water and sanitation systems, and local roads) in local communities, which also supports the development of the communities. The project was initially designed to mitigate the impacts of an International Monetary Reform (IMF) economic reform package on the most vulnerable, particularly low-income and unemployed people. 

The 1991 Gulf War resulted in the repatriation of approximately 750,000 Yemenis, which in turn created an increase in unemployment and a significant reduction of inward remittances.  The impact of the Gulf War, combined with a civil war (1994), and a two-year drought, destabilized Yemen’s economy—as public spending exceeded revenue and external debt surged. In 1995, Yemen embarked on an IMF economic reform to bring down its external debt and lower the risk of debt distress. Under the reform, public spending was reduced and policies were enacted to support private sector-led economic growth.¹ 

However, in reducing government spending, most notably through lifting general subsidies, there was a risk that people living in poverty (who are typically more reliant on publicly provided social services) would be left further behind. The public works program was therefore established in 1996 to complement the reform programs by providing job opportunities and infrastructure to those most in need.² 

The public works project aimed to create small-scale civil work employment (including in both new construction and rehabilitation) in geographic areas where the unemployment rate was above average.  The project focused on the following sectors:

1. Waste management: wastewater collection systems and stormwater drains, cleaning of such systems, and solid waste collection and sanitary landfills; 
2. Urban development: water distribution systems, repairing and paving streets and footpaths, stormwater drainage, flood protection; 
3. Rural development: road repairs, water supply systems, cleaning and repairing of irrigation canals; 
4. Soil conservation: terrace and drainage work, small dams; and 
5. Health and education: building health centers and school buildings.³

The overall objective of the project was to create an accumulated 75,000 to 96,000 months of employment (number of workers unspecified) over four years, between 1996 and 2000, while improving the available infrastructure for communities in need.

Implementation

The public works project was established by Law No. 36 in 1996. The Prime Minister Decree No. 3 (1996) subsequently established a Steering Committee to approve project-related policies, resolve project issues, and oversee the operation of the project management unit (PMU). The Steering Committee was composed of nine senior government officials (at the ministerial rank) and chaired by the Minister of Planning and Development. A project management unit (PMU) was also established, which is responsible for the implementation of the project. The PMU consisted of 20 qualified professionals and support staff. It had written staff service rules, and manuals of procedures, and it established a comprehensive management information system, as well as regional offices.⁴ 

The project’s success in creating employment and delivering infrastructure to local communities resulted in increased donor financing and the implementation of subsequent public works projects.

Cost

Although the PWP is implemented by the government of Yemen, it is financed by international donors. The initial project cost was SDR 17 million, or USD 25 million, financed by a World Bank loan.⁵ In 1998, the Netherlands provided an additional NLG 4,000,00 (USD 1.96 million) in grant financing to finance the construction of 13 girls’ schools.⁶ During the project, the USD/SDR rate depreciated and by the project’s close, was valued at USD 23.18. When the project closed, the project cost was USD 30.44 million, of which USD 23.18 was financed by a World Bank loan, USD 1.96 by a grant from the government of the Netherlands, and USD 5.30 million was provided by the government of Yemen.⁷ 

Assessment

By 2000, the public works project had created 66,000 work months of employment (equivalent to employing 22,000 people temporarily for three months, or 11,000 people temporarily for six months) and 422 community projects that had improved infrastructure to the benefit of approximately two million people.  At the same time, the public works project had established a highly effective project management unit that was able to review, monitor and finance millions of dollars and hundreds of community-based projects at the same time.

In terms of employment creation, the 66,000 work months created were slightly below the 75,000–96,000 target, due to a large number of work months being omitted from monitoring in the early project stages, less labor required than anticipated in the construction of schools and hospitals (which accounted for the majority of infrastructure constructed), and a higher-than-expected cost of creating small-scale employment. Nonetheless, it remained a significant achievement in providing short-term employment to unemployed Yemenis.

The 422 community projects financed covered all of the target sectors, but were most heavily concentrated in education (53 percent of all sub-projects), health (18 percent of all sub-projects, and water (11 percent of all sub-projects). The project also financed classroom furniture for the schools and classrooms that were built, supplying an additional 11,856 student seats.  By the end of 2000, all of the sub-projects were operational.

The grant from the Netherlands financed the construction of 13 girls’ schools and provided classroom furniture for 4,088 student seats.

The Steering Committee successfully resolved all issues that arose during the project implementation, and the project management unit successfully identified projects to finance, engaged local communities, and quickly disbursed project funds of up to USD 1 million per month.

The success of the project brought increased financing from other donors for similar projects and resulted in the World Bank establishing numerous successive public works projects with the government of Yemen that run until the present day.  The most recent results highlight that the project has now financed 7,000 sub-projects, provided eight million work-months of employment, and provided infrastructure to the benefit of 23.9 million people.⁸ 

However, the project’s work lacks sustainability as it relies wholly on external funds. Some critics view the extension of the public works project for 27 years, potentially in competition with certain Ministries, as undermining national governance structures.⁹ 

Additional Information

With the outbreak of war in 2015, many donors suspended their funding towards the public works project, causing a massive increase in unemployment during a period where vulnerability was heightened. In 2016, the Yemen Emergency Crisis Response Project (YECRP), a partnership between the World Bank and the United Nations Development Programme (UNDP), resumed PWP operations (phase 4).¹⁰ Phase four remains in progress and is financed by the World Bank and the Arab and Kuwaiti Fund.¹¹ 

Architecture of the Old Town of Sana’a, Yemen. ©Adobe Stock/Anton Ivanov Photo

Tags

• Labor
• Low-Income Country
• Middle East & North Africa
• Rural Areas
• Social Protection
• Spatial Inequality
• Urban Areas
• Yemen