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                  REPUBLIC OF YEMEN: INTERIM STRATEGY NOTE
                               Meeting of the Executive Directors
                                   CHAIR’S SUMMING UP ∗
                                           November 13, 2012


         Executive Directors discussed the joint IDA/IFC Interim Strategy Note for the Republic
of Yemen for FY2013-FY2014. Directors appreciated its alignment with Yemen’s development
priorities and expressed broad support for its focus on stabilizing the transition in the short-term
and reaching rapid results while laying the groundwork for medium-term reforms (IDA/R2012-
0246[IFC/R2012-0315]).
        Directors commended Yemen for the steady progress made in this transition period and
encouraged the Bank Group to continue to play a leadership role in mobilizing aid & donor
coordination, especially given the significant pledges by the international community, and the
recently announced entry of Yemen into the Deauville Partnership. In particular, the support to
Yemen from Saudi Arabia was recognized. Directors called on all partners to work together to
ensure fiduciary integrity and implementation of the Mutual Accountability Framework.
        Directors also noted that serious risks and challenges remain. While recognizing the
limited timeframe of the ISN, they urged the Bank Group to continue to focus on implementation
in a flexible and realistic manner in the context of fragility. In this context, they highlighted the
longer term challenges, including economic management, employment creation particularly
among youth, sustainable use of natural resources, institutional capacity building and improving
governance. They also appreciated the candid assessment of risks in the document and urged the
Bank Group to closely monitor the situation and adjust the strategy and the operational resources
and response as needed.          They recognized the impediments to successful program
implementation and capacity shortages to absorb aid, but supported the proposed third party
monitoring and independent verification mechanism as a means to enhance implementation
support and progress, while noting the need to ensure sufficient donor resources are available to
deliver results and strengthen government capacity. Directors also welcomed the re-launch of
IFC’s advisory services, and encouraged IFC to continue to pursue investment opportunities
proactively with the objective of diversifying the economy and enhancing private sector
participation. They also prompted MIGA to remain alert to catalyzing foreign investments.
        Directors highlighted the importance of gender in the ISN and supported promoting
inclusion of youth, women, and marginalized groups in program design to address challenges
related to social upheaval. Directors also called for additional support, over the long term, to the
agriculture sector and to labor-intensive infrastructure development, and to engage in a dialogue
to address the challenges posed by the Qat culture.




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 This summary is not an approved record.