Yemen is located in southern Arabia. The north is mountainous, with a fertile strip along the Red Sea. The south is largely arid mountains and desert. Until 1990 Yemen was two countries, the Yemen Arab Republic in the north and the People's Democratic Republic of Yemen in the south. The north was run by successive military regimes; the poorer south was the Arab world's only Marxist state. Post-unification conflict between the two ruling hierarchies, nominally in coalition, led to a two-month civil war in 1994 and the ousting of the southern-based former Marxists, and a new constitution.

Yemenis are almost entirely of Arab and Bedouin descent, though there is a small, dwindling, Jewish minority and people of mixed African and Arab descent along the south coast. The majority are Sunni Muslims, of the Shafi sect. However, Zaydi Shi'a are strong in the north, where many people have close family in Saudi Arabia. Many Yemenis consider Saudi Arabia's Asir province to be part of Yemen.

Agriculture supports more than half the population. Many Yemenis went to work in Saudi Arabia and the Gulf states during the 1970s oil boom. More than a million worked in Saudi Arabia, and their expulsion, due to Yemen's support for Iraq's invasion of Kuwait in 1990, has increased domestic unemployment.

In rural areas and in the northern highlands, Islamic orthodoxy is strong and most women wear the veil. In the south, however, women still claim the freedoms they had under the Marxist regime, especially in urban areas.

Tension continues to exist between the south, led by cosmopolitan Aden, and the more conservative north, leading in 1994 to civil war.

Strengths

Rising oil production. Salt mining. Deposits of copper, gold, lead, zinc, and molybdenum. Industries include oil refining, chemicals, food products, cement, leather. Improving private sector.

Weaknesses

Political instability deters foreign investment. Heavy economic damage caused by civil war. Well-organized black market undermines tax base. Large balance-of-payments deficit. Dependence on subsistence agriculture. Burden of high population growth, leading to unemployment.

Profile

Unification in 1990 aimed to transform the economy, particularly through the exploitation of large oil and gas reserves, discovered in 1984; exports of oil began in 1987. Industrial investment around the port of Aden was planned. These policies suffered severe setbacks as a result of the 1990–1991 Gulf War. In addition, the expulsion of over one million Yemeni guest workers from Saudi Arabia imposed a huge burden on the economy and ended the flow of workers' remittances.

The 1994 civil war inflicted further serious damage on the economy – oil refineries, water systems, and communications centers were destroyed. Economic crisis forced the government to reduce expenditure and subsidies on certain staple foods. This provoked widespread civil unrest (there were particularly violent demonstrations in 1998) and encouraged many farmers to switch from food crops, such as wheat, to growing the more profitable narcotic plant qat. As a result, Yemen has increasingly had to import foodstuffs. Lack of central control, poor integration, and the persistence of patronage politics are hampering economic revival.

Yemen is a multiparty democracy. The president retains executive power.

Profile

The merger of North and South Yemen in 1990 united Yemenis under one ruler for the first time since 1735 and free elections were held in 1993. President Ali Saleh initially maintained unity. Then, in 1994, a bloody civil war erupted, fueling a secessionist movement in the south. By mid-1994, fighting subsided and the southerners, led by ex-Vice President Ali Salem al-Baidh, were crushed. In legislative elections held in 1997 President Saleh's GPC won an absolute majority of seats, in part due to a boycott by the former southern-ruling Yemen Socialist Party, and in 1999 he won the region's first direct election of a head of state. Saleh's regime still faces threats from disgruntled tribesmen angry at levels of poverty in their oil-rich country. Since 1992, tribesmen have kidnapped more than 100 foreigners, including diplomats and tourists.

Main Political Issues

Relations with Saudi Arabia

Relations have long been strained – over oil exploration rights, Yemeni claims on Asir, and accusations that Riyadh funds insurgent tribesmen. The two sides clashed violently in 1998 over 1600 km (1000 miles) of disputed border, despite a 1995 memorandum of understanding. In early 2001, both sides withdrew border troops under a pact reached the previous June.

Instability

Since the end of the civil war, stability has been threatened by the border dispute with Saudi Arabia, growing tribal insurgency, and mounting popular discontent with President Saleh's government. The Islamist al-Islah party, formerly a junior partner of the GPC, now forms the chief opposition.

Yemen is internationally regarded as a base for Islamic terrorists and was shunned for its support of Iraq in the Gulf War. The government has tried to break this isolation with active support for the US-led "war on terrorism." A major border dispute with Saudi Arabia was resolved in 2000.

Following unification in 1990, mutual suspicion hampered the integration of the defense forces of former North and South Yemen. Sporadic, bitter clashes have taken place.

Main security concerns are insurgent tribesmen and, internationally, anti-Western terrorist activity such as the sinking of USS Cole off Aden in late 2000. US military aid has risen accordingly.

There are considerable reserves of oil, though initial estimates were exagerrated. The 2000 border agreement with Saudi Arabia promises better Yemeni access to oil fields. Salt is the only other mineral commercially exploited, and its production continues to grow steadily.

The agricultural sector employs well over half the working population. Cotton is a cash crop. Livestock and livestock products, including dairy produce and hides, are mainstays of the north. Yemen's rich fishing grounds in the Arabian Sea now provide a major source of earnings, despite poor equipment. Ambitious plans for an Aden freeport, first revealed in 1994, have yet to be realised.

Large areas remain untouched by development, preserving habitats for rare birds. Problems include water scarcity, overgrazing, and soil erosion.

Aden's key position at the entrance to the Red Sea makes it a significant port. Adequate roads link the main cities, but many rural areas are inaccessible. Sana and Aden are served by international airlines, including Yemenia's modern fleet.

The major cities have an adequate primary health care system. A new 300-bed hospital in Sana is due to be completed in 2004. Rural areas are less well served. Health services are under threat from tribal gangs. In 1998 three nuns working as health volunteers at the Dar al-Salam Hospital in the western city of Hudaydah were shot dead by a tribal gunman.

Some 80% of the population have no formal classroom education. Schooling barely extends into the rural areas. Illiteracy is especially high among women: 74% cannot read or write. Only 13% of students at Yemen's two universities – Sana and Aden – are female. Yemen also has some technical colleges. The government's unpopular economic policies have encouraged student activism.

Political assassinations continue to threaten political stability. There is little formal law enforcement outside the main cities; foreign companies risk kidnappings and theft by Bedouin raiders. There is a proliferation of illicit weapons; the number of firearms has been estimated at 50 million – three times the population. Some blame lawlessness on the narcotic, qat.

Most Yemenis suffered a fall in living standards after Saudi Arabia expelled its Yemeni workers. A lack of jobs in other Gulf states has fueled unemployment, estimated at around 30%. Except for a small elite, the ownership of consumer goods is low.

Believed to be the home of the legendary Queen of Sheba, Yemen attracts tourists interested in Arab society, architecture, archaeology, and historical remains. The Romans called Yemen Arabia Felix because of its fertile farmlands and dominance in the frankincense trade. Yemen was the second country, after Saudi Arabia, to convert to Islam.

Southern Yemen has been open to Western visitors only since 1990. Its run-down infrastructure and lack of hotels, especially on the coast, have hindered tourism. Sana, a walled medieval city, is the more interesting center for tourists. It has impressive architecture, particularly tall stone and mud brick Arab houses, and the palaces of the former imamate. Despite being over 100 km (62 miles) from the capital, the Marib Dam, built in ancient times, is another major attraction.

German and French tourists were the first to travel to North Yemen during the 1980s. Hopes of a major rise in tourism following the end of the 1994 civil war were dashed in 1998 after tribesmen kidnapped and killed four tourists.

Tourists are subject to a ban on the consumption of alcohol, except in five-star hotels. Whisky and beer are available on the black market, which operates out of Djibouti.

From the 9th century, the Zaydi dynasty ruled Yemen until their defeat by the Ottoman Turks in 1517. The Turks were expelled by the Zaydi imams in 1636.

• 1839 Britain occupies Aden.
• 1918 North Yemen independent.
• 1937 Aden made a Crown Colony, hinterland a Protectorate.
• 1962 Army coup in north. Imam deposed, Yemen Arab Republic (YAR) declared. Civil war.
• 1963 Aden and Protectorate united to form Federation of South Arabia.
• 1967 South Arabia independent as People's Republic of South Yemen. British troops leave Aden.
• 1970 South Yemen renamed People's Democratic Republic of Yemen (PDRY). Republican victory in YAR civil war.
• 1972 War between YAR and PDRY ends in peace settlement.
• 1974 Army coup in YAR.
• 1978 Lt. Col. Ali Saleh YAR president. Coup in PDRY. Radical Abdalfattah Ismail in power.
• 1979 PDRY 20-year treaty with USSR.
• 1980 Ismail replaced by moderate Ali Muhammed.
• 1982 PDRY peace treaty with Oman. Major earthquake kills 3000.
• 1984 YAR signs 20-year cooperation treaty with USSR.
• 1986 Coup attempt in PDRY leads to civil war. Rebels take control of Aden. New PDRY president meets YAR counterpart.
• 1987 Oil production starts in YAR.
• 1988 YAR holds elections for consultative council; Muslim Brotherhood gains influence.
• 1989 Speeding-up of unification process. PDRY publishes a program of free-market reforms. YAR and PDRY sign unification agreement. Constitution of unified Yemen published.
• 1990 Restrictions on north–south travel between YAR and PDRY lifted. Ali Saleh becomes president of Republic of Yemen. May, formal unification. Pro-Islamic groups oppose secular constitution.
• 1991 Yemeni guest workers expelled by Saudi Arabia in retaliation for Yemen's position over Iraqi invasion of Kuwait. Arab states boycott independence celebrations.
• 1992 Assassinations, food riots, and political unrest delay elections.
• 1994 Southern secessionists defeated in civil war. Amended constitution adopted.
• 1997 President Saleh's GPC wins absolute majority in general election.
• 1998–1999 Violent border dispute with Saudi Arabia. Kidnapping of tourists, four killed; three members of Islamic Army of Aden (IAA) sentenced to death.
• 1999 Saleh reelected.
• 2000 Yemen agrees border with Saudi Arabia after 66-year dispute. October, terror attacks on US naval vessel and UK embassy.
• 2001 Referendum approves extension of presidential term to seven years.
• 2002 Government targets suspected al-Qaida allies in tribal areas, expels 100 foreign "scholars."