Yemeni street gets results

The Yemen Times reports (via J.G.) that

the Yemeni Government will tonight announce that the previous price hikes on petroleum derivatives will be cut in half. This would mean that the 100%, 240% and 100% hikes that were previously announced for gasoline, diesel and commercial LPG respectively will be reduced to 50%, 120% and 50% respectively.

This development came in the wake of the widespread protests in the major cities and the countryside that arose out of the Government's announcement last week for the initial price hikes.

The President of the Republic Ali Abdullah Saleh had announced three days ago that there is room for reassessment of the Government decision and if the initial Government decision was wrong, it can be revised to make it easier for the citizens to absorb.

The Yemeni street gets results!  Whether this apparent win by the "revolt of the hungry" is good for the Yemeni public in the long run is an open question - as ever macroeconomic concerns vs social welfare concerns - but it seems like a fairly clear climbdown by Saleh and the Yemeni government, which had been insisting throughout the protests that the price hikes would not be rescinded. 

If you combine this with the Jordanian Parliament's success in driving Bassem Awadullah from the cabinet of Adnan Badran, you've got two recent wins for populist defenders of social welfare benefits over advocates of neo-liberal economic reforms. 

Again, I remain agnostic on the question of who is right on the policy questions - Jordan's finances are unsustainable, as (I suspect) are Yemen's;  but the poorer classes and certain regions are getting hurt badly by the economic reforms.  But as a statement on shifting balances of political forces, it's an interesting thing. 

Comments

[The Lounsbury]

I have to differ with you mate.

[the aardvark]

about what, exactly?

[The Lounsbury]

The meaning of Awadallah's ouster especially. I would be hard pressed to call him a booster of liberal economics (or neo-liberal as you put it). He's a corrupt bastard. I'd grant it as a win of Jordanian East Banker interests and perhaps a touch of good governance politics.

[Fred]

Corrupt is a strong word, but BA is certainly no (neo) liberal economist. He is a promoter of Jordan's dependence on aid handouts versus economic self reliance.

The recent hikes are part of a longstanding policy of weaning the Jordanian budget and the Jordanian public off of foreign subsidies (Iraqi, Saudi or American). A round of fuel price hikes in 2001 or so was withdrawn when the public was not sufficiently prepared. It went through about six months later following a successful public relations campaign. Another round was successfully implemented in 2004. BA argued against both those hikes at the time on "political" grounds.