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Yemen, a U.S. counter-terrorism partner, teeters on edge of collapse

Fast-moving events have left Yemen veering toward a possible civil war with sectarian overtones

The capital remains firmly in the hands of northern-based Shiite Muslim rebels.

Sunni Muslim tribesmen to the east are arming in revolt and threatening to sabotage the country's crucial oil and gas infrastructure.

In the south, where separatist sentiment is rampant, President Abdu Rabu Mansour Hadi is setting up a rival power base with loyal militiamen, army units and tribes — and the backing of powerful Persian Gulf states.

The fast-moving events of recent weeks have left Yemen, a key partner in U.S. counter-terrorism efforts, on the edge of collapse and veering toward a possible civil war with sectarian overtones.

There is fear that the economy will unravel, even as U.N.-brokered political negotiations aimed at resolving the crisis appear at an impasse.

U.S. drone attacks on Al Qaeda targets continue, with a new strike reported Saturday in Shabwa province. But the central government is now in the hands of a Houthi minority that views both Al Qaeda and Washington as adversaries.

"Everything is very divided right now," said Jamila Ali Raja, an independent political consultant and women's activist in Sana, the capital. "And it's getting more and more complicated."

There are few signs that the crisis will be resolved anytime soon, now four years after the eruption of "Arab Spring" protests that eventually led to the ousting of longtime President Ali Abdullah Saleh.

Saleh remains ensconced at his heavily guarded compound, a still-potent figure who many see as plotting a return to power, navigating alliances of convenience amid the atmosphere of intrigue and uncertainty.

Despite a surface sense of normality in the capital, there is growing fear of an economic crash, as oil revenue plummets and foreign aid dries up. The nation's central bank governor, Mohamed Awad Bin Humam, has denied reports that Sana is running out of money to pay the salaries of civil and military employees.

But official pronouncements of confidence have not allayed economic concern in the Arab world's poorest nation, where more than 60% of the population of 26 million now depends on some kind of aid, according to United Nations figures.

"The situation is fragile and any significant impact of the crisis on the economy may result in increased humanitarian needs at a time [when] donor support for Yemen has been dwindling," Johannes van der Klaauw, the U.N. humanitarian coordinator for Yemen, recently warned.

On the political front, regional and sectarian rifts are undercutting efforts by the special U.N. envoy, Jamal Benomar, to broker a peace deal. Talks appear to have stalled.

The country is in effect split into two rival power centers: Sana, under control of northern Houthi rebels, and Aden, the southern port city to where President Hadi, a southerner, fled more than a week ago after escaping from Houthi house arrest in the capital. Hadi later rescinded his decision to resign the presidency.

The United States and its allies have pulled their diplomatic staffs from Sana, citing security and dramatizing the Houthis' diplomatic isolation. The Houthis called the withdrawal an effort to undermine their legitimacy and cause economic havoc.

Several gulf nations, including powerhouse neighbor Saudi Arabia, have moved their embassy operations to Aden, backing Hadi against what they term a coup.

But the Houthis declared defiantly that Hadi had "lost his legitimacy" and could face criminal prosecution. Ministers who refused to go along with Houthi plans for a caretaker government could be brought up on treason charges, the group said.

The Houthis, who mostly adhere to the Zaidi sect of Shiite Islam, seized Sana in September and consolidated their hold in recent weeks, dissolving the parliament. The group says it seeks a democratic and representative government.

Their military prowess is undisputed: In the years before seizing power, the Houthis fought off various attacks by the central government, backed by Saudi Arabia, and have also effectively smashed Al Qaeda elements.

Though they represent only about a third of the population, the Houthis' anti-corruption stance and opposition to cuts in fuel subsidies gained many crossover followers. The group also won admirers for restoring a measure of security to the capital and chasing out Al Qaeda operatives.

But there are signs that support for the Houthis may be diminishing. Many in Sana assail what they call the group's unilateral power grab.

"The Houthi has committed political suicide and has no one to blame but himself," said Adel Shujaa, a sociologist at Sana University, who said the faction was "isolated domestically and internationally."

The Houthis' major foreign ally appears to be Iran, an alliance that some find problematic: Saudi Arabia, a largely Sunni nation that views Yemen as part of its sphere of influence, is engaged in a power struggle with Shiite Iran for regional dominance. The prospect of a Tehran-friendly administration on its southern flank has alarmed Riyadh. Some fear the ultimate result could be a Syria-style proxy war.

East of the Yemeni capital, in oil-rich Marib province, Saudi money is said to be flowing to Sunni tribes opposed to the Houthis. Attacks on oil and gas infrastructure have cost the nation more than $4 billion in recent years, according to the central bank.

In the south, a separatist movement is gathering momentum amid the chaos, drawing on long-entrenched animus toward the north. North and south Yemen were two nations until unification in 1990. Though Hadi insists that Yemen must remain one nation, his flight to the south appears to have emboldened secessionist sentiment.

"The Houthis' entry into Sana proved the south's belief that Sana cannot build a modern nation state," said Mohammad Ali Shayef, who heads a pro-separatist group based in Aden. "All we are doing now is liberating our land."

Special correspondents Nabih Bulos and Zaid Al-Alayaa contributed to this report.

Twitter: @mcdneville

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