Faced with a mounting struggle to wean Yemen off its reliance on the diminishing oil sector, which contributes the bulk of export and fiscal revenue, the government had stepped up efforts to impose fiscal austerity. However, these efforts, which included passing a contractionary budget for 2011 and implementing a ten-point programme of reforms, will be superseded for the time being by the urgent desire to quell the spreading protests. In an effort to appease demonstrators, the government has implemented several economic support measures, including raising the wages of public-sector workers and reducing income tax, which are likely to strain the already stretched public finances. In addition, the government's programme to gradually phase out fuel subsidies, which began in 2010, is likely to be in hiatus for some time.

Yemen will also require substantial foreign aid, including the full disbursal of the US$5.7bn promised at a donor conference in London in 2006, if it is to avoid a full-blown economic crisis. Although the Gulf Co-operation Council (GCC) states have historically distanced themselves from Yemen's problems, fears that the country is descending into chaos will force them to provide increasing financial support. The economic support plan agreed with the IMF in August should also encourage the disbursal of the monies pledged at the London donor conference, although it is possible that ties with the IMF will be strained by the recently-announced fiscal support measures.