The poor cousin of the oil-rich Arab world, Yemen has struggled in obscurity for much of its modern, 20-year history.

It made headlines with the attempt to blow up a Detroit-bound airliner on Dec. 25, 2009, a high-grade incident backed by the Yemeni branch of al-Qaeda.

The country again became the focus of international attention in October 2010 after explosive material destined for synagogues in Chicago was found in packages shipped from Yemen. The U.S. government linked those attempted attacks to al-Qaeda.

One result of the December 2009 bombing attempt was that foreign ministers from 20 countries, including Canada, and representatives from international organizations met in London in January to discuss Yemen and the problem of international security.

Yemeni al-Qaeda militants listen to a verdict from behind bars at the state security court in Sana'a July 13, 2009. A Yemeni court sentenced six militants to death for attacks that killed nine Spanish and Belgian tourists over the past two years. Ten others were sentenced to jail terms ranging from eight to 15 years. (Reuters)

For Gordon Brown, Britain's prime minister at the time and the meeting's convener, "Yemen — as both an incubator and potential safe haven for terrorism — presents a regional and global threat."

While terrorism was a top concern for those attending the two-hour conference, the meeting highlighted that Yemen is heading into a gathering storm of problems.

These range from chronic unemployment to dwindling oil and water reserves to widespread use of the amphetamine-like drug khat.

"The actual fact is that the economic problem is the major cause of all the ills Yemen is facing now," Yemeni Foreign Minister Abubakr al-Qirbi told Reuters before the London meeting.

The economy alone, however, doesn't explain the full range of problems facing the troubled country of nearly 24 million.

Problem No. 1: a resurgent al-Qaeda

The group now known as al-Qaeda in the Arabian Peninsula (AQAP) declared its existence in January 2009.

It is a merger of al-Qaeda's Saudi and Yemeni branches, once significant operations. (Osama bin Laden was born in Saudi Arabia, his father in Yemen.)

Saudi troops are shown on the Yemen border on Jan. 27 as international leaders met in London to discuss the Yemen situation. (Reuters)

After a crackdown in the wake of the 9/11 attacks, Yemeni and U.S authorities felt they had largely eliminated the Yemeni branch of al-Qaeda as of 2003.

But a dramatic prison break in 2006 freed 23 hardline insurgents, including AQAP leader Nasir al-Wuhayshi. The prisoners were believed to have had support from Yemeni security officials.

Meanwhile, in Saudi Arabia, authorities had al-Qaeda on the run and by 2008 the group there was telling its members to move to Yemen.

While this was going on, Yemen was facing a rebellion in its north and a secession movement in the south.

Foreign Minister al-Qirbi concedes that his government made a mistake in "sparing" al-Qaeda until 2009, in order to focus on those other security concerns.

The government had also employed mujahedeen in those two campaigns, which contributed to a new generation of AQAP leaders who are "more talented and more ambitious," according to Brian O'Neill, former editor of The Yemen Observer.

Very patient

O'Neill notes "AQAP's institutional growth, reach, boldness, regional ambition, and perhaps most unnerving, its patience."

The group also employs the internet, with videos, an online journal (Sada al-Malahin, the Echo of Battles), and discussion boards that call on jihadists to come to Yemen and join them.

Khat leaves are sold at a market in Sana'a, Yemen. A bag this size sells for about $10 US and will last three to four hours. (Margaret Evans/CBC) Khat "People in this country are simply chewing their way to oblivion," Yemeni cabinet minister Abdel-Rahman al-Eryani told the Guardian newspaper. An estimated 75 per cent of Yemeni men, regardless of social standing, chew khat on a daily basis. Khat's popularity stems from its amphetamine-like properties. Users says it gives them energy, self-esteem and mental sharpness. But it has serious health risks, especially as a result of the chemicals used to boost crop yields. Yemen's largest crop, khat also takes up so much acreage that the country is now a net importer of food. And since khat has no nutritional value, there are more problems: Every day five million Yemenis go hungry and 250 children die from malnutrition, many in refugee camps, according to UNICEF.

"Today al-Qaeda members are putting down roots by marrying into local tribes and establishing a durable infrastructure that can survive the loss of key commanders," Yemen expert Gregory Johnsen writes in Foreign Policy magazine.

"They have also launched a two-track policy of persuasion and intimidation, first by constructing a narrative of jihad that is broadly popular in Yemen, and second by assassinating or executing security officials who prove too aggressive in their pursuit of al-Qaeda fighters."

According to Yemeni government estimates, AQAP has 200 to 300 operatives.

The underwear-bombing attempt was the first time it had tried to attack a domestic American target and came just months after the U.S. military re-established close connections with Yemeni security.

War with al-Qaeda escalates

On April 26, 2010, an al-Qaeda suicide bomber tried and failed to kill the British ambassador to Yemen.

An air strike on May 25 that was supposed to target an al-Qaeda suspect instead killed the deputy governor of Ma'arib province, Jaber al-Shabwani. That led to two pipeline bombings and clashes between his Al-Shabwan ethnic group and security forces.

Al-Qaeda actions intensified through the summer. In August, officials reported that al-Qaeda had killed 53 soldiers since May.

In September the military launched an offensive against an al-Qaeda cell in the town of Hawta in the province of Shabwa. It was reported that they shelled the town with artillery and tanks and deployed assault helicopters. Fifteen thousand civilians fled.

Oct. 6 saw another attack on a British diplomat, this time the deputy ambassador. Fiona Gibb was uninjured by the rocket-propelled grenade, but another British official and two bystanders were injured.

In mid-October, with clashes between al-Qaeda and security forces happening nearly weekly, the military began airstrikes on the town of Moudia in Abyan province. On Nov. 1, 14 al-Qaeda members surrendered to the governor of Abyan.

Problem No. 2: Leadership 'like dancing with snakes'

President Ali Abdullah Saleh took power in North Yemen in 1978, the last in a series of military rulers, and continued to rule the united country following the 1990 merger with South Yemen.

He is used to being in charge. But this should be his last term as president — 2013 is the end date — unless he gets a change to Yemen's new election laws.

Saleh governs Yemen through a system of patronage and tradeoffs among the competing interests of Yemeni tribes and other groups. Ruling Yemen, he often says, is "like dancing with snakes."

Outside of the major cities, tribal chiefs exercise more authority and the government's power is limited.

"Much of the population outside major highland urban areas associates the Saleh regime with corruption, cronyism, nepotism, and blocked economic and social opportunities," says Yemen expert Christopher Boucek of the think-tank The Carnegie Endowment for International Peace.

Even the government's own Central Organization for Control and Auditing "has alleged that nearly 30 per cent of government revenue is never deposited in government accounts," Boucek writes.

Yemen's President Ali Abdullah Saleh addresses a news conference in Sana'a Oct. 30. (Khaled Abdullah/Reuters)

As a result, expanding central government control, particularly with U.S. help, risks alienating more of the population.

"Mr. Saleh presents the Obama administration with a problem that is all too familiar in Afghanistan and Pakistan," writes The New York Times' Steven Erlanger. "He is amenable to American support, but his ineffective and corrupt bureaucracy has limited reach.

"And his willingness to battle al-Qaeda, which he does not view as his main enemy, is questionable."

The president runs Yemen like a family affair. His son Ahmed, who Saleh appears to be grooming as his successor, heads the Yemen Republican Guard and the country's special forces.

Saleh's half-brother heads the air force. Nephew Amar is the deputy director for national security. Nephew Yahye heads the central security forces and the counter-terrorism unit. Tarek, also a nephew, heads the Presidential Guard.

Problem No. 3: southern secession

For the past three years, southern Yemenis have been staging mass protests calling for reinstatement of southerners dismissed from the civil service and army, higher pensions, a fairer share of the country's dwindling national wealth and an end to corruption.

Through 2010, the protests led to severe repression by the security services, which seemed to only spur on the demand for secession by the south, where most of the country's oil is located.

South and North Yemen were independent states until 1990. The South had been aligned with the Soviet Union and the superpower's collapse was a key factor leading to Yemeni unity.

Yemen unification had the misfortune of bad timing, coming just before Iraq's 1990 invasion of Kuwait.

Supporters of the separatist Southern Movement attend an anti-government rally in the southern Yemeni town of al-Habileen Oct. 14. (Reuters)

The traditionally anti-Saudi Yemenis had been aligned with Iraq and had one of the rotating seats on the UN Security Council at the time.

Yemen's ambassador abstained on the vote for military action against Iraq, earning American and Saudi enmity.

Saudi Arabia expelled nearly a million Yemeni migrant workers, exacerbating Yemen's economic problems at a crucial time.

The northern elite saw reunification as a wealth grab; for many in the south it was a failure. Civil war broke out in 1994, largely, it is said, at Saleh's instigation. His northern forces triumphed but did not vanquish southern secessionist demands.

Problem No. 4: human rights violations

A report issued by Human Rights Watch in December 2009 examines the widespread abuses by Yemeni security forces in the south: "Unlawful killings, arbitrary detentions, beatings, crackdowns on freedom of assembly and speech, arrests of journalists, and others."

And goes on to say, "These abuses have created a climate of fear, but have also increased bitterness and alienation among southerners, who say the north economically exploits and politically marginalizes them.

"The security forces have enjoyed impunity for unlawful attacks against southerners, increasing pro-secessionist sentiments in the south and plunging the country into an escalating spiral of repression, protests, and more repression."

Serious human rights violations, however, are not confined to south Yemen.

Journalists, bloggers, professors and even comedians have been arrested because of what they have written or said. Websites critical of the government have been blocked. Publications have been confiscated.

In May 2009, at the offices of Al-Ayyam, the country's oldest and most popular independent newspaper, security forces engaged in a one-hour gun battle with the paper's security guards.

Another shoot-out took place at Al-Ayyam on Jan. 4, 2010. The security forces and the security guards both saw one of their own killed and three wounded.

The newspaper's editor, Hisham Bashraheel, and two of his sons were jailed for three months. Their trial began in October. The government had banned Al-Ayyam for allegedly sympathizing with the southern secessionist movement.

Problem No. 5: The Houthi rebellion

The Houthi rebellion started in 2004, taking its name from the man then leading the rebels.

Oil and water Yemen could run out of exportable oil by 2017, according to The World Bank. It is also running out of fresh water as well. Oil exports are already down from a peak of 450,000 barrels per day in 2003 to about 286,000 last year, a significant drop for a government that depends on oil for three-quarters of its revenue. In Sana'a, the capital, wells are expected to run dry by 2015. While in Taiz, a city in the southwest, the half million inhabitants are allowed access to public water tanks just once every 45 days.

The conflict is in the Saada province that borders Saudi Arabia. The majority of Yemenis are Sunni Muslims. But in this area of the country most people belong to the Zaidi branch of Shia Islam, a branch unique to Yemen.

In the 1980s, a movement emerged among Zaidis in resistance to what they perceived as Sunni domination. According to Joost Hiltermann of the International Crisis Group, "The insurgency is more a reaction to a dysfunctional government than an inspired, centralized, ideological movement."

The Houthi movement's slogan is, "God is great! Death to America! Death to Israel! Curse upon the Jews! Victory to Islam!"

Nevertheless, the Houthis have not targeted Westerners or Jews. Some of their early protests were against government co-operation with U.S. counter-terrorism efforts.

The well-armed Houthi fighters number between 2,000 and 10,000 and the conflict has forced an estimated 250,000 people to flee their homes, according to the UN.

In August 2009, the Yemen government launched Operation Scorched Earth against rebels in northwestern Yemen.

In November, the Saudi air force began bombing Houthi positions on both sides of the border and Saudi involvement in the fight quickly escalated. In just over two months, 113 Saudi soldiers had died.

That was the sixth round of fighting and lasted until a ceasefire in February 2010. Sporadic fighting continued, including a clash in July that resulted in more than 70 deaths.

In August the government and the rebels signed an accord to implement the February ceasefire, but so far it appears neither side is adhering to its terms.