DUBAI (Reuters) - Abd-Rabbu Mansour Hadi's drive to restore order to Yemen after last year's uprising against his predecessor risks being bogged down in a prolonged war with al Qaeda unless he moves swiftly on reconciliation talks and asserts control over the armed forces.
Bickering between supporters and opponents of former President Ali Abdullah Saleh, the longstanding grievances of northern Shi'ite Muslim rebels and southern secessionists, and lawlessness in a country awash with arms, are just some of the obstacles to Hadi's reconstruction aims.
Al Qaeda, with an ability to strike at will across a country facing chronic problems of poverty and stretched resources and in urgent need of foreign investment, is one of the main hindrances to Yemen's chances of ever building a secure future.
The Islamist militant group's Yemen-based branch, al Qaeda in the Arabian Peninsula (AQAP), is described by the CIA as the "most dangerous" arm of the network founded by Osama bin Laden. It has suffered some setbacks since Hadi came to power in November last year under a U.S-backed power transfer deal.
The Yemeni army, backed by U.S. drones, has driven the militant group and its Ansar al-Sharia (Partisans of Islamic Law) allies out of cities in Abyan province which they had seized last year.
But militants are fighting back with a wave of deadly suicide bombings targeting top military brass and tribal allies. A series of attacks killed the commander of the southern region, Major General Salem Qatan, in June and the head of Yemen's military academy, Brigadier Omar Barasheed, in August.
"The war on al Qaeda has no doubt brought tangible results. But Hadi has only won a battle, not the war," said Ibrahim Sharqieh, a Yemen analyst at the Doha Brookings Institute in Qatar.
"To win the war, Hadi needs to work on a comprehensive programme of development, rebuild the country's institutions and push national reconciliation dialogue forward," he added.
COUNTRY SLOWLY RECOVERS?
When Saleh stepped down in November last year, he left a country in ruins.
The army was deeply divided, al Qaeda-linked militants were in control of large swathes of the south, oil exports had halved following repeated attacks on the main oil pipeline and the capital Sanaa was spending most nights in darkness due to frequent power cuts.
Some stability has returned since then, but Yemenis say it has not yet returned to the levels of before activists took to the streets in January last year, beginning the revolt that eventually resulted in Saleh ending his 33 years in power.
Barriers that once divided the capital into warring zones have been dismantled, power supplies have been restored and Saleh's powerful relatives are gradually losing their influence over the armed forces and the security establishment.
The country has even started exporting jet fuel for the first time in 18 months, after its oil pipeline was repaired allowing the main refinery in Aden to restart work earlier this month. The riyal currency, which had been fluctuating up and down since last year, has stabilised.
The biggest triumph came in June, when the Yemeni army, backed by U.S. air strikes and intelligence information, managed to dislodge Islamist militants from cities in southern Yemen they had captured as Saleh fought the uprising against his rule.
But Ali Saif, a Yemeni analyst, said Yemen's political and regional fault lines were a more serious threat in the long-term than the militants, who are Washington's main focus for now.
Al Qaeda has in the past used Yemen as a base from which to plot attacks abroad. In 2009, the group tried to bomb a plane bound for the United States.
STRUGGLE OVER ARMED FORCES
Under the power transfer deal with Saleh, Hadi was mandated to preside over major reforms during a two-year interim period to ensure a transition to democracy.
These reforms include restructuring the armed forces to unify them and break the hold of Saleh's family.
Hadi sacked the air force chief, a brother of Saleh, then turned his attention to Saleh's more powerful son, Brigadier General Ahmed, commander of the elite Republican Guards, once a bulwark against al Qaeda.
In a series of decrees this month, the new president created a new force under his own command, composed of units from the Republican Guards as well as units of a dissident general, Ali Mohsen, who broke away from Saleh's forces during the uprising.
The moves slashed the number of brigades under Ahmed's control by a third, sparking a small mutiny among the Republican Guards in which soldiers exchanged fire with Hadi loyalists outside the Defence Ministry building on Tuesday.
Eman Ebed Alkadi of the Eurasia Group consultancy firm said the decrees were effectively creating a parallel military and security structure, which Saleh and his son would resist.
"The death of General Omar Barasheed, a senior air force official and head of Yemen's Military Academy... is one sign of the growing power of AQAP and its affiliates," Alkadi wrote.
Hadi's government has been pushing for a reconciliation conference of the Houthi Shi'ites from the north, southern secessionists and other groups in Sanaa later this year.
Mohammed al-Ahmedi, a journalist who specialises in Islamist affairs in Yemen, also said defeating al Qaeda would come as part of a wider approach involving dialogue with all sides.
"The war in Yemen is still in place and there is no military solution for this war," Ahmedi said. "Past experience has shown that only a comprehensive solution that involves dialogue, providing services and working to regain the legitimacy of the state can help."
(Reporting by Sami Aboudi; editing by Andrew Hammond)