Yemen's ruler finally agrees to go – but will the regime go with him?

Yemeni President Ali Abdullah Saleh last night defied his sceptics to sign an historic deal handing over the reins of power to his deputy after a tumultuous 10 months of popular protest to his three-decade rule.

Mr Saleh, 69, finally capitulated to international pressure to transfer power after thrice reneging on the Gulf-backed initiative at the eleventh hour.

Fireworks rang out over the Yemeni capital Sanaa at the news as many residents expressed cautious hope that it marked progress towards resolving a stalemate that has crippled the impoverished nation for months.

More than six months of uncertainty has brought the economy to a halt, while sporadic clashes between government forces and various armed opponents have threatened to push it to the brink of civil war. "It is certainly good news," said Qasim Said Mohamed,a Sanaa shop owner. "Hopefully, today marks the beginning of better days."

But even as celebrations broke out in Sanaa's Change Square, many Yemenis were sceptical over the Gulf Cooperation Council deal.

Despite its endorsement by Yemen's established opposition, the GCC initiative has met with a lukewarm reception from many of the independent activists who see themselves as the driving force behind the protest movement.

Critical of Saudi Arabia's role and fearful that politicians will brush aside their goals of political reform and an end to corruption, they dismissed suggestions that Saleh's exit meant all their goals had been achieved.

"It's nowhere near over," said Hamza al-Kamaly, a medical student and leading youth activist, noting plans for further demonstrations in the coming days.

"Our revolution is not about getting rid of one man, our goal is the end of the whole regime."

His words were in sharp contrast to the mood in the Saudi capital, Riyadh – where King Abdullah, who oversaw the signing of the deal, called it a "new page" in Yemen's history.

Yemeni opposition members were also at the ceremony and signed the accord. Mr Saleh is the fourth dictator to fall from power since start of the Arab Spring, following the ousting of leaders in Tunisia, Egypt and Libya.

However, he will not step down immediately and will retain his title until a successor is elected.

Meanwhile, he must transfer power to his deputy, Abdrabuh Manur Hadi, within 30 days, with presidential elections to take place within three months.

In return, he and his family will receive immunity from prosecution, a clause that will irk the thousands of street demonstrators who want him to face justice for a security crackdown that left hundreds of protesters dead.

Gulf states and Western nations have been pressing Mr Saleh to agree to a power transfer deal for months.

For the political survivor – who in 33 years navigated Yemen through civil war, separatist rebellions and tribal rivalries and once likened governing it to "dancing on the heads of snakes" – the pressure eventually told.

Since returning from Saudi Arabia two months ago, where he was treated for severe burns after a failed assassination attempt, Mr Saleh has been squeezed by a collapsing economy, has seen his forces lose control of outlying provinces and has faced the threat of international sanctions.

Yesterday he promised the power transfer would offer "real partnership" with opposition parties.

UN Secretary General Ban Ki Moon, who "strongly urged" Mr Saleh to accept the deal in a phone call on Tuesday, said the organisation would "spare no efforts" to restore stability in Yemen.

Timeline: Yemen

20 January Following the demonstrations in other Arab countries, protests against President Saleh's rule erupt in Sanaa and other Yemeni towns.

22 March Saleh agrees to stand down, but says the protests are a "coup".

23 April Saleh accepts a Gulf Co-operation Council (GCC) plan for the transfer of power.

21 May Opposition groups sign the GCC deal after saying they received assurances Saleh would "definitely" sign on the following day.

3 June Shells hit presidential palace – Saleh is injured and travels to Saudi Arabia for treatment.

23 November Saleh travels to Saudi Arabia and finally signs the GCC plan.