Mediterranean Economies 2023
DOI: 10.1401/9788815411167/c1
Sidestepping the unresolved
occupation of Palestine and increasingly promoting military and technological
cooperation between Israel and the Arab Gulf monarchies, the Accords have also
assumed a broader containment function vis-à-vis Iran. A further demonstration of
the shifting balance of power in the region is provided by Turkey, which has
consistently progressed down the road of rapprochement with the Arab Gulf monarchies
and Israel over the past year, as discussed in the following section. Even Lebanon
has been partially brought into the fold, as demonstrated by the maritime
demarcation deal with Israel that was mediated by the US in late 2022
[3]
. The result is an increasingly fragmented region, characterised by
pinnacles of wealth,
¶{p. 30}high-tech development and emerging
forms of integration in sections of the Eastern Mediterranean
and Arabian Peninsula while other states and societies are left with limited
options, other than seeking support from wealthy regional neighbours or turning to
the International Monetary Fund for foreign assistance (and often both). Considering
that states most adversely affected by these recent developments are those that are
already experiencing severe internal strife or conflict (Yemen, Syria, Lebanon,
Palestine, Libya, Tunisia and Iraq) it is hard to see how these growing
developmental and socio-economic gaps can be reversed in the near future. This means
that large sections of the MENA may remain in a dangerous limbo of stalled
development and internal strife just as the region needs to urgently prepare for new
global crises linked to the climate emergency and impending energy transitions.
Finally, the Russian invasion of
Ukraine also provided newfound political leverage for key energy exporting states in
the region. This was promptly used to deflect residual criticism surrounding human
rights or authoritarian consolidation at home. European states in particular rushed
to the region for alternative energy resources to diversify from Russia, agreeing to
revise previous bans on weapons sales to Arab states in the Gulf in the process
[Kadam 2022; Middle East Eye 2021]. New oil and gas deals were signed with Algeria,
Egypt, Israel, Qatar and the UAE throughout 2022, returning the MENA to some of its
lost centrality in European energy markets.
Significantly, however, both
Europe and the US failed to convince most MENA states, including closest allies in
the Arabian Peninsula and Israel as well as NATO member Turkey, to fully align with
the West’s policy of sanctioning Moscow. Neither did the US or Europe succeed in
convincing Saudi Arabia and other OPEC members to increase oil production to
stabilise global energy prices.
Instead, after having rebuffed
US and EU requests on multiple occasions [Nussbaum and Nereim 2022; Westall and
MacDonald 2022], Saudi Arabia actually joined Russia and the OPEC+ grouping to
cut back oil output in October 2022, sending a stern
message of independence to their primary security benefactor in the US [Klippenstein
2022; Reuters 2022e]. While a number of MENA states did vote to condemn Russia at
the UN (with the ¶{p. 31}exception of Syria which has backed Russia
in all resolutions), most states – and particularly the GCC countries – chose to
abstain, while only Morocco (and Turkey) have provided Ukraine with military support
[Patkin, Yavorsky, Almaari et al. 2022; Schaer 2022]. Explained
by the broad trade interests that tie a number of these states to Russia as well as
the driving priority of energy exporters to maximise returns from the present high
prices, the deeper significance relates to the emergence of a more multipolar Middle
East.
Multipolarity is reflected in
the West’s declining leverage across the region and the increased tendency for
independent action displayed by a network of rising and increasingly
integrated regional powers. The increased penetration of
both Russia and China has meanwhile diluted the West’s influence over regional
dynamics, with MENA states increasingly balancing relations with both East and West.
Driven by a widespread belief that the US is no longer willing to shoulder major
security burdens in the MENA, US President Biden’s promise that the «US will not
walk away» [Ravid 2022] from the Middle East during his much anticipated July 2022
trip to Israel and the Arabian Peninsula did little to assuage concern over a
supposed US «retrenchment» from the region. The chaotic images of the US and NATO
withdrawal from Afghanistan in August 2021, combined with the US’s reluctance to
more forcibly support Saudi Arabia and the UAE in the context of the war in Yemen
[4]
, have reinforced this perception further. Indeed, 2022 would also
witness a sustained crisis in the bilateral US-Saudi relationship, after Crown
Prince Mohammad Bin Salman refused to assist Washington in its efforts to stabilise
global energy prices [Hamid 2022; Porter 2022]. The growing multipolarity of the
region was displayed further in early December 2022 in the context of Chinese
President Xi Jinping’s visit to Saudi Arabia to attend the
1st China-GCC Summit [Xinhua Net 2022]. The visit was
quickly contrasted with the more frosty reception received by President Biden only
months prior, while the signing of multiple energy, telecommunications (including
with the US-sanctioned Chinese company Huawei [Al Jazeera
¶{p. 32}2022b]) and even security deals underscored Saudi Arabia’s
and the Emirate’s interest in exploring multiple cooperation frameworks with China,
even at the cost of angering the US [Al Jazeera 2022a; Miller 2022].
1.2. Iran and the Persian Gulf
Developments surrounding Iran
took a decisive turn for the worse over the past year. The Vienna negotiations
mediated by the EU to bring both Tehran and Washington back to full compliance with
the Joint Comprehensive Plan of Action (JCPOA) had progressed through fits and
starts throughout most of 2021, leading in December and January 2022 to the eighth
round of talks to revive the 2015 Iran nuclear deal
[5]
. With the start of the new year, momentum seemed positive as the sides
slowly worked through their respective demands and appeared to be nearing a
compromise, though significant divisions remained [Reuters 2022c].
By February and March 2022
pessimism over the JCPOA’s future returned with a vengeance.
Iran continued to upgrade and
advance its nuclear programme, while the US refused to limit sanctions and the IAEA
and Europe sought renewed assurances and intrusive inspections in Iran as well as
the continuation of an ongoing IAEA probe into past alleged nuclear activities that
breached international accords. While progress seemed to have been made on one
sticking point – the US recognition of the Iranian Revolutionary Guard Corps as a
terrorist organisation, which Tehran had originally requested be revoked in the
context of the resumed Vienna talks – others quickly emerged to hamper progress.
More fundamentally, however, it was the absence of trust between the sides that
prevented a breakthrough. The election of a conservative government in Iran, led by
President Ebrahim Raisi in June 2021, had changed Iran’s negotiating team, while the
Biden administration’s troubles in Congress and with its regional ally Israel,
prevented the display of greater flexibility on the side of the US. Events in the
Persian ¶{p. 33}Gulf, with repeated missile and drone attacks from
Yemen targeting the UAE in January and February, also contributed to keep tensions high
[6]
. Finally, the outbreak of the Russian invasion of Ukraine in late
February would cast a long shadow on the JCPOA negotiations, as concern spread that
either the US or Russia – a party to the JCPOA and Vienna talks – may politicise the
process to score points against their rivals. Ultimately, these initial fears were
overcome, but again no serious progress was made towards a deal. In March, missile
attacks resumed from Yemen, including a major coordinated attack on Saudi oil
facilities on 25 March [ACLED 2023], an event which drew international attention
once again to the Persian Gulf and the ongoing conflict in Yemen. Following the
attack and subsequent retribution by the Saudi-led coalition across Yemen, the UN
announced a truce in the country. This was subsequently renewed twice until it
expired in October 2022 [ACLED 2022]. While the truce brought important life-saving
respite to a population suffering from one of the most acute humanitarian and
emergency crises of the region, Yemen’s future remains increasingly uncertain as
concern mounts following the refusal by warring parties to renew the UN deal.
Returning to Iran and the JCPOA
negotiations, the subsequent period of summer 2022 was characterised by a flurry of
diplomatic activity and shuttle diplomacy by the EU High Representative Joseph
Borrell. Visiting Iran in June 2022, Borrell again made frantic attempts to dampen
tensions and resume the spirit of compromise, leading to the resumption of indirect
EU-mediated Iran-US talks in Doha, Qatar between 28-29 June. As the parties again
failed to make progress, broader developments in the region seemed to be providing a
conducive environment for rapprochement. Regional talks between Iran and its Arab
neighbours had resumed, with reciprocal visits between Iranian and Emirati officials
occurring in December 2021 and May 2022 leading eventually to the formal resumption
of diplomatic relations between Iran and the UAE in August 2022 [Al Jazeera 2022m].
Meanwhile, talks between Iran, Saudi Arabia and Kuwait were also said to be
advancing, further contributing to a hesitant détente in the
¶{p. 34}Persian Gulf between May and September [Yeranian 2022]. In
this time span, the EU High Representative made two last-ditch attempts to bridge
the gaps and mounting mistrust between the US and Iran, seeking creative means to
reassure both sides and thereby salvage the JCPOA [Borrell 2022]. Yet proposals were
repeatedly rejected by the sides, with Iran sending additional reservations to the
draft text circulated by the EU and France, Germany and the UK, as well as the US
Biden administration, insisting that the proposal was final. Ultimately, it was
apparent that, with the November mid-term elections fast approaching in the US,
talks over the JCPOA would have to be suspended as all sides regrouped and dug in on
their respective positions.
By mid-September, however,
conditions changed again. The outbreak of protests in Iran combined with news of
Iran’s sale of military drones to Russia added important impediments to the talks,
further undermining what little trust remained between the sides [International
Crisis Group 2022c; Alcaro 2022]. Protests erupted following the arrest of Mahsa
Amini, a young Kurdish-Iranian women, who died in police custody after being
detained by Iran’s morality police in Tehran for not wearing the mandatory
hair-covering headscarf in public. Demonstrations spread to multiple localities
across Iran, with the authorities overseeing a brutal crackdown, jailing thousands
and imposing the death penalty on many young citizens [Human Rights Watch 2022a].
Initially focusing on the morality police and calling for increased women’s rights
and an end to the mandatory headscarf, the protests gradually mutated into overt
calls for revolution and the toppling of the Islamic Republic. While significant and
widespread, it remains unclear whether the protests can truly threaten the regime in
Tehran. Compared to the protests of 2019 and more so 2009, the present wave is less
numerous and more restricted across social strata and age groups. Mostly
concentrated in Iran’s underprivileged minority regions and involving youth, Iranian
authorities have resorted to different degrees of repression across the country.
With over 300 dead according to UN figures from late November [UN News 2022a], other
accounts have put the death toll at close to 500 since protests began in
mid-September, including almost 20,000 arrests [HRANA 2022].
With much of the Iranian public
suffering from a sustained erosion of socio-economic indicators and living standards
linked
Note
[3] While the maritime deal is by no means a step towards a full normalisation of Israeli-Lebanese relations, the agreement can be framed as part of the broader process that has informed the Abraham Accords, promoting economic integration as a means to help stabilise the region around a close knit grouping of states centred on the Arabian Peninsula, Egypt, Jordan and Israel while again sidestepping the occupation of Palestine. See Harb [2022].
[4] Particularly in the wake of repeated drone and missile attacks reportedly carried out by the Houthi rebels on Emirati targets from Yemen during the early months of 2022. See Al Jazeera [2022i]; Al Jazeera [2022d].
[5] For a comprehensive timeline of the Iran nuclear negotiations see, Arms Control Association [2023]; also see, International Crisis Group [2022e].
[6] For a comprehensive analysis of Houthi drone and missile attacks in the Arabian Peninsula see, ACLED [2023].
[7] On the Iranian economy in 2022 see, Rome [2022].