West Asia & North Africa Digest | December 2019

I) Political Developments 

Arab Spring 2.0:
Second season of Arab Spring is currently in full bloom in Iraq, Lebanon, Sudan and Algeria. There are a number of common multiples among these four countries.  All of them are listed in the Corruption Perceptions Index of Transparency International as endemically corrupt: Syria (178th out of 180 in 2018), Sudan (172nd), Iraq (168th) and Lebanon (138th).  Public opinion polls conducted in 2018 by Princeton University’s Arab Barometer have documented that economic development, combating corruption, and bettering the quality of public services are the most pressing issues for solid majorities in these countries.  This is true for Sudan (79%) 81% in Algeria, 56% in Iraq and 73% in Lebanon. Perhaps more poignantly, the government institutions have lost citizens’ trust. According to the Arab Barometer, 70% of Sudanese do not trust their government, while the figure is 90% in Algeria, 87% in Iraq, and 81% in Lebanon. With this sombre overarching backdrop we numerate the related developments in these four oases currently verdant with the Arab Spring 2.0: 
Comment: Please see “From Arab Spring to Arab Satyagraha?” on WION TV Website at URL: http://go.pardot.com/e/827843/ring-to-arab-satyagraha-263856/zkq/915877?h=rllXSTzeZerQXjvZfLi1v17adK4vh0u5SFSuAnx6EIU .
 
Iraq
Anti-establishment demonstrations ended their second month by securing their first tangible gain: resignation of Iraqi Prime Minister Adel Abdul Mahdi. While the national parliament accepted the resignation on December 1, this was only a pyrrhic victory as he was to continue in caretaker capacity and the appointment of his successor was many weeks away due to complicated coalition political horse trading. Abdul Mahdi’s departure also did not bring Iraq any closer to demonstrators’ demands for a more responsive, transparent and corruption-free political system  Still, the event put political elite on notice and influential Shia clergy of the country veered around to supporting the movement. Persistence of the movement and preservation of its non-violent and non-sectarian character was a major achievement. By the end of the month over 400 Iraqis, mostly young demonstrators, were killed by police and security forces. The month saw almost daily demonstrations and sit-ins at major choke-points in capital Baghdad, Basra port and various Iraqi cities. Iranian consulates in Shia Holy cities of Najaf and Karbala were set ablaze by the demonstrators as a sign of the nationalist anger over Iranian interference.   
 
On Nov 23, US Vice President Mike Pence visited American troops stationed in Iraq. He pointedly skipped Baghdad, going instead to Erbil and met Nerchirvan Barzani, President of Kurdish Regional Government. He spoke on the phone with the embattled Iraqi Prime Minister Adel Abdul Mahdi.
 
Comment: Please see “Iraq’s Autumn of Discontent” in The Hindu website on Dec 11, 2019 at URL: http://go.pardot.com/e/827843/discontent-article30270123-ece/zks/915877?h=rllXSTzeZerQXjvZfLi1v17adK4vh0u5SFSuAnx6EIU
 
Lebanon
The political stalemate in Lebanon entered its second month with a sense of suspended apprehension as adverse fallout took its toll on national economy. Although Lebanon managed to avoid a default by paying it due $1.5 billion debt, there was widespread chaos due to prolonged of closures of banks, petrol pumps and logistics. Shortage of US dollars also caused difficulties in a country where almost everything is imported.
 
Although Prime Minister Saad al-Hariri resigned on Oct 29, the country remained without any successor being appointed.
 
After over a month of peaceful demonstrations against corruption, sect-based politics,  there were signs of frayed nerves among various political operators. Pro-Iran Shia political parties such as Hizbollah and Amal came out against the protestors leading to violent clashes in Beirut on Nov 24 and 25. This alarmed the international community leading to the UN Security Council issuing a statement for preserving the peace in Lebanon and respect for right to peaceful protests.
 
Algeria
With December 12 date for presidential poll approaching, 40-weeks old public demonstrations acquired a new focus: rejection of the elections, which have already been postponed twice since ouster of President Abdulaziz Bouteflika in April this year. The protestors are calling for boycott of these election as it seeks to perpetuate the ancien regime, pointed out that all five candidates have been part of Bouteflika system and lack credibility. They demand overhaul of the FLN created le Pouvoir apparatus and its replacement with a system with greater democracy and transparency. They also chaff against the corruption between the oligarchs and politico-military leadership.
 
Comment: Nearly nine months since the agitations began, Algerian politics remains in a limbo. Military strongman Lt. Gen. Ahmed Gaid Salah and caretaker President Bensaleh assert the supremacy of the constitutional process, taken literally; this contrasts with the popular demand for a total break with the past which has failed to meet Algerians’ aspirations for better living standards, improved governance and more jobs. While the confrontation has largely been peaceful, with the approaching deadline, the authorities are reported to be using strong arm tactics, such as arrests of dissidents and media critics. Algeria has a history of electoral muddles. The observers fear that the coming election, instead of resolving the ongoing political impasse, may create a new pivot of friction.


Sudan
On November 29, Sudan’s Prime Minister Abdalla Hamdok announced decision to dismantle  the regime of ex-president Oman Hassan al-Bashir who was deposed in April this year after country-wide protests against his 30 year rule. His National Congress Party was dissolved and its assets taken over. Its members were forbidden to contest any election for next ten years. Al-Bashir is in a Khartoum prison awaiting trial. He is also wanted by International Criminal Court to face alleged human right violations in suppressing Darfur insurgency in western Sudan.
 
Comment:   While the measure would go some distance in meeting popular demand, given the extent of reinter economy created by al-Bashir and his Nomenklatura over past three decades, it would be a protracted and messy process. Moreover, many of those are still in power and enjoy positions of authority.
 
Syria
The UN sponsored meeting of Syria’s Constitutional Committee met twice in Geneva on Nov 9 and 29 respectively, without any breakthrough. The Committee, comprising of representatives of the Assad government, the opposition groups and the NGOs, failed to even agree on the agenda of future talks to reform the Syrian constitution.
 
US Defence Secretary Mike Esper said on Nov 14 that his country has deployed nearly 600 troops in north-eastern Syria.
 
A meeting of 70-country coalition against Islamic State in Iraq and Syria (ISIS) met in Washington on Nov 15, but failed to overcome their differences over repatriation of nearly 10,000 ISIS fighters and their dependents in various camps in north-eastern Syria.
 
Turkish authorities blew hot and cold over their campaign against YPG/SDF in north-eastern Syria. On one hand they claimed that 200 syrians have returned to the region; on other hand they threatened to resume the offensive against Kurds unless they withdrew from the demarcated territories. They also said that the Turkish forces would remain in Syria till other forces withdrew. The matter was also discussed during Erdogan-Trump summit in Washington on Nov 11.
 
Comment: Though sporadic military activities continued  in and around anti-Assad enclave of Idlib in north-western Syria, there was perceptible lull in hostilities elsewhere in the country. The focus seems to be shifting to management of post-conflict issues through negotiations sponsored either by the UN or by the Russia-led troika.
 
Turkey’s military campaign against SDF/YPG created a public controversy and unease within NATO.
 
Iran
Sudden rise in petrol prices by 50% or more on Nov 15 precipitated violent anti-government demonstrations which lasted five days before being firmly suppressed. Authorities sought to explain the rise on need to channel funds to poorer sections of the society and to curb their smuggling. While the accounts of nearly 400 deaths by western sources seemed exaggerated, the demonstrators vented their frustration at the dire socio-economic conditions caused essentially by the stringent US sanctions on export of the Iranian crude. Predictably, Iran’s supreme leader Ayatollah Ali Khamenei called the demonstrators “thugs”, US President Trump expressed his solidarity with them.
 
On Nov 11, International Atomic Energy Agency reported “Since 9 November 2019, Iran has been conducting uranium enrichment at the plant,” – in its bid to incrementally breach the terms of the JCPOA.
 
Comment: While Iranian authorities were able to control the law and order situation and restore normalcy, the domestic unrest, in tandem with similar pressure on pro-Iran governments in Iraq and Lebanon exposed Islamic Republic’s vulnerabilities.
 
Yemen
Five year old conflict in Yemen saw a number of developments towards general de -escalation and eventual resolution. On November 5, Internationally recognised Yemeni government of President Abd-Rabou Al-Hadi signed a power-sharing agreement with Southern Transitional Council (STC) in Riyadh in presence of Saudi Crown Prince Mohammed bin Salman and UAE’s de facto ruler Mohammed bin Zayed. The conflict between the two sides has been a “civil war within civil war” haemorrhaging the fight against al-Houthis and causing friction friction between Saudi’s and the UAE, which has backed the STC in their campaign to create separate South Yemen.
 
In his report to the UN Security Council, UN Special Envoy Martin Griffiths stated that Saudi-led coalition forces air attacks have come down by 80%.
 
Saudi released 128 al-Houthi prisoners on November 28.
 
In his annual address to the Majlis al-Shoura on Nov 20, Saudi King Salman bin Abdulaziz said that despite been subject to 286 missile and 289 drone attacks, Saudi Arabia wanted a political settlement in Yemen.
 
A Saudi tug and South Korean oil exploration vessel were released by al-Houthis on Nov 20 after brief detention in the Red Sea.
 
Following installation of a civilian government in Khartoum, Sudan, a member of Saudi-led coalition, has reduced its troop deployment from 15,000 to 5,000. Earlier in September, the UAE announced its total troop withdrawal from Yemen.
 
Comment: Yemeni civil war, now in its sixth year, has caused over 100,000 deaths and pushed 12 million people into famine conditions.  Saudi-led coalition’s Gradual moves away from pursuing the war against al-Houthis is rooted in various reasons. Lack of sufficient ground troops has prevented a decisive and favourable outcome. Al-Houthis have, unexpectedly, turned out to be a tenacious foe, resorting to drone and missile attacks across much of Saudi heartland – including devastating attacks of the two vital Saudi oil installations in September. Last but not the least, with responsibility of hosting next G20 Summit next year, Saudi leadership may wish to disengage itself from a costly battle of attrition that has blighted Kingdom’s international image. Oman has facilitated indirect talks between the Saudis and al-Houthis since September which have made some tentative progress.     
 
Israel
After a longstanding investigation, Israeli Attorney General indicted Prime Minister Benjamin Netanyahu on Nov 21 on charges of bribery, fraud and breach of trust. Mr Netanyahu refused to resign and on Nov 24 the Israeli Supreme Court dismissed the petition to sack him citing various judicial provision still open in this case. However, this indictment was hitherto the most serious challenge to the longest serving Israeli Prime Minister.
 
Netanyahu’s indictment also complicated the political disarray in Israel as both the main parties failed to secure a majority coalition each after second general election this year. On Nov 21, Israeli President Reuven Rivlin ushered in three week period during which a non-party government can be attempted. If this also fails, third general election would have to be held.
 
On Nov 18, US Secretary of State Mike Pompeo announced that the Trump administration will no longer abide by a 1978 State Department legal opinion that Israeli settlements were inconsistent with international law. While he denied any political motives, the move could be seen as a integral part of Trump administration’s exceptionally pro-Israeli stance. This volte face was widely criticised, including by the UN and Red Cross.
 
Israel and Palestinian militants declare truce on Nov 15 after two days of hostilities in the Gaza strip triggered by Israeli assassination of Bahaa Abu al-Ata, a commander of Islamic Jihad. The hostilities caused 36 deaths mostly on Palestinian side.  Both sides declared a tenuous ceasefire on Thursday, bringing an initial end to the worst bout of violence in months.
        
GCC
There were tentative signs of forward movement to reunify the ranks of the Gulf Cooperation Council (GCC) fractured by 30-month rift between Qatar and four Arab powers, viz. Saudi Arabia, the UAE, Bahrain and Egypt, which accuse the former of supporting terrorism – an allegation Doha denies.
 
In a major development, Saudi Arabia, Bahrain and the UAE reversed their decision and agreed to participate in the 24th Arabian Gulf Football Cup held in Doha in the last week of November.
 
In a cryptic and delayed news item published by WSJ and Reuters on November 26, it was disclosed that Qatari Foreign Minister had paid an unpublicised visit to Riyadh sometime in October 2019 and discussed resolution of bilateral issues with “senior Saudi officials”. This news-item was neither confirmed nor denied by the two sides.
 
Comment: The GCC comprising of Bahrain, Saudi Arabia, the UAE, Kuwait, Oman and Qatar, has been largely dysfunctional since June 2017 when the first three, joined by Egypt, a non member, accused Qatar of various infractions, including support of terrorism. The four powers subsequently made 13 specific and strident demands which Doha turned down. Oman and Kuwait did not join anti-Qatar coalition. The four powers imposed an air, land and maritime blockade on Qatar and diplomatic relations disrupted. Qatar, in turn, strengthened her ties with other regional powers such as Iran and Turkey, the latter even deploying 5,000 troops at a base in Qatar. The rapprochement between Qatar and Saudi Arabia could be a part of a softening of Saudi policy along a wider axis including Yemen and OPEC+.  Moreover, the Kingdom may be keen to ensure success of G20 Summit which it is scheduled to host in November 2021 by clearing the diplomatic decks. If taken to logical conclusion, these moves could also ensure a full-fledged GCC Summit scheduled to be held in mid-December in the UAE. These visible gestures notwithstanding, it would take much longer for the GCC to emerge as a cohesive entity – given that Qatari imbroglio was only one of the many fault lines in its structure. 
 
Kuwait
The allegations of corruption and nepotism made in Kuwait Parliament and outside against three of serving Ministers led to resignation of the cabinet led by Prime Minister Jaber al-Mubarak Al Sabah on November 14. In an unusual move, Sheikh Jaber declined Amir Sabah Al Ahmed Al-Sabah’s invitation to form a new cabinet. The Amir, then nominated eldest remaining ruling family member minister, foreign minister Sheikh Sabah al-Khalid Al Sabah to serve as the next Prime Minister. In a nationally televised address, the Amir express his determination not to spare any one for misappropriation of public funds. Among the more prominent allegations were missing $790 million from defence ministry budget.
 
Comments: The politics in Kuwait is quite stable – there have been only eight prime Ministers since independence in 1960. Though Kuwaitis are proud of their political institutions, which are relatively better developed than other GCC counterparts, its parliamentary democracy has been cyclically rocked by allegations of corruption, including those between members of the royal family themselves. Moreover, media and other influencers have often played to the gallery creating surrealistic impact. 
 
 
Tunisia
Following a hung parliamentary elections in October, Tunisian political parties began negotiations to form a various political institutions. Rachid Gannouchi, 78, the veteran leader of Ennahadha was elected as the Speaker of the mono-cameral parliament. Hebib Jemli, 60, was nominated by Ennahdha to be the Prime Minister on November 19. The Constitution gives him two months to form his cabinet.
 
Comment: Despite relatively peaceful outcome of presidential and parliamentary elections, the new set up is to face daunting socio-economic challenges. The country has high unemployment, yawning fiscal and current account deficits and disconnect between political elite and the masses. While Ennahadha emerged as the largest party in the parliament, it has only 52 seats out of total 217 – making the proposed coalition government hostage to a number of vested interests. It hardly augurs well for implementation of an IMF prescribed programme under which a number of unpopular measures need being carried out.
 
Nile Water Sharing Talks
On November 6, US President Donald Trump met with Foreign Ministers of Egypt, Ethiopia and Sudan to spur long-stalemated talks on sharing of Nile river waters in the wake of near completion of Grand Ethiopia Renaissance Dam (GERD). President Trump hoped that his intervention would help resolve this contentious issue. Later in the month, the irrigation minister of the three countries met in Cairo to discuss the matter.
 
Comment: Sudan and Egypt, lower riparian countries where agriculture is dependent on irrigation by Nile water fear that recharging of GERD would harm their farmers. Ethiopian government, however, asserts that it has taken into account water needs of both these countries and Nile water is needed to ameliorate its own draught prone agriculture.

II) Economic Developments

Aramco Listing
Initial Public Offering of Saudi-Aramco opened on Nov 3 under relatively subdued conditions. While the valuation of Aramco, world’s biggest and most profitable company was put around $1.7 trillion, it was far shorter than its $2 trillion target. The share offering was reduced to 1.5% instead of 5% originally envisaged. Moreover, the offering was limited to investors in Saudi Arabia and some GCC countries. The world-wide road-shows planned were cancelled apparently due to lack of international investors who reportedly had reservations about high valuation, corporate governance, transparency, political and security-risks and long-term bearish outlook on oil economy itself. In the event, third of the IPO offer meant for retail investors was oversubscribed ($10.2 billion) a day before its closing date on Nov 28.  The IPO was eventually fully subscribed at $25.6 billion, world’s largest ever – thanks partly to help from sovereign wealth funds of Abu Dhabi and Kuwait. 

Israeli Exports
Official data projected Israeli exports of goods and services to reach $114 billion in 2019, a new record. These have grown by 4.6% over 2018 figure, with exports to India having risen by nearly twice that rate. Most of the increase came from services sector which grew by 12%.

III) Bilateral Developments

India-WANA Bilateral Developments
According to official Indian data, share of our global crude imports in October 2019 from OPEC suppliers fell to 73% – lowest since 2011. While India, world’s third largest importer normally buys around 81% of its crude from OPEC countries, it has been diversifying its sources and the US has become fourth largest supplier after Iraq, Saudi Arabia and Nigeria. India imported 4.56 mbpd during October 2019, 3.3% less than corresponding figure in 2018.
IndiGo, India’s largest airline signed a one way code-sharing agreement with Qatar Airways.

 

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