As the sun sets on 2015, the MENA region continues to suffer from political instability, regional insecurity, and a weak economic climate.
It has been five years since the Arab Uprisings erupted in the MENA region; shaking all grounds of oppression, and reshaping the region’s mold politically, economically, and socially.
The uprisings of 2011 liberated years of political and economic dysfunctions, highlighting the need for new paradigms to take over. Nevertheless, as the process of political transition is taking place, countries of the MENA region have been suffering from increasing turbulence and insecurity.
On the one hand, ISIS ascended as the most pressing security threat in the region’s modern history; Syria, Iraq, Libya, and Yemen sank into the ranking of failed states, and the Sunni-Shi’a divide intensified throughout the Levant.
On the other hand, the Tunisian National Dialogue Quartet found a way forward with a new constitution, winning a Nobel Peace Prize; Jordan has managed to maintain stability despite massive refugee inflows, and Morocco continued to be a powerful monarchy, focusing on becoming a leading energy provider in the region.
With this in mind, below are four key security and political risks and trends that shaped events, and affected markets in 2015.
ISIS
Over the past year and a half, ISIS arose as the most radical security threat, not only in Syria and Iraq, but also in the MENA region as a whole; spreading its terror across borders, and challenging national and regional security. The most obvious impact of the spread of ISIS is visible through trade.
A recent report published by the World Bank on the economic impact of the Syrian war and the spread of ISIS, calculated that the six economies of the greater Levant collectively – Syria, Iraq, Lebanon, Turkey, Jordan and Egypt – had lost almost US$35 billion in output, an aggregate cost equivalent to Syria’s entire GDP in 2007.
The Syrian Crisis
Over the past year, the Syrian crisis has best resembled the interconnectedness between the local, the regional, and the global in politics. With the increased inflow of refugees in the MENA, Europe, and North America, the fight against terrorism and radicalization on Syrian grounds, the sudden Russian military build-up in Syria, or Turkey’s involvement, the Syrian crisis continued to be a risk on the political, economic, and social levels.
With the UN Security Council’s recent resolution 2254, there could be a beam of hope for a political solution in Syria, which in turn would affect the economic climate in the Levant and the region as a whole. Nevertheless, it must be noted that the only feasible solution to the Syrian Crisis is a comprehensive one that addresses the future of President Bashar in a post-Bashar arrangement, the Islamic State, the refugee crisis, and the rebuilding of the Syrian state.
Iranian Nuclear Deal
The historic Iranian Nuclear Deal with P5+1 earlier in July 2015, marked the beginning of a new era in the West-Iranian relations. The deal lifted the sanctions on Iran, allowed a legal and safe transfer of resources into the country, yet did not include any agreements regarding its regional policy in the Middle East.
This deal affected the Iranian relations with several other parties in the region, including the Gulf Cooperation Council Countries (GCC) and, in particular, Saudi Arabia and the UAE; hardliners in Iran and their counterpart conservative movements in the US and Europe; and Israel. As the deal went into effect, more questions were raised on the possibility of aggravating regional conflicts and consequently amplifying militarization in the MENA region.
Increased Influx of Refugees
The increased inflows of refugees from Syria into its neighbouring countries including Lebanon, Jordan, Iraq, and Turkey, has changed regional demographics and caused the biggest humanitarian disasters of modern times. Refugee inflows were not only restricted to the Syrian Crisis, but also Libya, Iraq, and Yemen who have been a major source of population movements into neighbouring countries. With the continued conflicts in the region, tightened natural resources, and unemployment, the challenge of massive population movements was a key political hurdle throughout 2015.
