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Strategic equalization in current Syria

Giancarlo Elia Valori

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One of the most obvious results of the current stabilization of operations in Syria is the next and predictable equality of offensive potentials on the ground.

The United States, however, thinks it shall no longer deal with Syria, considering that the ultimate goal of the War on Terror is to avoid jihadist attacks on its territory or on its bases.

As often happens, psychopolitics for internal use that pretends to be  global strategy, which is indeed wrong.

Clearly, too little as US political goal. Nevertheless we have now already entered the classic overstretch cycle – “let us go back home soon” -that characterizes the American cyclical history of strategic burn and burst of US geopolitics, which works as the boom and bust cycles of financial economy, but anyway also old and Jeffersonian.

We could define it as “geopolitics of the altered states of consciousness”.

In other papers we have already analysed the issue of the US- Free Syrian Army base in Al Tanf, which is essential to protect Jordan and avoid encirclement on the Euphrates by the Caliphate jihad. Currently, however, this base is an uncertain bivouac of terrorists, although “moderate” and connected to the Free Syrian Army.

The Free Syrian Army was the first US operation in Syria. From the very beginning it was linked to the Muslim Brotherhood, but it was born during the 2011 “Arab Springs”.

If President Trump really decides to withdraw from Syria, the only highly probable future variable will be Turkey’s open invasion of  the Northern and Western Kurdish areas.

Hence, as already happened, the Kurdish Rojava will immediately head for Damascus, as it has already done, thus creating a new internal front within Syria, a harbinger of future and severe dangers.

Obviously, the hasty and strategically undefined US withdrawal is also a great and unique missed opportunity for Iran.

Iran, however, has already reached an agreement with Turkey: the stable tripartition of the areas of influence in Syria, already fully foreshadowed by the “de-escalation zones” of 2017.

Russia will certainly claim to be the strategic winner in Syria, which is what it wanted, but excluding particularly the USA and the EU from that area (certainly an easy success to be achieved).

Iran, however, will have reached its goal anyway, i.e. changing and turning to its advantage the configuration of its strategic potentials along the Syrian border with Israel and reaching up to its new Mediterranean  with the maximum political-military destabilizing power.

Once won its fight for Syria, Turkey will be in a position to afford a new area of protection and control against the unification of the Kurdish world, but will particularly ensure the smooth and undisturbed passage from Anatolia to Central Asia.

Therefore, we will have in Syria the S-300s and other advanced technologies of the Russian Defence, which will remain there in Bashar al-Assad’s hands. Nevertheless we will also have as many as 11 types of air superiority fighters in various bases (Palmyra, T4, Humaynim and two other dedicated and confidential ones), but also all the highly-advanced  set of C3 active war-control networks and of sensors, directly connected to Russia’s Central Command.

Israel finally reaches an agreement with Russia that could even allow a new arrangement of its operations in Southern Syria or even a full  agreement with the Russian Federation on the bipartite control of the Bekaa-Golan-Southern Lebanon axis, where both countries have potentially converging interests.

Moreover Iran has reached its true strategic result, the Iraqi-Lebanese “corridor”, which is modest at technological level, apart from some thefts of Russian and Turkish material, but is very effective in enabling Iran to wage its asymmetric war against Israel on a broader front, and above all new compared to the old positions.

Israel’s Kurdish friends could control this network from the North.

The Shiite Republic certainly wants to eliminate the “Zionist entity” – as Israel is called in Iran –  or make it irrelevant, but it wants above all to play  a primary role on the Mediterranean shores. This will have endless repercussions on the Shiite oil trade and on the different arrangement of  defence potentials around the Saudi axis, of which Iran wants to destabilize all its vast Shite areas, one after the other.

It will then be the turn of Bahrain and other Emirates, while the Shiite Egyptian, Moroccan, Tunisian and Algerian communities will move radially.

Considering that, for the time being, light and stable missile bases on the “corridor” are not available – although there are signs of rooting-technologically Iran’s policy line is to make every point of its “corridor” an element of mobile and variable guerrilla warfare against Israel, so as to finally set fire to the whole line and block the North of the Jewish State.

With a certain, connected and subsequent attack from the Gaza Strip and, in all likelihood, even from the areas already arranged on Israel’s Eastern  border.

Hence the quick and full deprivation of every strategic asset for the Jewish State.

Nevertheless, so far the military potentials are still asymmetric for Iran.

The missiles it has granted to Hezbollah are manifold and sufficiently advanced, but small and mainly suited to saturate Israel’s defences, so as to later propose to the Islamic world an internal and concentric attack on Israel.

Hence Israel would become a mere small terrestrial power, inevitably devoid of its technological, air, sea and signal intelligence strengths.

As already seen, however, Iran does not even trust Russia, which has no interest in permanently protecting its “corridor” northwards.

Certainly Russia does not even trust its “proxy agents” left in Syria that it wants to control permanently so as to avoid precisely what Iran wants: the clash between Russia and Israel.

A struggle that would extend ad infinitum the destructive effect of its own guerrilla warfare and of its small missiles, which today, however, are certainly much more advanced than the “toys” it supplied to Hezbollah until a few years ago.

However, the Iranian variable to command and control the phases following the outbreak of a war north of Israel is currently technological and resolves the dispute between Iran and Russia at its root.

It is a missile, namely Hoveizeh, which has been tested for the first time this February.

It is not by chance that is named after a city in South-Western Iran that bravely resisted Iraq in the Shiite “war of necessity” when the USA armed Saddam Hussein and later left him to his own destiny.

And the symbolism of the “war of necessity” comes to the fore today, on  the forty-year anniversary of the Shiite revolution.

Symbols always have essential strategic power.

Hoveizeh is a surface-to-surface missile with an average range of 1,350 kilometres, always flying at a low altitude. It needs a very short time for its preparedness and armament.

As has long been the case in Iranian arsenals, it has a fully autonomous and “national” technology.

Hence it is hard to be tracked.

The Hoveyzeh missile, however, is Iran’s direct response to the success of the recent Israeli-US Arrow (orHetz) 3missile.

Said Israeli-US missile had been tested on January 22 last.

It is an exoatmospheric anti-ballistic missile for intercepting enemy missiles which, however, can also be an attack weapon.

The Arrow 3 structure also consists of a hypersonic missile interceptor missile, also equipped with an ELM-2080 Green Pine produced by Elta, which is an AESA early warning radar, finally connected to a C3 centre and to the network of Israeli air industries known as Hazelnut.

Nevertheless it is a system that has already been declared operational in 2000.

Only the third part of the Arrow 3 system, however, has been declared fully operative in 2017.

Arrow 3 can also be used as an anti-satellite weapon, but the Israeli Forces still do not fully like it since they have always preferred the strategy of preventive attacks and deterrence. Another very problematic aspect is the high cost of this system.

Is it better to have many and possibly inexpensive missiles, with scarce  but efficient technology, or very few and expensive ones, probably even insufficient and inadequate to oppose a salvo intended to saturate the Dome?

Iran has already made its choice.

It would be interesting, however, to see Israel’s final choice in the field of the so-called “mass” missile weapons, which could also be suitable for strategies where the central point still consists in the advanced weapon, that determines in a moment the attacker’ superiority.

Also the attacker, however, must be saturated quickly.

Coincidentally, however, Arrow 3 was tested just two days after Hoveizeh, at the base of Palmachim, Israel, but there will soon be further tests on the island of Kodjak, Alaska.

Arrow 3 was tested after an Iranian missile, launched from the Syrian skies on January 28 last, had been intercepted by the Israeli structure.

However, over the last few days, a significant number of Iranian carriers has been launched onto Israel: a Fajr 5 (with a 35-kilometre range) on December 29 last, and a Fatteh 100 (with a 300-kilometre range) onto the Golan on January 21 last, which was also intercepted.

Many other smaller ones were fired.

Hence, while Israel and the United States are developing hypersonic missiles capable of striking outside the atmosphere, Iran is following  exactly the opposite policy, i.e. manufacturing fully traditional missiles, albeit capable of long flying at a low altitude, since so far no one can define valid interception techniques before the missile has actually been launched.

Israel has also recently used missiles (such as the Delilah, with a 250-kilometre range) that have not been intercepted by Russia or Syria.  The United States still has the old Tomahawk missiles in the Middle East and Russia uses its most recent Kalibr, but they are all controllable only after being launched, if all goes well.

A solution to the problem is the missiles fired by ships which, however, can be useful only if they operate in an area already full of sensors and radars.

Even in this case, these operations are traceable only for large sea and land areas and for the main launches only. This tactic is essentially useless to counteract surface missiles at a low altitude.

Hence Israel currently operates with a high-tech strategy, which strikes selectively and in the best of times, with a view to weakening the Iranian enemy and making its mass attack with small surface warheads useless.

But will it be enough? I do not believe so.

It should, however, be possible for Israel to respond quickly with equal and opposite saturation so as to avoid the temporary blindness of sensors and the excess cost of very “American-style” technologies, which are extremely top range but often of little effect.

Before leaving Syria, however, also the United States carried out attacks there. Just on February 3 last, an attack was launched between Abu Kamal and Deir Ezzour, with probable collateral damage to the Syrian artillery.

On February 2 last, three Iranian missiles were ready to be put into action at the US base of Ain Al Assad in Anbar, but they were not activated only thanks to the Iraqi intelligence services.

This means that Iran wants the United States not only out of Syria, but also out of  Iraq.

Without this preventive “cleansing” of the territory, which primarily regards the stabilization of Iranian missile forces, all the variables of command, direction and response against Iranian missiles – anyway large and numerous – are too dangerous for the Shiite Republic itself.

Probably, however, the missile bases that the USA hit on February 3 last were those of the Pasdaran’s Al Qods Force.

In that region there are also the bases of an Iraqi Shiite militia under the  Al Quds’ command, namely the Kataib Hezbollah that serves as a line of communication between the Iranian forces in Iraq and those in the Lebanon.

An essential axis of the “corridor”.

From this viewpoint, President Erdogan’s new anti-Semitic policy is certainly functional to the new Syrian stability. In fact, Erdogan has recently had Dawud Baghestani – the Secretary of the Israeli-Kurdish Friendship Association, who is also the editor of the official Kurdish-Israeli magazine – arrested.

Therefore President Trump has completely abandoned both Israel and the Kurds in Syria. Hence it is obvious that now Turkey wants to control the whole Kurdish area, thus putting in serious difficulty even Israel, which is now the only organizational, financial and military point of reference for Rojava.

The United States will certainly leave both Al Tanf- although we do not know yet how – but also the area of Al Bukhamal, on the Iraqi borders, the last stretch of Western protection between the Iranian area and the Syrian world.

This is precisely the point that is still missing to close the well-known “corridor”.

President Erdogan’s political aim is to demonstrate that there is still a link between US and Israeli intelligence services and the Kurds, which would be the greatest possible justification for a final takeover of Rojava.

Hence it is a matter of concealing – with an alleged operation of the Turkish intelligence services – Turkey’s willingness to take and control the whole of Northern Syria where there is a Kurdish majority.

Here the war of words between Israel and Turkey is always very clear in its strategic aims.

In fact, two years ago Prime Minister Netanyahu stated that Israel considered the PKK a “terrorist group”, unlike what Turkey had always said about Hamas.

Again on that occasion, however, the Israeli Prime Minister stated that one thing was to combat terrorism, even the Kurdish one, while another thing was to accept the free claim of the Kurdish people to have their right to freedom and autonomy, which Israel supported.

In other words, if the United States leaves and Turkey continues to avoid any opening to the autonomy of the Kurdish territories in Syria, without anyway putting them in communication with the Turkish-Anatolian territories, Rojavawill become the preferential target of Israel’s attention and designs.

Israel will take advantage of its old excellent relations with the Kurds to use them both against the Iranian-Lebanese “corridor” and to avoid Iranian, Syrian or other pressure on the Northern borders between Israel and Syria.

As well as to deal –  possibly from an indirect position of strength – even with Russia which, however, has no interest in using the Kurdish area  against Iran or Turkey.

Obviously Putin has already announced he will never accept a Turkish invasion of Syria for the Kurdish territories, nor the Turkish control of the YGP-controlled Kurdish areas.

Hence a new structure and organisation of central Syria: Israel plays the Kurdish card, knowing that Turkey cannot take it due to its relations with Russia, which would block any Turkish interest in Syria.

Therefore any agreement between Russia and Israel envisages a possible control zone of the “corridor”, well before the 80 kilometres set by Israel, as well as a new positioning of Syria within the Russian sphere of influence.

This means that Russia could also tolerate the line between Iran and the  Lebanon, but it would certainly put the former in a position to accept pressing remote or direct systematic checks on the corridor.

As well as additional security on the Lebanese coasts by Hezbollah that now operates near the Russian military ports of Latakia and Tartus.

This could also reduce the mass of missiles deployed by Iran and Hezbollah in the Bekaa-Golan region, although always remaining well beyond the threshold of lethality and, above all, of saturation of the attack areas in Israel’s metropolitan territory, which is the true target of Iran and its regional allies.

Therefore Turkey shall place itself at the edges of the Kurdish region, albeit with all the possible operations of intelligence and strategic harassment.

Israel could control the “corridor” also from the North, even in partial autonomy from Russia.

Russia shall keep control of central Syria (the Sunni area, in particular), but in a stable and non-adverse relationship with the Kurds.

Moreover Iran shall fight with some not fully opposed factions of the Kurdish world on the Iraqi borders. However, under these conditions, Bashar al-Assad’ Syria will hence have the possibility to filter all the funds for reconstruction, but with the Russian-Chinese permission.

Nevertheless, once again the real political issue is to manage the Lebanese chaos, which is largely agreed among the real leaders of the region.

For obvious reasons, these leaders do no longer include Bashar al-Assad. However, Saudi Arabia counts very much, with its current policies for enslaving the old political-business classes of the coastal area.

And if Saudi Arabia decides to play a role, it mainly plays its own and, only residually and on the sidelines, it plays the Turkish role.

As is well-known, after nine months, Saad Hariri – the former expensive “guest” of the Ritz-Carlton hotel in Riyadh – had to leave in Saudi Arabia much of the funds he held abroad, but not directly in the Lebanon.

The construction company Saudi Oger had a 3.5 billion debt with the Saudi banks – a debt promptly repaid mainly thanks to Mohammed Bin Salman’s prompt favours.

Now freed from his severe outstanding accounts and matters in the Saudi Kingdom, Saad Hariri is still and again President of the Lebanese Council.

However, at a price which is certainly not good even for Mohammed bin Salman.

The price of forming a government basically in Hezbollah’s hands.

The Shiite militia was given three Ministries, including Health, a Ministry  that is worth one fourth of government spending.

Hariri’s government should above all manage to release a share of foreign funding to the Lebanon of at least 84 billion, equivalent to 150% of the local GDP, with a view to solving many problems, including  unemployment which is around  36%.

All money fuelling Hezbollah, which uses a lot of public money for organizing its militias and managing its charitable activities and institutions, which are also guerrilla warfare, coverage and training structures, where necessary.

Probably only Hezbollah will solve the electricity crisis, which is structural in the Lebanon, thus creating a further basis of support and militancy to cover military operations or even to develop an attack strategy from Southern Lebanon.

The creation of the government was compulsory: the World Bank had threatened to immediately transfer to Jordan the 4 billion US dollars of funding previously envisaged for the Lebanon, if the country had not decided to form a government soon.

Corruption is always very widespread in the Lebanon, which is one of the twenty most corrupt countries in the world.

Hence the State does not exist there.

Now, however, at the core of the Lebanese power system there is the Head of Hezbollah, Hassan Nasrallah, whose primary ally is Michel Aoun, a Maronite Christian closely linked to Iran and Syria. There is also Foreign Minister Gebrane Bassile, son-in-law of President Aoun, but also very close- personally – to Hezbollah.

As is now well-known, Israel’s policy line has always been to preliminary destroy the Hezbollah tunnels in its territory and elsewhere.

On November 3 last, Prime Minister Netanyahu made it clear that those operations would continue and should also be provided some coverage from the United States and even from the irrelevant EU.

At this juncture, however, there is a clear link between the US withdrawal from Syria and the persistent Israeli operations in the Lebanon.

In particular, this clearly means that the United States will no longer be in a position to put pressure on Aoun and the new Lebanese government, with a view to marginalizing Hezbollah.

Hence Israel has currently no support from the United States for its actions against the Hezbollah tunnels, which are still located in some Caliphate’s pockets on the border between Syria and the Lebanon.

The US leaders have already said to the Lebanon that the Hezbollah leaders shall not use government funds to wage war against Israel.

Good intentions, especially in foreign policy, are welcome because they make us smile and relax.

Exactly the opposite happened in the division of Lebanese Ministries.

The Treasury Minister is Hassan Khalil, a man of the old Shite movement “Amal”. Elias Bou Saab, a businessman very close to Aoun, was appointed Defence Minister. The Health Ministry, a traditional focus of Hezbollah, was assigned to Jamil Jabak, a Shiite doctor who is very well known in the local scientific community but is, above all, a man very close to Iran.

Westerners – who are real geniuses – support Hariri, but not much of his government.

The squared circle of geopolitics.

The Interior Ministry was assigned to Raja al-Hassan, an important woman linked to Hariri’s party, but in excellent relations also with Iran and, indirectly, with Hezbollah.

Thus, in the Lebanon, there will be an officially “pro-Western” government, albeit with a wide para-Iranian majority, which will lead the country to support any Hezbollah actions in Israel.

Advisory Board Co-chair Honoris Causa Professor Giancarlo Elia Valori is an eminent Italian economist and businessman. He holds prestigious academic distinctions and national orders. Mr. Valori has lectured on international affairs and economics at the world’s leading universities such as Peking University, the Hebrew University of Jerusalem and the Yeshiva University in New York. He currently chairs “International World Group”, he is also the honorary president of Huawei Italy, economic adviser to the Chinese giant HNA Group. In 1992 he was appointed Officier de la Légion d’Honneur de la République Francaise, with this motivation: “A man who can see across borders to understand the world” and in 2002 he received the title “Honorable” of the Académie des Sciences de l’Institut de France. “

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As Marsha Lazareva languishes in jail, foreign businesses will “think twice” before investing in Kuwait

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IF THERE IS one thing to glean from the case of Marsha Lazareva, it’s that foreign businesses must now think very carefully before investing in Kuwait.

For more than a year, Lazareva, who has a five-year-old son and is one of Russia’s most successful female investors in the Gulf, has been held in the Soulabaiya prison by Kuwaiti authorities. Those authorities claim she ‘stole’ half a billion dollars, a claim she strenuously denies.

Human rights groups and prominent officials, including the former FBI director, Louis Freeh, and Jim Nicholson, former Chairman of the Republican Party and former US Ambassador to the Vatican, have called for her release and expressed concerns about the apparent absence of due process in a country where Lazareva has worked for over 13 years. Both Freeh and Nicholson visited Kuwait in recent weeks with Neil Bush, son of the late President George H. W. Bush. Bush has said Lazareva’s incarceration ‘threatens to darken relations between the U.S. and Kuwait, two countries that have enjoyed a long and prosperous relationship.

Russian officials have been equally concerned. Vladimir Platonov, the President of the Moscow Chamber of Commerce and Industry, confirmed that a single witness gave testimony in Kuwaiti court, and only for the prosecution. ‘I myself worked in prosecution for more than eight years, and I cannot imagine any judge signing off on an indictment like this,’ he said. ‘One fact of particular note is that Maria was given 1,800 pages of untranslated documents in Arabic.’

Serious questions surrounding the safety and future viability of investing in Kuwait are now being raised. Through The Port Fund, a private investment company managed by KGL Investment, Lazareva has contributed hundreds of millions of dollars to local infrastructure and economic development projects during her time in the country. Until 2017, when a Dubai bank froze $496 million without cause, she had worked largely unobstructed.

But as things stand, more foreign investment is unlikely to be forthcoming. Jim Nicholson has said that the ‘imprisonment and harassment’ of Lazareva ‘threatens’ U.S. support. adding that the ‘willingness of the U.S. to do business with Kuwait’ is based on ‘its record as a nation that respects human rights and the rule of law’. Mark Williams, the investment director of The Port Fund and a colleague of Lazareva’s, has called on international investors to ‘think twice before doing business in this country’. 

These comments will surely concern the Kuwaiti government, who said last year that FDI was ‘very crucial’ to the success of its Kuwait Vision 2035 road map. In September 2018, the FTreported that the government planned to reverse its traditional position as an investor in order to diversify its economy, carrying out a series of reforms designed to facilitate foreign investment and assist investors.

But despite these changes, which have propelled Kuwait to 96th—higher than the Middle East average—in the World Bank’s ‘Ease of Doing Business’ report, investors may be unwilling to take the risk so long as Lazareva remains in jail. Lazareva’s lawyers have accused Kuwait of violating international law by breaching a long-standing bilateral investment treaty with Russia. Lord Carlile of Berriew, QC has brought the case to the attention of the British public and the EU, writing in The Times that ‘there is no evidential basis to justify any claim of dishonesty, corruption or any other criminal wrong’. He added: ’Anyone thinking of doing business in Kuwait should read on with mounting concern.’

What’s worth remembering is that Kuwait is an important, long-standing ally of the UK, and a country generally seen as stable and fair. It is equally a major non-NATO ally of the United States, where there are more than 5,000 international students of Kuwaiti origin in higher education. But these relationships, and the investment to which they have historically led, have been cast into doubt. And it now seems certain that relations will continue to sour so long as Marsha Lazareva languishes in Soulabaiya.

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Economic reform in the Gulf: Who benefits, really?

Dr. James M. Dorsey

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For Gulf leaders, long-overdue economic reforms were never going to be easy.

Leaders like the crown princes of Saudi Arabia and the United Arab Emirates, Mohammed bin Salman and Mohammed bin Zayed, quickly discovered that copying China’s model of economic growth while tightening political control was easier said than done. They realised that rewriting social contracts funded by oil wealth was more difficult because Gulf Arabs had far more to lose than the average Chinese. The Gulf states’ social contracts had worked in ways China’s welfare programmes had not. The Gulf’s rentier state’s bargain—surrender of political and social rights for cradle-to-grave welfare—had produced a win-win situation for the longest time.

Moreover, Gulf leaders, struggling with mounting criticism of the Saudi-UAE-led war in Yemen and the fall-out of the killing of journalist Jamal Khashoggi, also lacked the political and economic clout that allowed China to largely silence or marginalise critics of its crackdown on Turkic Muslims in the troubled northwestern province of Xinjiang.

The absence of a welfare-based social contract in China allowed the government to power economic growth, lift millions out of poverty, and provide public goods without forcing ordinary citizens to suffer pain. As a result, China was able to push through with economic reforms without having to worry that reduced welfare benefits would spark a public backlash and potentially threaten the regime.

Three years into Mohammed bin Salman’s Vision 2030 blueprint for diversification of the economy, Saudi businesses and consumers complain that they are feeling the pinch of utility price hikes and a recently introduced five per cent value-added tax with little confidence that the government will stay the course to ensure promised long-term benefit.

The government’s commitment to cutting costs has been further called into question by annual handouts worth billions of dollars since the announcement of the reforms and rewriting of the social contract to cushion the impact of rising costs and quash criticism.

In contrast to China, investment in the Gulf, whether it is domestic or foreign, comes from financial, technology and other services sector, the arms industry or governments. It is focused on services, infrastructure or enhancing the state’s capacities rather than on manufacturing, industrial development and the nurturing of private sector.

With the exception of national oil companies, some state-run airlines and petrochemical companies, the bulk of Gulf investment is portfolios managed by sovereign wealth funds, trophies or investment designed to enhance a country’s prestige and soft power.

By contrast, Asian economies such as China and India have used investment fight poverty, foster a substantial middle class, and create an industrial base. To be sure, with small populations, Gulf states are more likely to ensure sustainability in services and oil and gas derivatives rather than in manufacturing and industry.

China’s $1 trillion Belt and Road initiative may be the Asian exception that would come closest to some of the Gulf’s soft-power investments. Yet, the BRI, designed to alleviate domestic overcapacity by state-owned firms that are not beholden to shareholders’ short-term demands and/or geo-political gain, contributes to China’s domestic growth.

Asian nations have been able to manage investors’ expectations in an environment of relative political stability. By contrast, Saudi Arabia damaged confidence in its ability to diversify its oil-based economy when after repeated delays it suspended plans to list five per cent of its national oil company, Saudi Arabian Oil Company, or Aramco, in what would have been the world’s largest initial public offering.

To be sure, China is no less autocratic than the Gulf states, while Hindu nationalism in India fits a global trend towards civilisationalism, populism and illiberal democracy. What differentiates much of Asia from the Gulf and accounts for its economic success are policies that ensure a relatively stable environment. These policies are focused on social and economic enhancement rather than primarily on regime survival. That may be Asia’s lesson for Gulf rulers.

Author’s note: first published in Firstpost

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Ratcheting up tension: US designation of Revolutionary Guards risks escalation

Dr. James M. Dorsey

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The stakes in the Middle East couldn’t be higher.

Suspicion that the United States’ intent is to change the regime in Tehran rather than its officially stated goal of forcing Iran to curb its ballistic missile program and support for militias in Lebanon, Gaza and Yemen was heightened with this week’s decision to designate the Iranian Revolutionary Guards Corps (IRGC) as a terrorist organization.

It was the first time that the United States labelled a branch of a foreign government as a terrorist entity, particularly one that effects millions of Iranian citizens who get conscripted into the military and for whom the IRGC is an option.

“Today’s unprecedented move to designate the IRGC as a Foreign Terrorist Organization demonstrates our commitment to maximize pressure on the Iranian regime until it ceases using terrorism as tool of statecraft,” tweeted Mr. Trump’s national security adviser, John Bolton..

The designation effectively blocks Mr. Trump’s potential successor from possibly returning to the 2015 international accord that curbed Iran’s nuclear program, complicates any diplomatic effort to resolve differences, and changes the rules of engagement in theatres like Syria where US and Iranian forces operate in close proximity to one another.

“Through this, some US allies are seeking to ensure a US-Iran war or to, at a minimum, trap them in a permanent state of enmity,” said Trita Parsi, head of the National Iranian American Council, referring to Saudi Arabia and Israel.

The designation was likely to embolden advocates in Washington, Saudi Arabia and Israel of a more aggressive covert war against Iran that would seek to stoke unrest among the Islamic republic’s ethnic minorities, including Baloch, Kurds and Iranians of Arab descent.

Both Saudi Arabia and Israel were quick to applaud the US move. Israeli prime minister Benyamin Netanyahu, on the eve of a hard-fought election, claimed credit for the suggestion to designate the IRGC. The official Saudi news agency asserted that the decision translates the Kingdom’s repeated demands to the international community of the necessity of confronting terrorism supported by Iran.”

The risk of an accident or unplanned incident spiralling out of control and leading to military confrontation has also been heightened by Iran’s response, declaring the US military in the greater Middle East a terrorist entity.

The US move and the Iranian response potentially put US military personnel in the Gulf as well as elsewhere in the region in harm’s way.

The designation also ruled out potential tacit US-Iranian cooperation on the ground as occurred in Iraq in the fight against the Islamic State and in Afghanistan. That cooperation inevitably involved the IRGC.

Beyond geopolitical and military risks, the designation increases economic pressure on Iran because the IRGC is not only an army but also a commercial conglomerate with vast interests in construction, engineering and manufacturing.

It remained however unclear to what degree the sanctions would affect the IRGC, which, already heavily sanctioned, does much of its business in cash and through front companies.

US policy, even before the IRGC designation, had already raised the spectre of a nuclear race in the Middle East. The designation increases the chances that Iran will walk away from the nuclear agreement.

Saudi Arabia has however already been putting in place the building blocks for its own nuclear program in anticipation of Iran abandoning the agreement and returning to its full-fledged, pre-2015 enrichment project.

The IRGC goes to the heart of the Iranian regime. It was formed to protect the regime immediately after the 1979 revolution at a time that Iran’s new rulers had reason to distrust the military of the toppled shah.

Some of the shah’s top military and security commanders discussed crushing the revolution at a dinner on new year’s eve 1978, some six weeks before the shah’s regime fell. It was the shah’s refusal to endorse their plan that foiled it. The shah feared that large-scale bloodshed would dim the chances of his exiled son ever returning to Iran as shah.

The IRGC has since developed into a key pillar of Iran’s defense strategy which seeks to counter perceived covert operations by the United States, Saudi Arabia and Israel by supporting proxies across the Middle East.

It is a strategy that has proven both effective and costly, Iran’s failure to address fears that the strategy is an effort to export its revolutions and topple the region’s conservative regimes, particularly in the Gulf, has raised the cost.

To be sure, the Iranian revolution constituted a serious threat to autocratic rulers. It was a popular revolt like those more than 30 years later in the Arab world. The Iranian revolt, however, toppled not only an icon of US power in the Middle East and a monarch, it also created an alternative form of Islamic governance that included a degree of popular sovereignty.

The revolution unleashed a vicious cycle that saw Gulf states fund the eight-year long Iran-Iraq war in the 1980s in which up to one million people died; Saudi Arabia wage a four-decade long US$100 billion campaign to globally propagate ultra-conservative, anti-Shiite, anti-Iranian strands of Islam; repeated attempts to stoke ethnic tensions among Iran’s disgruntled minorities, and Iranian counter measures including support for proxies across the Middle East and violent attacks against Americans, Israelis, Jews and regime opponents in various parts of the world.

“Given that the IRGC is already sanctioned by the US Treasury, this step is both gratuitous and provocative. It will also put countries such as Iraq and Lebanon in even more difficult situations as they have no alternative but to deal with the IRGC. It will strengthen calls by pro-Iran groups in Iraq to expel US troops,” said Barbara Slavin, an Iran expert at the Washington’s Atlantic Council

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