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Riots in Iran

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Protests against the petrol price rise and rationing in Iran began on November 15 in Ahvaz, when the Iranian government announced the fuel price increase up to 300%.

 They quickly spread to major Iranian cities.

 Before the enactment of this new rule, car owners could buy up to 250 litres of petrol per month, at the subsidized price of 15,000 rial per liter, for the first sixty ones, and then at the price of 30,000 rial per litre for the additional ones.

It should be noted that currently the rial is worth0.000027 euros approximately.

The riots – strangely similar to those that gave rise to the phenomenon of the gilets jaunes in France-have erupted because the rule just approved grants a subsidized price of 15,000 rials per litre only for the first 60 litres, but obliges to pay the new price of 30,000 rials per litre after this limit.

This is unsustainable for ordinary Iranian citizens, who are forced to use cars more frequently than anyone living in Western countries’ suburbs.

Hence a 300% price rise, albeit hidden, considering that all Iranians who own a car need much more than 60 litres per month.

 The riots, which also caused some victims, initially broke out in Sirjan, but later the protests spread to Mashhad, the second largest city in Iran, and to Qods, a suburb of the capital city. They were massive and the reaction of the police, of the Armed Forces and the Basiji was not long in coming.

For Iranian consumers the issue of oil rationing is part of the strategic triangulation between Iran, Saudi Arabia and the United States for the geopolitical management of this commodity.

 In September 2019, in fact, there were attacks with drones, probably launched from Iraq or, also, from Yemen – in the hands of the Houthi rebels, linked to Iran – which hit some Saudi wells.

There was unanimous condemnation of the attacks in the West, but there is another issue to consider. Currently, in the Arab and Islamic world, additional extraction areas are conquered. All OPEC countries do so, thus destabilizing oil producing countries and joining them to their extraction and price system.

Indeed, the right to plunder is established in the Qur’an. “The Spoils of War” is the title of the Surah 8 of Medina’s Qur’an, which establishes (verse 8) that “the decision concerning the spoils of war is for Allah and His Messenger”.

 The Prophet, however, was entitled to a fifth (khums) of any war booty, at least since the battle of Badr (642 A.D.,the Second Year of the Hijra).

As said in verse 8:41, however, the Prophet Muhammad was entitled to one fifth of all public finances of the Islamic tribe, while all the rest was to be equally distributed among the members of the war expedition.

This is one of the foundations of the specific “Arab socialism”.

 The Prophet was also granted a further part of the booty, as a member of the war expedition.

 We are talking about cultures in which war is inherent in political action and in the economy – unlike what happens in the West, which has removed the military clash from its horizon, at its own risk. We are not referring here only to jihad.

 In the case of spoils resulting from an agreement and not from a victory on the ground, the Prophet claimed for himself the entire booty, and the traditional comments on Surah8agree on stating that “all that the earth contains has been attributed by Allah to his faction”.

 Hence the productive areas left alone by the West or subject to possible ethnic, religious or political destabilization are Al Anfal, namely booty, and the Muslims share it among themselves, according to the complex Qur’anic rules concerning war and the sharing of its spoils, many of which are found in the Caliphate tradition common to both Shiites and Sunnis.

Nevertheless, the attacks launched on the Saudi wells last September 14, 2019 – with drones, because the war is to be waged with the updated techniques and technology that Allah has provided –  caused the temporary suspension from the market of as many as 5.7 million oil barrels a day, about half of the Saudi standard production.

 From the viewpoint of the old liberal theory of competition, however, Saudi Arabia has been greatly favoured by the sanctions which, since the beginning of the Shiite revolution in 1979, have thrown Iranian oil production into crisis.

 A severe distortion of the oil market that Iran tries to oppose with direct but, above all, indirect war methods – to which Saudi Arabia responds blow by blow.

In 1995, the year in which US President Carter strengthened the sanction regime, which had begun in 1979, after the revolutionary students’ assault  on the U.S. Embassy in Tehran, the system of sanctions implied, inter alia, the prohibition to support the Import-Export Bank for transactions with Iran; the refusal to grant any commercial license to companies that broke any trade restriction rulesvis-à-vis Iran; the ban on any loan exceeding 10 million US dollars during the year, obviously by U.S. financial institutions; the prohibition of becoming an agent for bank or debt securities issued by the U.S. government in Iran; finally a ban on all the specific goods or services included in the special list of the U.S. Department of Commerce.

 In 1997, President Clinton relaxed the sanctions against Iran as a result of the election of Khatami as President of Iran, who was considered a “reformist” by the naive Western press and, above all, a political opponent of Ahmadinedjad, the future Iranian President.

 The same man who, as a university student, had warned his colleagues who were about to attack the US diplomatic offices by saying: “We must not only show hatred towards America, but also towards the atheist and materialistic Soviet Union”.

 The sanctions imposed again by the United States on Iran – with a deliberate choice by President Trump, after the US unilateral withdrawal from the Joint Comprehensive Plan of Action (JCPOA) of July 14, 2015, namely the P5+1 agreement to limit the enrichment of Iranian uranium – concern about 80% of Iran’s current oil exports.

 After the choice made by President Trump, France offered 15 billion US dollars, if Iran adhered again to the full formulation of the JCPOA prior to the U.S. withdrawal from the Treaty, certainly to favour Iran’s economic recovery, but certainly also to avoid the probable U.S. block.

Moreover, since President Trump has denounced the P5+1 Agreement, Iran’s official sources have stated that the minimum oil exports that Iran wants to maintain are 700,000 barrels a day, so as to later reach 1.5 million barrels a day, should the West still want to renegotiate the entire agreement of July 14, 2015.

 This is the reason underlying the restriction on consumption for Iranian citizens: that oil is needed to be sold and not to be distributed to Iranians at a subsidized price.

 It is said that the savings resulting from this new restrictive rule on oil consumption will benefit the poor people, but now all Iranians are becoming poor.

 Meanwhile, Saudi Arabia reached 12 million oil barrels a day in 2018, well over the six million that Iran exported in its pre-revolutionary phase.

The oil market is a “seller’s market”, as we used to say when we were still studying economics in universities.

Hence, after decades of commercial impositions and Western embargoes, all the Iranian oil industries – now devoid of any technological transfer and adequate investment – have seen their production levels plunge.

 It was precisely Iran that in 1974, under the Shah’s rule, brought the OPEC price to 11.58 US dollars per barrel, equal to the current 53 US dollars.

 It should also be recalled that in 1973, immediately after the Yom KippurWar, the Iranian Shah supported Israel and hence did not participate in the embargo of the OPEC Arab oil producing countries.

 Then Iran became the fourth largest oil producer in the world, after the USSR, the USA and Saudi Arabia, with a daily level of 5.7 million barrels a day. This happened in 1977, but that level was never reached again later.

Since August 2014, however, the oil barrel extraction price has systematically fallen to the current 30%.

 According to the latest data available, the oil barrel production cost sees Great Britain ranking first, followed by Brazil and Nigeria while, coincidentally, Iran and Saudi Arabia are competing for being the cheapest oil producing country, at least as far as extraction is concerned.

Some specialized analyses, however, suggest that Iran’s extraction cost is even considerably lower than the cost currently borne by Saudi Arabia.

This is an important factor of trade war between the two countries.

Neither Iran nor Saudi Arabia charge taxes on extraction, unlike the Russian Federation, currently the most taxed country among producers. The last one is Venezuela, which, apart from the current political disasters, has a very high tax burden for extraction alone.

Let us revert, however, to the economic-strategic duel between Saudi Arabia and Iran.

Currently the price of Iranian oil is below the price of Saudi Arabia and of other regional competitors.

 The fact that now determines Iran’s real choices is the declared IPO of Saudi Aramco, the great Saudi oil company, a deal which is worth 1.5 trillion US dollars.

 The Saudi government plans to initially sell a small amount of shares on the Stock Exchange of the Saudi capital, before assigning at least over 5% of the company.

At the beginning of the Saudi oil company’s privatization, Prince Mohammed bin Salman hoped for a higher final value, i.e. an official pricing totalling at least 2 trillion US dollars, but it has not gone so well so far.

 Saudi Aramco’s annual net profit is about 100 billion and, at the time of the IPO, the Saudi company promised to pay annual dividends of at least 75 billion.

Later the company began a series of works for infrastructure and renewables and, above all, to redress the Saudi public debt, which has been recording a deficit since 2014.

In fact, despite Saudi Aramco’s considerable liquidity, the company took out a loan of 12 billion US dollars, all collected with long-term securities.

 Shell, however, now pays a yearly 6% of its investment value as a dividend. Hence, if Saudi Aramco were really attractive on the market, the IPO total value should fall to 125 trillion US dollars.

Furthermore, the bonds already issued by the Saudi company, are now worth 4% only. Considering that bonds tend to be worth less than the foreseen growth of equity capital, this means that the Saudi oil growth rate gets lower than that of other competing sectors. Hence, inevitably, international investors tend to see oil as a declining sector.

 If we were around the corridors of MOIS, the Iranian intelligence services, and around the intelligence offices of the Revolutionary Guard Corps, we would surely listen to considerations, ideas and proposals on the possibility of making the privatization of Saudi Aramco difficult and even a failure.

Nobody knows the exact amount of the Saudi oil reserves. This is a State secret.

Moreover, all oil companies – but this holds true also for Iran – are faced with issues triggered by climate change and the worldwide fall in demand for oil and gas.

Hence, either we proceed to theirquick replacement with far less polluting oil products – and this is the reason underlying Qatar’s new strategic autonomy – or all oil investments tend to become stranded assets.

  Therefore, in this case, the world’s investors do not place their capital in this sector, but focus on financial and productive areas with higher returns.

Also the Sovereign Fund of Norway, the largest sovereign fund in the world, is currently “decarbonizing” all its investment.

To some extent because it is fashionable and for taking a politically correct approach in the energy field, much more for a rational investment choice.

Hence, as was the case with cigarettes and tobacco products-in which the international capital is no longer interested – will the same soon happen also to oil and gas?

Therefore, if capital flight from the oil sector really takes place, while the United States is fully self-sufficient, Saudi Aramco shall separately sell other shareholdings of its oil company, even if only to fund its public budget deficit and the transformation of its domestic economy into a non-oil dependent system.

Just to put in the words of its oil Minister, Zanganeh, in Iran, however, the long embargo has turned many wells into “operational museums”.

The strategic issue, however, concerns above all the United States: in 2018, for example, in the midst of the shale oil expansion, the United States became the largest oil producing country in the world, with an average level of extraction to the tune of 15 million barrels a day.

As early as the Kippur War, following Henry Kissinger’ personal mediation, the Arab oil of the first real great post-war boom in prices was traded only in U.S. dollars, with the creation of preferential and confidential channels for investment defined in an agreement between Kissinger himself and King Fahd of Saudi Arabia.

Obviously this has greatly expanded the global demand for U.S. dollars, which has enabled it to best manage its huge trade deficit while maintaining its very low rates.

 Even today, as one of the FED Governors told his colleagues of the European Central Banks, “the dollar is our currency, but your problem”.

 The United States controls all the world’s oil flows by tracking all bank transfers.

Moreover, it still maintains its military bases in 13 Gulf and Middle East countries.

This is the essential point that explains the rivalry between Saudi Arabia and Iran.

 Outside the US technological and financial cycle, Iran can only play what political scientists and economists call the free rider role.

 In contemporary political theory, the free rider is the whoever, within a group, avoids providing his contribution to the common good, because he/she believes that the group can work equally well despite his/her non-involvement.

 Free riding is literally the behaviour of those who get on the bus without paying the ticket.

 In economics, free riding is a process of underproduction or over-consumption of goods.

Currently we are basically in a situation of oil underproduction, decided by the OPEC price cartel, and also resulting from under-consumption, due to the structural decrease in oil consumption in the West, considering the great transition to renewables and the economic crisis of oil buyers.

 The goods that are usually subject to free riding are those that cannot avoid not excluding non-payers.

 The oil market cannot penalise bad payers, but the point is that it cannot even sanction those who change seller.

 If anything, the punishment is geopolitical and military.

 As Alfred O. Hirschman maintains, the free rider problem typically arises – in a cyclical way – in capitalist economies, just when a producer does not consider external costs: certainly the environmental cost in the oil and gas market, but above all the political or strategic cost connected to the goods purchased.

 This is why Shiites and Sunnis are harming each other.

 This is exactly the current condition of the relationship between Saudi Arabia and Iran, even in Pareto’s terms or of game theory.

 In the phase of Arab Springs, initially organized by the United States, Saudi Arabia – although being a U.S. stable ally throughout the Middle East – strongly opposed the operations for “spreading  democracy” staged by the United States.

 Certainly Saudi Arabia helped the Egyptian Salafists after Hosni Mubarak’s fall and later the Sunnis of various jihadist or fundamentalist origin against Bashar al-Assad’s regime. Later Saudi Arabia backed almost entirely Al Khalifa’s regime in Bahrain, where the ruling class is Sunni and the great majority of the population is Shiite.

With its Islamic Awakening project, Iran instead supported and funded some strands of the “democratic” rebellion in the Middle East and the Maghreb region, above all in Egypt and Libya (Ansar al Sharia, for example, and other groups opposing General Haftar).

Hence Saudi Arabia believes that Iran has excessively expanded its area of influence throughout the Arab world, also with the Iranian support to the Palestinian groups on the Israeli border, especially after the 2006 “August war” of Hezbollah. Later there was Iran’s commitment in favour of the Yemeni Houthi and also of the rebellious Shiite crowds in Bahrain. All those operations were seen by the Al-Saud dynasty as an illicit attempt at hegemony over the entire Arab, Shiite and Sunni world.

With a view to making more oil without extracting it or being embargoed.

  Not to mention the operations of continuous destabilization that Iran pursues in the central areas of Saudi Arabia itself.These are areas that host a large Shiite minority, mainly in the provinces with the greatest level of oil extraction.

Hence if Bahrain collapses, Saudi Arabia will interpret this destabilization as the end of the cold peace between the Iran-led “Islamic Awakening” and its area of influence, not only the Shiite one.

Clumsy as usual, however, with the sanctions against Iran or through the USA, the Westerners artificially favoured Iran’s free riding.

Nevertheless, the United States has at least a real strategic interest in the region, followed, however, by the spineless EU, which anyway counts for nothing, also internally.

  All this has given Iran the possibility of making a strategy of free riding and generalized insurgency in the Persian Gulf useful.

If, however, the two competitors avoid trying to win the whole stake, i.e. the entire and very unlikely control of the Greater Middle East, they will therefore have every interest in seeking a modus operandi, which will depend above all on the stability of the Syrian regime.

 If Bashar al-Assad succeeds in stabilizing Syria, also with the help of Russia that, in the meantime is taking a good part of Iraqi oil, the trigger for a regional clash between Iran and Saudi Arabia will be avoided, and both will have every interest in negotiating an armed peace, i.e. a clear division of the areas of influence.

 If this does not happen, we will have the long war in the Greater Middle East, with an uncertain outcome which, however, will lead to two certain results: the West and EU greater dependence on Iranian or Saudi oil products, as well as the US gradual expulsion from the region and finally the continuous attack on Israel. The ultimate scenario will be the definitive jihadist destabilization of the Maghreb region.

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. “

Middle East

China-Arab Relations: From Silk to Friendship

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China and the Arabs have a long and rich economic and cultural history, and this distinguished relationship still exists today, with a promising future. This bilateral relationship between the two nations is based on the principles of respect and non-interference in internal affairs or foreign policies. Therefore, China’s relationship with the Arabs as well as with other nations is unique and a model to be followed. If you meet a Chinese person, the first phrase will be “Alabo” or an Arab in Mandarin, and he/she will welcome you. The Chinese state’s dealings with its counterparts can be measured based on the model of this Chinese citizen. China deals with the Arabs on the basis of friendship and historical ties.

The history of Sino-Arab relations goes back to the Tang Dynasty, and these relations developed with the flourishing of trade between the two nations. Since China was famous for its high quality silk, this trade route was called the “Silk Road”. Baron Ferdinand Freiherr von Richthofen, better known in English as Baron von Richthofen, was a German traveller, geographer, and scientist. He is noted for coining the terms “Seidenstraße” and “Seidenstraßen” = “Silk Road” or “Silk Route” in 1877.

Chinese-Arab relations have developed in contemporary history. In 1930, China established official relations with the Arab Republic of Egypt and the Kingdom of Saudi Arabia. A library in China was named the “Fouad Islamic Library”, after the late Egyptian king, “Fuad the First”. In 1956, Egyptian President Gamal Abdel Nasser cut ties with China and established relations with the Communist People’s Republic of China and inaugurated an embassy in Egypt. In the same year, the Arab League established relations with the People’s Republic of China. By the year 1990, all Arab countries cut their relations with the Republic of China and established diplomatic relations with the People’s Republic of China.

In 2004, the China-Arab Cooperation Forum was established, and today it is considered a milestone for the Sino-Arab relationship. At its inauguration, Chinese Foreign Minister Li Zhaoxing delivered a speech stating:“The Arab world is an important force on the international scene, and that China and the Arab countries have enjoyed a long friendship. Our similar history, our common goals and our broad interests have been credited with enhancing cooperation between the two sides; no matter how the international situation changes, China has always been the sincere friend of the Arab world”. The China-Arab Cooperation Forum was officially established during the visit of Chinese President Hu Jintao to the headquarters of the League of Arab States in January of 2004.

Hu Jintao indicated at that time that the formation of the forum is a continuation of the traditional friendship between China and the Arab world. The Chinese president said at the time, “The establishment of the forum is conducive to expanding mutual cooperation in a variety of fields. He added that China had made four proposals; First, maintaining mutual respect, fair treatment and sincere cooperation at the political level. Second, strengthening economic and trade relations through cooperation in the fields of investment and trade, contracted projects, labor services, energy, transportation, communications, agriculture, environmental protection and information. Third, expand cultural exchanges. Finally, conducting training for the employees.”

During the second session of the forum in Beijing in 2006, China showed its sympathy for the issues of the Arab world and its interest in the peace process between Palestine and Israel, since China is a peace-loving country; it presented the idea of “a nuclear-free Middle East”. China is the best friend of the Arab countries today. Although some Arab countries have strong relations with the West whose policy does not match the Chinese policy, but all Arab countries agree on friendly and good relations with the People’s Republic of China.

The Arab citizen is not interested today in the foreign policy of the US, the deadly weapons of the US and Russia, or European culture, but rather the livelihood and economy, and this is what China provides through its wise economic policy. In 2013, Chinese President Xi Jinping launched the Belt and Road Initiative, or New Silk Road, which will restore glow to China-Arab relations; as the Arab world is in a strategic location on the initiative map. Thus, the Arab countries are an important partner for China in the initiative. Although the volume of trade exchanges between China and the Arab countries exceeded 200 billion US dollars, which increased 10 times over the past decade, there was no commercial and institutional arrangement to facilitate trade between the two sides.

China, as a peaceful and non-invasive country, aims to promote economic cooperation with Arab region on an equal basis because it considers the Arab world a historic partner. The historical experience of the Arabs with the Chinese through the Silk Road has confirmed that China differs from the nations of colonialism and imperialism, which consider the Arab region a place rich in natural resources only. In his historic speech at the Arab League, Chinese President Xi stressed that China will not seek to extend influence and search for proxies in the Middle East. The Chinese initiatives will contribute to establishing security and stability through economic development and improving the people’s livelihood, in line with the post-2015 development agenda and the aspirations of the Arab people for a better life, as the Chinese experience proves that development is the key to digging out the roots of conflicts and extremism in all its forms.

China is a neutral country and does not favor the use of violence. During the Syrian crisis, for example, the Chinese envoy to the Security Council raised his hand three times, meaning that China, with its wise diplomacy, supported the Syrian regime without entering the military war. During the recent Chinese military parade, Chinese President Xi Jinping revealed some Chinese military capabilities and thus sent a message to the enemies that China will always be ready if a war is imposed on it, and a message of support to China’s allies. The Arab region today needs a real partner who possesses economic and military power and international political influence, such as China; to ensure the success of the Belt and Road Initiative, and to consolidate the China-Arab relations and raise it to the level of a strategic alliance.

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Middle East

The analysis of developments in relations between Turkey and Israel

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The fear of Biden’s Administration, the concern over the Abraham Accords (see below), the positioning of the geopolitical status in the Middle East, and the safeguarding of interests in Israel are the main factors through which Turkish President Recep Tayyip Erdoğan seeks to improve relations with Israel which, however, he connects to the Palestinians.

The statements made by Turkish President Erdoğan’s on developments in relations with Israel have confirmed media reports of his repeated attempts to reach an understanding on several controversial issues, as well as paving the way for the re-establishment of diplomatic relations. The statements made by President Erdoğan, as well as other Turkish officials, have stressed the connection between the change in Turkish-Israeli relations and Israel’s policy towards the Palestinian issue.

The “linking principle” connecting the two issues has been a key factor in Turkish foreign policy since the 1950s, and it operates in the range between words and deeds, which at times have also led to severe crises in the relations between the two countries.

At the time Turkey opposed the partition plan, but recognised Israel and maintained diplomatic relations with it. Relations were suspended after the second Arab-Israeli war in 1956, when Turkey recalled its diplomatic representative from Tel Aviv, announcing he would not return there “until a just solution to the Palestinian issue was found in accordance with UN Resolutions”.

After rising to power, President Erdoğan has developed the aforementioned “linking principle”. Against the backdrop of Israel’s actions with the Palestinians, Turkey has increased its political and economic support for its Muslim brethren and caused crises.

President Erdoğan’s recent statements have been made against the backdrop of this policy: on the one hand, the Turkish President has expressed his country’s desire to improve relations with Israel and continue intelligence cooperation; on the other hand, he has maintained that Israel’s treatment of the Palestinians is “unacceptable”.

It is important to note that Turkey will not relinquish the “linking principle”, which differs from the principle of the new Arab normalisation, based on the separation between the Palestinian issue and relations with Israel. The so-called Abraham Accords, such as the recognition of the State of Israel by the United Arab Emirates in September last year: the third Arab country to formally recognise Israel, after Egypt and Jordan; the fourth one if we considers Mauritania’s “frozen” recognition.

The policy implemented by President Erdoğan is not only shaped by foreign relations, but is also a Turkish internal issue in which public opinion plays a key role. It seems that until elections are held in Turkey (scheduled for June 25, 2023), there will be no complete normalisation with Israel. The majority of the Turkish population supports the Palestinians and their rights, feels full solidarity for them and opposes the Israeli presence.

Moreover, President Erdoğan regards the Palestinian issue as an important factor in building a renewed Turkish Muslim national identity. These stances increase his popularity and strengthen people’s support for him and his party, as well as his authority and prestige in the Muslim world.

At the same time, however, this policy also has pragmatic implications: President Erdoğan is not severing ties with Israel, but merely creating actions that lead to symptoms of “diplomatic” crises.

Despite this wait-and-see attitude, economic ties between Turkey and Israel are flourishing. According to official data, in 2018 exports from Turkey to Israel were worth 6.5 billion dollars and imports 1.9 billion dollars (excluding diamond trade and tourism).

Following the crisis in relations and the expulsion of the Israeli Ambassador from Turkey (May 2018), exports had fallen to 4 billion dollars in 2019 and imports to 1.7 billion dollars. Although declining, there are still deep economic ties.

Trade relations, however, are not the decisive factor in determining the nature of Turkey-Israel relations. There are four issues that are believed to have led Turkey to review its relations with Israel:

1. Turkey has welcome the new U.S. President, Joe Biden, with caution and fear that he will oppose Turkish activities in the region. The U.S. leader may also be very tough on security, armaments and minority rights in Turkey. Some believe that improved relations with Israel will calm down the situation with President Biden, and the U.S. Congress and the Zionist lobby will be able to contribute to this result. It is not known, however, whether Prime Minister Benjamin Netanyahu will be as good a mediator with Biden as he was with Donald Trump.

2. Turkey is seeking to remove the isolation imposed on it due to the distribution of marine economic zones in the Eastern Mediterranean area, and is trying to bring Israel on its side to develop a joint stance and oppose such subdivisions. According to Israeli sources, Turkey has made Israel a generous offer to expand its area of control over the marine economic zones, in exchange for Turkey’ siding with Greece, Cyprus and Egypt. Israel has reacted cautiously, both because it much weighs President Erdoğan’s intentions and because it is actually interested in strengthening its relations with the above stated countries.

3. Turkey is worried about the Abraham Accords for normalisation with Israel, particularly the aforementioned one with the United Arab Emirates, and Turkey aims at limiting their influence and status as a further “undertaking” of Arab rivals. Turkey endeavours to dismantle a rising alliance between the Arab countries and Israel. After all, we wonder why Turkey is not instead trying to improve its ties with Arab countries to achieve the same goal. Could it still be because of history and traditional mutual dislike?

4. Turkey is trying to relieve the pressure on its activities in Israel and Palestine as a result of the possible improvement in relations with Israel. Turkey funds important projects in Jerusalem and Israel is trying to contain and restrain it. Conversely, an improvement in Israeli-Turkish relations could release the Israeli brake.

To date, no official Israeli response has been provided to Turkish statements. Israel’s media speak of suspicion and coldness in response to the Turkish rapprochement, with fears that President Erdoğan is preparing a ploy, a trick aimed not at improving his relations with Israel, but at sabotaging Israel’s relations and contacts with other countries.

However, leaks from senior Israeli officials indicate that their country has set conditions for restoring relations, which include ending Turkey’s ties with Hamas and transferring Turkish projects to Jerusalem through Israeli channels, as well as abstaining from voting against Israel in international organisations and adopting a balanced position between Israel and the Palestinians.

It is not yet clear what the fate of Turkey-Israel relations will be in the coming months, with President Biden in the White House and after the Israeli elections held on March 23, 2021. It is important to note, however, that Turkey will not give up the “linking principle”, which differs from the new principle of Arab normalisation, based on the separation between the Palestinian issue and relations with Israel.

The Turkish “linking principle” is a real need for Turkey- hence the Palestinian leadership must work with Turkey to maximise common goals, especially with regard to Jerusalem, the Al-Aqsa Mosque and Gaza.

Not easy steps to make, but not impossible either.

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Middle East

The Exceptionality of the Hashemite Rule in Jordan

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In the tumultuous politics of the Middle East, the Hashemite Kingdom of Jordan has traditionally steered a cautious and successful course in international relations. This course largely relies on a multidimensional foreign policy and the cementing of relations with regional and western countries. Jordan is a valuable strategic partner of the United States and the European Union in the heart of the Middle East. Amman’s strategic role is reflected in the military cooperation and joint global counterterrorism operations including as a member of the Global Coalition to Counter ISIS and in meeting the overwhelming humanitarian needs of more than 1.5 million Syrian refugees.

Jordan is also a pragmatic neighbor of Israel. The 1994 Jordan-Israel peace treaty has enabled water sharing arrangements between the two countries, security cooperation, Jordanian overflight of Israeli territory, and the conduct of joint Israel-Jordan exercises to respond to natural disasters. A representative case was the 2004 joint exercise to counter environmental effects of pollution in the Red Sea. The peace treaty has notably provided the context for enhanced economic, trade and tourism ties.

The kingdom has also served as honest broker in Palestinian-Israeli peace efforts in support of the two-state solution, always abiding with the late King Hussein’s principle that “Jordan should not be, cannot be, will not be a substitute for the Palestinians themselves as the major aggrieved party on the Arab side in a process that leads to peace”. Amman has served as credible intermediary for Israel and the Palestinians to suspend tensions at multiple occasions like for example in the old city of Jerusalem, particularly at the Temple Mount/Haram Al-Sharif where the kingdom pursues a successful administration of religious funded schools favoring moderate religious education and religious tourism. Jordanian moderation guarantees co-existence of the three monotheistic religions in Jerusalem at a time when on the contrary, counties like Turkey funnel millions of dollars in charity projects in Jerusalem promoting extreme Islamic ideologies.

Reform Programs and Initiatives

Jordan’s moderation stems from the Hashemite rule that has confronted internal and external challenges maintaining stability that is conducive to national, and western interests for the region. The exceptionality and uniqueness of the Hashemite rule derives from its historical legacy, modernity, direct descendant of Prophet Mohammed and its posture as vanguard of reforms. Among significant reform initiatives was the “Jordan First-Al Urdun Awlan” campaign of 2002-2003, that articulated a comprehensive vision of economic and political reforms. The initiative provided the formation of a national committee to deal with different economic and political issues that ultimately led to the introduction of a parliamentary quota for women and the enactment of anti-corruption measures.

A blueprint for political, economic, and social reforms was provided by the 2005 Jordanian National Agenda that approached the reform process in a holistic, rather than a piecemeal, way. Its findings produced the “We Are All Jordan-Kulna al Urdun” document. The document was a clear attempt at political reform and selected a list of fifteen priorities that paved the way for significant legislative initiatives. A prominent initiative was the enactment of an anti-corruption law that established an anti-corruption committee with broad powers and included in its definition of corruption actions related to nepotism (wasta).

An additional reform program is the Jordan 2025 National Vision and Strategy” launched in 2014that provides for economic reforms through policies and measures that aim at sustainable economic growth, support of small and medium-sized businesses, women’s participation in the labour market, financing mechanisms for public projects (PPP partnerships) and public investments on health, education and food security, digital economy, and green infrastructure. The coronavirus pandemic however has hit hard the kingdom’s economy to such an extent that economic reform initiatives are expected to bear fruits at a later stage taking into consideration the current global economic downturn considered to be the worst since the Great Depression. Jordan’s Gross Domestic Product (GDP) contracted in 2020 by 2.3 percent after growing 2 percent in 2019 due to losses in state revenues because of fewer remittances and a weakened tourism market.

To cope with the direct negative effects of the pandemic on its state budget, Jordan received $396 million from the International Monetary Fund (IMF) in May 2020 in the form ofemergency assistance. The amount of finance was specifically funneled to address the kingdom’s balance of payments needs and allow for higher spending on healthcare, and assistance to households and companies most affected by the pandemic. Despite that the IMF provided in March 2020 another multi-year $1.3 billion loan package to Jordan, the pandemic has caused at least a $1.5 billion shortfall in its balance of payments.

Modernization and Democratization

The Hashemite exceptionality legitimizes and ensures viability of rule over Jordan that constitutes a model of a modern Arab democratic country.The Jordanian leadership has taken over the last decade practical steps to unleash a deep political reform process to reflect Jordan’s vision of comprehensive reform, modernization, and development. Chief among reform measures was the introduction of a new constitution that came into force in 2011 and included amendments to 42 constitutional articles. Most prominent was the establishment of a constitutional court and an independent elections oversight commission, and the provision that the dissolution of the parliament entails the dissolution of the government. A major concession was also the curtailing of some of the King’s powers with most representative, the revoke of his power to cancel parliamentary elections. It is also noteworthy that the Jordanian leadership initiated in 2013 the Democratic Empowerment Programme called “Demoqrati” under the umbrella of the King Abdullah II Fund for Development, with the aim to instil the principles of active citizenship and empower individuals and democratic institutions.

In practical terms, the kingdom has demonstrated effectiveness and respect of democratic processes when, despite the pandemic, Amman proceeded with holding parliamentary elections in 2020. A recent poll conducted by the Centre for Strategic Studies at the University for Jordan in mid-March 2021 showed that 36% of Jordanians trust the current parliament, and 38% trust their electoral district parliament representatives, which constitutes the highest percentage of trust given to the parliament since 2014. The election of 100 new parliament members in the current House of Representatives guarantees renewal of political representation that is one of the main pillars of democracy. Elections were held in Jordan in a timely manner enhancing democratic governance and institutions. Jordanian elections were held in accordance with constitutional provisions when on the contrary at least 41 countries and territories around the world postponed national elections and referendums using the pandemic as a pretext according to data released by the Stockholm-based International Institute for Democracy and Electoral Assistance.

Overall, Jordan’s Hashemite leadership has unleashed a multidimensional reform process throughout the years that reflects the kingdom’s vision of comprehensive modernization and development in a way that can be translated into realities on the ground and provide a blueprint for a better future, not only for Jordanians, but for the people of the region.

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