The second wave of Arab uprisings that started in Sudan in December last year and extended to Algeria, Lebanon and Iraq this year have built on past experiences of political transitions during the Arab Spring, both its mistakes and achievements. Protesters from this new wave have already learned five lessons from previous transitions.

The first lesson is that toppling the head of a regime does not mean that the political regime has fallen.  In Tahrir Square on 11 February 2011, Egyptian protesters celebrated the decision of Hosni Mubarak to step down and left the square, thinking his resignation was enough to allow a democratic transition to take place. In contrast, in Sudan and Algeria, protesters continued to demonstrate after the resignation of Abdelaziz Bouteflika and the military-led ousting of Omar al-Bashir.

Protesters understood the lesson that the regime is found not only in the head of the state, but rather in the rules that govern the political sphere. By extension, political change requires changing the rules, not just the names of those in charge of implementing them.

The second lesson is that resorting to violence is the fastest way to end any hope for democratic change. Protesters who decided to take up arms offered their regimes the chance to reframe the political uprisings as civil war, as was the case in Syria. Even when armed groups manage to bring down the regime, their presence endangers the transitional phase afterwards, as is the case in Libya.

Although protesters in Sudan and Iraq have been faced with government violence and repression, they have insisted on their non-violent approach. In Sudan, the protesters responded to the massacre outside of the General Command of the Armed Forces on 3 June by organizing a mass demonstration on 30 June, which put pressure on the military to resume talks with the revolutionary forces.

The third lesson is that once the old regime has fallen, the transition period must be a collective decision-making process in which the opposition has, at least, veto power. The example of Tunisia after 2011 is a case in point. The Higher Authority for Realization of the Goals of the Revolution, Political Reform and Democratic Transition, which formulated the planned course of the transition, included representatives from across the political spectrum and civil society.

Although the military forces in Algeria and Sudan will not cease to play a political role any time soon, this does not have to mean exerting complete control over the transitional period. Sudan could offer a positive example in this regard, if it succeeds in implementing a power-sharing deal according to which a joint civilian-military sovereign council will govern Sudan during the transitional period.

The fourth lesson is that political transitions should achieve agreement on the rules of the game before proceeding to elections. In Egypt after 2011, rushed elections served to divide the political opposition and dramatically increase polarization in society. In this second wave, protesters have perceived elections as a trap which enable old regimes to reproduce themselves with new names.

In both Algeria and Sudan, protesters have resisted attempts by the military to hold elections as soon as possible. In Sudan, the agreement between the revolutionary forces and the military council postponed the elections until after the end of a three-year transitional period of technocratic rule. In Algeria, protesters are taking to the streets every Friday to demonstrate against the authorities’ decision to hold presidential elections in December.

The fifth and final lesson is that the call for change in the region goes beyond electoral democracy and extends to deep socioeconomic reforms. Iraq and Lebanon show this clearly: relatively free and fair elections have already been held but have served only to reinforce corrupt sectarian regimes.

According to the fifth wave of the Arab Barometer, the economic situation and corruption are perceived as the main challenge for Algerians (62.2%), Sudanese (67.8%), Lebanese (57.9%), and Iraqis (50.2%), while democracy is perceived as the main challenge for only 2.3%, 3.9%, 5% and 1.4% respectively.  The experience of the Arab Spring has shown people that democratic measures are only a means to an end.

Unlike in 2011, when the Arab Spring revolts enjoyed broad international support, this second wave is taking place in a hostile environment, with stronger Russian and Iranian presences in the region and an indifferent international climate. But where protesters have the advantage is in experience, and across the region they are clearly adapting their tactics to lessons learned from the early part of the decade.

The Egyptian military accounts for far less of the national economy than is commonly believed but transformations in its role and scope since 2013 have turned it into an autonomous economic actor that can reshape markets and influence government policy and investment strategies. Will the military economy contract to its former enclave status if Egypt achieves successful economic growth or has it acquired a permanent stake that it will defend or even expand?

This roundtable will mark the London launch of a Carnegie Middle East Center report on Egypt’s military economy. The report author, Yezid Sayigh, will begin the discussion with remarks on Egypt’s military economy model and offer thoughts on how external actors can engage the country’s formal and informal networks. David Butter will serve as discussant and the roundtable will be moderated by Lina Khatib.

To attend this event, please e-mail Reni Zhelyazkova. 

Over recent weeks, widespread popular protests have engulfed Iraq and Lebanon. What began as calls for reform in the context of high unemployment and endemic corruption have evolved into direct challenges to the existing political order in both countries.

In response, ruling elites have moved to protect the systems from which they draw power. In Iraq, the state has responded to protests with violence, killing more than 300 people and injuring over 15,000. In Lebanon, protesters are facing attempts at co-optation and intransigence by their leaders. These developments have served to underline the widening gap between elites and ordinary citizens and to highlight geopolitical tensions in the region that have contributed to both countries' woes.

This event will delve into what is at stake for those mobilizing in Iraq and Lebanon. Speakers will discuss the obstacles to meaningful reform and possible routes out of the current crises.

To attend this event, please e-mail Reni Zhelyazkova.

There has been a stark contrast between messaging coming from the international community and trends on the ground as Libya’s latest bout of civil war enters its eighth month.

Led by Germany, some states have been trying to build consensus for a ceasefire ahead of a summit that is expected to be held in Berlin in the next few months. Today marks the date of one of the final planning meetings for the summit.

The increasing use of drone technology, airstrikes and further influxes of fighters trend points in the opposite direction. Warring groups in Libya continue to receive support from external states, undermining international efforts to de-escalate the conflict. A UN arms embargo goes largely unenforced. As the Berlin process unfolds, there is little evidence to suggest that these external states will shift their positions.

The launch of Field Marshal Khalifa Haftar’s Libyan Arab Armed Forces (LAAF) offensive on Tripoli in April sunk a UN-planned ‘national conference’, intended to be held less than two weeks later, to negotiate a framework for transition out of Libya’s governance crisis. Yet, Haftar has so far failed in his objective of capturing Tripoli. While his offensive continues, had he the capacity to capture the city, he would have done so already.

This has created a conundrum for peace talks: there appears to be little chance of negotiating a deal with Haftar, while it is also hard to see how a deal could be reached without him.

The field marshal has little interest in accepting a withdrawal, even a partial one, of his forces. His opponents – who have found unity in their shared efforts to defeat Haftar’s forces – will not accept a ceasefire that leaves the LAAF on the hinterlands of the capital. Similarly, a deal apparently agreed in Abu Dhabi between Haftar and Prime Minister Fayez al-Serraj in February is also dead in the water.

Amid this logjam, there has been an increasing interest in the economic content of the Berlin summit. Countries supportive of Haftar argue that his alliance has legitimate concerns over the management of Libya’s economy and, particularly, the dominant role of the Tripoli-based central bank and its governor in supporting armed groups.

For some within these countries, changing the leadership of the central bank and a finding means of limiting the dominance of the UN-backed Government of National Accord (GNA) over the state’s resources – thus reducing flows of funding to armed groups fighting Haftar – could present a point of agreement in Berlin.

But their focus on financial management in Tripoli is not mirrored by interest in holding the rival central bank in the eastern city of Bayda – an institution unrecognized by the international community – to account for its pursuit of its own monetary policy. This is built on approximately $23 billion of unsecured debt from commercial banks and $11 billion of currency supplied by Russia.

Indeed, very few of the conversations surrounding parameters for Berlin contain details of what would be asked of eastern-based actors beyond pursuit of an audit of the Tripoli and Bayda central banks (only the Tripoli bank is recognized by the international community).

Clearly, the GNA and its allies would have no incentive to accept provisions that limit their means to mobilize resources for the war while its opponents do not receive the same scrutiny. 

However, it is possible to capitalize on the broad interest in economic content to reach some points of agreement over the management of the economy and state institutions. Rather than seeking to replace individuals aligned with one faction for those aligned with another, or expecting asymmetrical concessions from the GNA and its allies, this effort must instead focus on structures and processes that exacerbate the conflict and represent major grievances for the warring parties.

Importantly, this would include the establishment of a system of transparency and accountability for the management of Libya’s finances.  The opacity of current processes enables the support of patronage-based networks with no effective oversight.

Linked to this, the development of effective processes for budgeting and allocating funds could help to reduce graft.

And, finally, rationalizing the role of state institutions to agree their roles and responsibilities, creating the room for reforms to Libya’s system of state employment and subsidies through provision of direct payments to Libyan citizens, is essential.  

An economic commission that comprises members from across political and institutional divides – receiving political support from international powers and technical support from international financial institutions – could be an effective approach. Such a commission could match an inclusive, Libyan-led process with international support to progressively harmonize economic and financial policy between rival authorities and develop consensus for a process of institutional reunification in Libya.

This would constitute a major element of an eventual political settlement and reduce the risk of a limited set of actors capturing the system at the expense of the others – an outcome which would likely result in future bouts of violence.

Such a commission would offer a means of addressing a key driver of the conflict by decentralizing aspects of Libya’s governance, moving away from the dominance of Tripoli and the current winner-take-all system. 

These issues cannot be put to one side, to follow progress on the security front. The remarkable resilience that Libya’s economy has shown over the last seven months should not be taken for granted. It has become increasingly difficult for Libya’s institutions to insulate themselves from the conflict as both sides seek to mobilize resources to sustain their war effort.

The LAAF is increasingly looking to sideline civilian authorities in eastern Libya. On the other side, the GNA has found means of routing funds to armed groups fighting Haftar.

In September, a dispute over the supply of jet fuel between the LAAF and the National Oil Corporation resulted in the establishment of a parallel Brega Petroleum Marketing Company, the state-owned company that possesses a monopoly over fuel distribution.

Meanwhile, other major problems lurk under the surface.  The banking sector is in an increasingly perilous state and debts continue to mount all around, with those in the east not accounted for by Tripoli’s official authorities.  

Through the establishment of an economic commission, the Berlin process provides an opportunity and – most importantly – a mechanism to address these problems while also helping to maintain the basic functionality of the state.  Even if a ceasefire deal does not materialize, initiating negotiations about the future shape of the state and its economy would be a significant step forward.

Over recent weeks, widespread popular protests have engulfed Iraq and Lebanon. What began as calls for reform in the context of high unemployment and endemic corruption have evolved into direct challenges to the existing political order in both countries. How have the ruling elites responded to the popular uprisings? What do these developments mean for the future of the two countries and the region more broadly?

Dr Lina Khatib and Dr Renad Mansour will discuss what is at stake for protesters and what are the obstacles to meaningful and sustainable reform in Iraq and Lebanon.

Please note this webinar is for Middle East and North Africa Programme supporters only and will be taking place online.

For four decades, the rule of Iran’s Islamic Republic has rested on the pillars of redistributive social justice, foreign policy independence, Islam and a managed form of electoral legitimacy.  These pillars, each of equal importance, have served as guiding principles bolstering Iran’s domestic and foreign policy decisions.  Amid the latest round of protests to have gripped Iran, it is clear that these pillars are fracturing. 

On 15 November at midnight, the Iranian government, in a move supported by Supreme Leader Ali Khamenei, President Hassan Rouhani, Speaker of the Parliament Ali Larijani and Head of the Judiciary Ebrahim Raisi, announced a 200 per cent increase in fuel prices – a redistributive measure designed to provide cash transfers to the population.

In immediate reaction, Iranian citizens took to the streets to express their discontent with this policy move alongside mounting economic and political grievances.

What ensued over the subsequent days was an outbreak of protests through 100 Iranian cities, including at universities and bazaars, that was followed by a weeklong internet blackout and a brutal crackdown that has left at least 200 people dead and 7,000 arrested. Initially, public anger focused on the price increases but quickly targeted the political leadership, lack of government accountability, effective governance and corruption.

This wave of protests is the fourth in a two-decade period – 1999, 2009, 2017 and 2019 – for the Islamic Republic and comes at time when the Iranian government is under severe economic strain from Washington’s maximum pressure campaign. It is equally burdened by endemic factional politicking.

These protests are one of many reminders of the shattered social contract between state and society in Iran, which without repair will continue to resurface.

With internet connectivity resumed and news of the regime’s brutality spreading, conservatives and reformists are both trying to distance themselves from this internal crisis and reposition themselves in advance of the 2020 parliamentary elections.

Parliamentary elections for Iran’s 290-person legislature are expected to be held on 21 February. Amid concerns over public apathy and lower political participation, both reformists and conservatives are trying to develop strategies to maximize gains at their ballot box.

Even before these protests, voter turnout was anticipated to be lower than normal. Participation in the July 2019 Tehran municipality election was at a nadir of 9 per cent.  To prepare for this challenge, Iran’s parliament has lowered the vote threshold for a valid result from 25 to 20 per cent.

Elections in Iran, while by no means completely free and fair due to the vetting of candidates by the Guardian Council, have repeatedly been an important barometer of public support and participation. Electoral participation, which is traditionally higher than in most Western democracies, and compared to the lack of electoral opportunities in the Middle East, is heralded as a sign of public legitimacy. 

Voter participation is generally higher in presidential elections than in legislative ones.

For example, 73% voted in the 2017 presidential elections, 72% in 2013, 80% in the contested 2009 elections, and 59% in 2005 elections that brought Mahmood Ahmadinejad to office. Comparatively, in the 2016 parliamentary elections 62% voted, in 2012, 66%, in 2008, 47%, and in 2004, 51% participated.

Voter turnout in the 2008 parliamentary elections, reflective of public apathy, mounting international tensions over the nuclear programme, and Guardian Council vetting of reformist candidates, could be emblematic of what to expect next year. 

In the run up to the election, conservative groups are trying to capitalize on popular economic frustrations, disappointment with reformists, wider regional security concerns and tensions with the United States to rally voters. 

Reformists associated with the Rouhani government, who also supported the Iran nuclear agreement, have been severely weakened by the US maximum pressure campaign and the return of US sanctions.  They are also blamed for the current economic downturn and remain frustrated by their ability to affect change in a political system that affords more power to unelected figures.

Amidst this stalemate, Rouhani has continued to call for a national referendum to no avail, while reformist groups are debating how to position themselves – some even calling for greater accountability – so as not be tainted by the government crackdown. Leading reformist politicians such as Mohammad Khatami have called on reformists to stay united and avoid boycotting the elections. It remains to be seen how their strategy will develop after the protests.

Should the Guardian Council bar too many reformists from running, calls for a boycott could snowball and even incite new protests. Together with low turnout at the ballot box, the outcome of this election could further damage the regime’s already fragile electoral pillar and weaken its claims to legitimacy.

In the aftermath of the liberation from ISIS, the government of Iraq was left to count the cost of three years of brutal conflict, only the most recent phase in the ongoing cycle of conflict and stabilization that has plagued Iraq for 16 years. While reconstruction has been a focus of both the Iraqi government and international policymakers since 2003, billions of dollars in pledged funds have continually failed to reach the places they are most needed. 

At this roundtable, Ali Farhan Hamid will discuss the efforts of his provincial government to rebuild the cities and towns worst-hit by the conflict. He will provide insights into the practical and structural impediments to reconstruction efforts in both Anbar and neighbouring provinces such as Ninewah where the worst damage was sustained under ISIS but where little in the way of reconstruction has been achieved thereby leaving the door open to the potential resurgence of conflict.

The roundtable is part of the Chatham House Iraq Initiative.

An unexpected bounty for Iran

Sanam Vakil

The assassination of Qassem Soleimani has been an unexpected bounty for the Islamic Republic at a time when Iran was balancing multiple economic, domestic and regional pressures stemming from the Trump administration’s maximum pressure campaign.

Coming on the heels of anti-Iranian demonstrations in Iraq and Lebanon, and following Iran’s own November 2019 protests that resulted in a brutal government crackdown against its own people, the Soleimani killing has helped the Iranian government shift the narrative away from its perceived regional and domestic weaknesses to one of strength.  

The massive funeral scenes in multiple Iranian cities displaying unending waves of mourners chanting against the United States has provided the Islamic Republic with a unique opportunity to showcase its mobilizing potential. This potential is not limited to Iran but also extends to Iraq and Lebanon, where Tehran’s transnational summoning power has also been visible. The Iraqi parliamentary vote to end the American military presence is one early negative consequence. While the region awaits Iran’s response, further anti-American rallying cries will continue to reverberate.  

Domestically, Soleimani’s death and President Donald Trump’s continued provocations on Twitter, including threats to attack 52 Iranian cultural sites, are being used as a nationalist rallying cry. This sentiment should not be seen solely as Islamic or ideological, but rather an opportunity for the state to pivot to an Iranian-based nationalism that is more inclusive and empowering for much of the country’s disgruntled youth.

Iran’s notoriously divided political factions have also unified in the face of this crisis. With parliamentary elections looming in February and turnout previously expected to be low, the political establishment is likely to use this crisis to mobilize voters in favour of conservative candidates.  

How Tehran chooses to respond to Qassem Soleimani’s death will very much determine its ability to continue to control the narrative and manage its swell of domestic and regional support. For these benefits to continue to manifest, it is important for Tehran to balance the mix of public sympathy and international anxiety and not overplay its hand in its quest for revenge.

A reset for Iraqi politics

Renad Mansour

The US strike which killed Qassem Soleimani and Abu Mehdi al-Muhandis has grave implications for Iraq. The act jeopardizes Iraq’s recently stabilized security situation, and threatens to reshape the country’s political environment, moving backwards to the days of anti-Americanism and sect-based mobilization. If Baghdad loses relations with the US and other diplomatic representations, it risks turning into a pariah state. 

Over the past few years, and notably since October 2019, young Iraqis have taken to the streets demanding reform and the downfall of the political establishment, and its main external backer Iran. The political establishment, including political parties and militias close to Tehran, failed to appease or suppress these protests. Now, these political elites are using the deaths of Muhandis and Soleimani to (re)gain popularity from their own population, by drawing on the old tool of anti-Americanism. 

Following the attacks, Shia populist cleric Muqtada al-Sadr – who until recently had called for an end to Iranian and pro-Iranian militia influence in Iraq – has called to revamp the Mehdi Army that he led until 2008 and is calling for ‘Islamic resistance’ to the US. In seeking to regain control of his former movement, he is coming closer to former Shia foes.

For years, pro-Iranian groups attempted to push the US out of Iraq. Their calls often fell on deaf ears, as public opinion in Iraq did not consider the US as a threat and some even supported the US and international effort against ISIS. Following the attacks, however, anti-American voices have gained more ammunition.

A complete American withdrawal would not only have direct security implications but force other countries and organizations, from European states to NATO, to reconsider their positions and role.

Limited options for ‘revenge’ in the Levant

Lina Khatib

Iran’s use of Lebanon and Syria as spaces for revenge against the US is unlikely.

On Sunday, Hezbollah leader Hassan Nasrallah vowed revenge for Soleimani’s death by singling out American soldiers as a target. However, Hezbollah’s options are limited. Lebanon is in the middle of wide-ranging protests against the country’s ruling political class, of which Nasrallah is a key figure.

Unlike in 2006, when Hezbollah’s military actions against Israel rallied the public around it, today there is no public appetite for dragging Lebanon into a war. Were Hezbollah to instigate one, it would incur public anger, if only for the economic repercussions that would exacerbate an already severe financial crisis in Lebanon. Lebanon also does not have any US military bases that could be a target for Hezbollah.

In theory, Hezbollah or other Iranian-backed groups could attack American bases in Syria. But these bases are staffed by multinational forces from the international anti-ISIS coalition. Attacking them would therefore put Iran in confrontation with other countries besides the US, which is not in Iran’s interest.

Attacking US soldiers in northeast Syria would also go against Kurdish interests because it would weaken the anti-ISIS coalition front of which Kurdish forces are part. It would, furthermore, anger Arab tribes in the area, opening up possibilities for ISIS to take advantage of public dissent to stage a comeback. Iran would then find itself fighting on several fronts at once, which it does not have the capacity to handle. 

More likely, Iran’s allies and proxies in the Levant are going to engage in strong rhetoric without taking hasty actions. When a key Hezbollah leader, Imad Mughniyeh, was assassinated in Damascus on 2008, there were strong words and public vows to seek revenge for his killing, but ultimately there was no response.    

Following the tumultuous final months of 2019, the new year opened with a substantial threat to Iraq’s security and stability. The killing of Qassem Soleimani, commander of the Iranian Revolutionary Guards' Quds force, and Abu Mahdi al-Muhandis, deputy head of the Popular Mobilisation Forces threatens to reshape the country’s political environment, undermine the hard-fought gains of the international coalition against ISIS and to transform the country to a battleground once more in the conflict between the US and Iran. Meanwhile, the root causes of the protest movement remain, Iraq’s stunted economy continues to fester and reconstruction efforts in many of the areas worst-hit by the occupation of ISIS have stalled.

At this roundtable, part of the Iraq Initiative project, experts will discuss the latest developments and posit what the likely escalation of conflict will mean for Iraq’s politics, society and economy in 2020.

Attendance at this event is by invitation only. 

2019 was a turbulent year for the Middle East and North Africa. The region was swept by a wave of anti-government protests with popular unrest erupting across Algeria, Egypt, Lebanon, Iraq and Iran. Tensions in the Gulf escalated following clashes between Iran, Saudi Arabia and the United States. Nearly a decade after the Arab Spring, civil wars in Libya, Syria and Yemen continue to rage with little hope for political solutions to the crises.

At this breakfast briefing, Chatham House's Middle East and North Africa Programme researchers will discuss possible scenarios for the region in the year ahead. The experts will explore key trends relevant to the business community and will share insights from recent research trips and discussions with key stakeholders in the MENA region. 

Please note that participation in this event is only open to supporters of the Chatham House Middle East and North Africa Programme and selected guests.

This conference brings together policymakers, experts, academics and civil society leaders to explore the current condition of the state in Syria. It examines the structure, interrelations and importance of the regime’s core institutions and their interactions with international actors. It also highlights the regime’s different approaches in dealing with state institutions and non-state actors.

The speakers discuss governance dynamics in north-western Syria and the east Euphrates region and will analyse governance variations between regions within the regime-controlled areas after the dramatic changes in 2018 and 2019.

The conference also aims to evaluate the possibility for Syrians to move from a regime-led state to one that is accountable to its citizens and is governed by the rule of law.

The transition of power in Oman from the deceased Sultan Qaboos to his cousin and the country’s new ruler, Sultan Haitham bin Tariq, has been smooth and quick, but the new sultan will soon find that he has a task in shoring up the country’s economic position.

Above all, the fiscal and debt profile of the country requires careful management. Fiscal discipline was rare for Oman even during the oil price spike of the 2000s. Although oil prices only collapsed in 2014, Oman has been registering a fiscal deficit since 2010, reaching a 20.6 per cent high in 2016. As long as fiscal deficits remain elevated, so will Oman’s need to finance those deficits, predominately by borrowing in the local and international market.

Oman’s Debt-to-GDP ratio has been rising at a worrying pace, from 4.9 per cent in 2014 to an IMF-estimated 59.8 per cent in 2019. By 2024, the IMF is forecasting the ratio to reach nearly 77 per cent. A study by the World Bank found that if the debt-to-GDP ratio in emerging markets exceeds 64 per cent for an extended period, it slows economic growth by as much as 2 per cent each year.

Investors are willing to lend to Oman, but the sultanate is paying for it in terms of higher spreads due to the underlying risk markets are placing on the rising debt profile of the country. For instance, Oman has a higher sovereign debt rating than Bahrain yet markets perceive it to be of higher risk, making it costlier to borrow. Failure to address the fiscal and debt situation also risks creating pressure on the country’s pegged currency.

If oil revenues remain low, Sultan Haitham will have to craft a daring strategy of diversification and private sector growth. He is well placed for this: Sultan Haitham headed Oman’s Vision 2040, which set out the country’s future development plans and aspirations, the first Gulf country to embark on such an assessment. However, like all vision documents in the Gulf, Oman’s challenge will be implementation.

In the age of climate change, renewable energy is a serious economic opportunity, which Oman has to keep pursuing. If cheap electricity is generated it could also be exported to other Gulf states and to south Asia. In Oman, the share of renewables in total electricity capacity was around 0.5 per cent in 2018; the ambition is to reach 10 per cent by 2025.

However, in order to reach this target, Oman would have to take additional measures such as enhancing its regulatory framework, introducing a transparent and gradual energy market pricing policy and integrating all stakeholders, including the private sector, into a wider national strategy.

Mining could provide another economic opportunity for Oman’s diversification efforts, with help from a more robust mining law passed last year. The country has large deposits of metals and industrial minerals and its mountains could have gold, palladium, zinc, rare earths and manganese.

Oman’s strategic location connecting the Gulf and Indian Ocean with east Africa and the Red Sea could also boost the country’s economy. The Duqm special economic zone, which is among the largest in the world, could become the commercial thread between Oman, south Asia and China’s ‘Belt and Road Initiative.’

Oman has taken important steps to make its economy more competitive and conducive to foreign direct investment. Incentives include a five-year renewable tax holiday, subsidized plant facilities and utilities, and custom duties relief on equipment and raw materials for the first 10 years of a firm’s operation in Oman.

A private sector economic model that embraces small- and medium-sized enterprises as well as greater competition and entrepreneurship would help increase opportunities in Oman. Like all other Gulf economies, future employment in Oman will have to be driven be the private sector, as there is little space left to grow the public sector.

Privatization needs to continue. Last year’s successful sale of 49 per cent of the electricity transmission company to China’s State Grid is a very positive step. The electricity distribution company as well as Oman Oil are next in line for some form of partial privatization.

The next decade will require Oman to be even more adept in its competitiveness as the region itself tries to find its new bearings. Take tourism for instance; Oman hopes to double its contribution to GDP from around 3 per cent today to 6 per cent by 2040 and the industry is expected to generate half a million jobs by then. Over the next 20 years, Oman will most likely be facing stiff competition in this area not only by the UAE but by Saudi Arabia as well.

The new sultan has an opportunity to embark on deeper economic reforms that could bring higher growth, employment opportunities and a sustainable future. But he has a big task.

Summary

• North African integration is not a new idea. However, countries in the region have so far struggled to form a cohesive bloc with deep political, economic and social ties. Political instability has effectively deprioritized North African integration. A focus on thematic (political, economic and security) ‘synergies’ may provide a better framework for cooperation than seeking opportunities for all-encompassing ‘deep’ and ‘comprehensive’ integration.
• Governments of North Africa dedicate considerable resources to domestic security. Much of their efforts are conducted at the national-level and directed towards threats from terrorists, insurgents and militias. Improved security cooperation would achieve better outcomes and economies of scale, including efforts to tackle human trafficking.
• A new generation of jihadis has emerged in North Africa since 2011. Nearly 27 per cent of the 30,000 fighters who travelled to Syria are from the Maghreb. While government counterterrorism operations have been effective, countries have failed to address the root causes of radicalization.
• Border economies have suffered as a consequence of a security focus on terrorism and smuggling, which has rendered many previously accepted cross-border trade activities illegal. States have struggled to provide alternative livelihoods for those who have lost this source of income. Border forces tend to lack the right combination of capacity, training and equipment to secure borders and often resort to heavy-handed tactics.
• New thinking is required to develop a more human-centric and proactive approach to migration issues in the region, which continues to witness huge flows of migrants. The migration policy of Morocco, introduced through legislation in 2014, could be a model for North Africa.
• The countries of North Africa have varying economic profiles, ranging from economically diverse Morocco to oil-and-gas-dependant Libya. However, they all face similar challenges including unemployment (particularly among the young), poor public-service delivery, low FDI levels, an oversized public sector, ineffective tax collection, and high informality.
• Fostering entrepreneurship and the development of small and medium-sized enterprises (SMEs) are priorities for North African countries, particularly regarding job creation. Regulatory cooperation – such as harmonizing SME definitions, legislation and support institutions – across North Africa is an obvious area where further integration would encourage the development of start-ups and small businesses.
• With the advent of the fourth industrial revolution, North African governments must address their technological gaps and work to improve public–private cooperation. In some sectors, such as the fintech industry, North African countries can build upon nascent synergies that have developed organically, such as those of start-up incubators and angel investors that work across the region.
• Renewables, particularly solar energy production, are a promising development for North Africa. While regional initiatives, such as Desertec, have stalled due to political differences between countries, the sector has witnessed exponential growth in Tunisia, Egypt and Morocco, where the involvement of the private sector has proved successful.

A shaky truce remains broadly in place among rival Libyan forces fighting for control of Tripoli. However, a durable ceasefire to bring an end to the current bout of conflict, which was initiated by Khalifa Haftar’s Libyan Arab Armed Forces’ (LAAF) offensive on the capital in April 2019, has not been reached. In recent weeks attention has focused on talks hosted in Moscow and Berlin, with the former aimed at agreeing a ceasefire and the latter seeking to reach agreement among international actors to bring an end to external military support for Libyan warring actors, and to craft a way forward for future intra-Libyan talks. Yet, there has been little emphasis on Libyan actors – beyond Haftar and prime minister Fayez al-Serraj – in this process.
 
This roundtable will bring together experts and policymakers to discuss means of de-escalating the conflict and seeking a lasting resolution through the development of interconnected intra-Libyan social and security negotiation tracks. Mr Usama Otman Essed of the Libya Center for Strategic and Future Studies (LCSFS) will present his research group’s ideas on these issues and discuss their ongoing efforts to promote dialogue among social and security actors.

Attendance at this event is by invitation only. 

There is a broad consensus that Libya’s rentier, patronage-based system of governance is a driver, and not only a symptom, of Libya’s continuing conflict. The dysfunction of Libya’s economic system of governance has been exacerbated by the governance split that has prevailed since 2014 whereby rival administrations of state institutions have emerged. Despite these challenges, a system of economic interdependence, whereby forces aligned with Field Marshal Haftar control much of the oil and gas infrastructure and the UN-backed Government of National Accord controls the means of financial distribution, has largely prevailed. Yet, at the time of writing, this is under threat: a damaging oil blockade is being implemented by forces aligned with Haftar and those state institutions that do function on a national basis are finding it increasingly difficult to avoid being dragged into the conflict.

This roundtable will bring together analysts and policymakers to discuss these dynamics and look at possible remedies. Jason Pack, non-resident fellow at the Middle East Institute, will present the findings of his latest paper on the issue which recommends the formation of 'a Libyan-requested and Libyan-led International Financial Commission vested with the requisite authorities to completely restructure the economy.' Tim Eaton, who has been leading Chatham House’s work on Libya’s conflict economy, supporting UNSMIL’s efforts in this field, will act as respondent.

Attendance at this event is by invitation only. 

Following the US strike on Qassem Solaimani and Abu Mehdi al-Muhandis, populist cleric Muqtada al-Sadr has violently cracked down on youth-led protests in Iraq.

His paramilitaries and ‘blue hats’ –  supposedly created to protect protestors from state and allied parastatal security forces – sought to end the months-long demonstrations by attacking the places where protesters have camped since October. In Baghdad’s Tahrir Square, they successfully captured the famous Turkish restaurant which had become a symbol of Iraq’s ‘October revolution’. 

Once the champion of Iraq’s protest movement, Sadr has seemingly changed course and now leads the counter-protests. This reversal has mystified many, from Iraqis who saw Sadr as an ally in their struggle for reform against an impenetrable elite to foreign diplomats who hoped Sadr could help pushback against Iranian influence in Iraq. 

Yet this is not the first time that Sadr has drastically redefined his position. Since 2003, he has gone from Shia sectarian militia leader to pro-democracy reformist and Iraqi nationalist.

And in the past few months, he has given mixed signals, both supporting and criticising the protesters. The most recent incidents of Sadrist violence targeting demonstrators provoked a societal backlash, prompting Sadr to change tack once more and announce that he would disband the blue hats and investigate their crimes against protesters.

Sadr and the paramilitaries

Sadr’s latest change of course may seem to flow directly from the US assassination of Qassem Soleimani and Abu Mahdi al-Muhandis and the ensuing vacuum in the Shia paramilitary sphere. Prior to this move, the Sadrists were on the defensive, outflanked and outgunned by the growing coercive and political power of a constellation of Shia armed groups coalescing under Muhandis’s de facto leadership. Many of these groups competed for Sadr’s base, including Qais al-Khazali’s Asa’ib ahl al-Haq and Akram al-Kaabi’s Harakat Hezbollah al-Nujaba.  

With Muhandis out of the picture, Sadr could reclaim the space by pushing his own right hand, Kadhem al-Issawi (Abu Do’a), to be the new centre of the paramilitary field and forcing competitors, including Khaza’li and Kaabi, to rally around his leadership.

Iran, in the short term, appears to be going along with this solution to bring more coherence to its allied forces in Iraq as it seeks to counter what it regards as US aggression. Iran also hopes that bringing Sadr back in will help neutralize the protest movement which threatens its stake in Iraqi politics. 

The most visible sign of this Iran-brokered rapprochement was the 13 January meeting in Qom attended by Sadr, Issawi and several senior militia commanders including Laith al-Khazali (Qais al-Khazali’s brother). 

Following the Qom meeting, a pattern of tit-for-tat violence and assassinations between the Sadrists’ Saraya al-Salam and Asa’ib Ahl al-Haq – ongoing since the start of the October protests in Iraq – ceased.

A fragmented movement?

However, while the US strikes certainly changed Sadr’s political calculations, there are more persistent fundamentals at work that help explain his change of course. The first of these relates to long-standing fragmentation within the movement. This exists not only within Sadrist paramilitaries, but within the movement’s clerical networks, and also applies to the ties that bind the Sadrist leadership to its popular base. This fragmentation makes it difficult for Sadr to impose a coherent politics on his followers from the top down.

There are signs that Sadr’s recent shift in position has exacerbated this fragmentation. His attempt to reposition the movement’s base within the ‘resistance axis’ that supports the Shia militias in Iraq has only been partially successful. On 24 January, responding to the US assassinations, Sadr called for a million-man march focused on expelling US forces from Iraq. However, turnout was poor, especially given the huge logistical support for the march, and it lasted only a few hours.

Equally revealing, when Sadr called on his supporters to vacate the squares, many refused. One Sadrist protester in Baghdad’s Tahrir Square told the authors: ‘We’ve been camping with our brothers and sisters for four months. Why should we leave them to die?’

Meanwhile, fissures have also opened up within the Sadrists’ clerical elite. One senior Sadrist cleric, for example, is openly defying Sadr’s authority and siding with the revolutionaries in Nasiriyah. 

Sadr’s attempt to dominate the paramilitary sphere is also unlikely to prove any more successful than his many previous failed attempts since 2003. He is neither trusted nor respected by the leaders of other groups. The Iran-brokered rapprochement is already showing signs of weakness. Two recent assassinations of Saraya al-Salam leaders in Basra and Maysan indicate a potential renewal of power struggles between the Sadrist militia and Asa’ib Ahl al-Haq.  

Sadr is not a revolutionary

Sadr has never been a revolutionary, but someone who seeks to leverage a role as both ‘spoiler’ and ‘stabilizer’ to maximise his political leverage. This strategy is ultimately oriented towards sustaining Iraq’s extant political system, not its overthrow. Forced to choose between the roles of revolutionary or maintainer of the status quo, he has opted for the latter. 

The protests that erupted in 2019 were not the same movement that Sadr led from 2015. The 2015 protests were an elite-driven phenomenon, integrated into the political field and carefully calibrated to exert pressure on the elite towards gradual reform. 

By contrast, the 2019 demonstrations spring from a youth-led, bottom-up mobilization that rejects politicization and seeks a more radical form of change. Chatham House surveys in a forthcoming paper reveal that the protesters are younger that those who protested in 2015-16. Fewer have permanent employment. Instead of demanding better services or jobs, they are focusing wholesale transformation of the post-2003 political system.

A Sadrist official told the authors that their movement initially joined the protests in October 2019 expecting a similar reform-orientation to the protests which Sadr had previously led. However, according to him, the protesters failed to come forward with reasonable demands or alternative names for prime minister. He believed the protests would fade, and many would regret the ‘wasted time and blood’. 

Sadr’s relations with Iran

A final long-term factor at play is Sadr’s receding autonomy from Iran. Ever since his movement’s electoral victory in May 2018, Sadr came under enormous pressure to reconcile with the political wing of the Iranian-allied parastatal armed groups in the formation of a new government acceptable to Iran.

Over the last year, Sadr has moved even closer to Iran, spending more time in Qom. Iran has offered Sadr security from his paramilitary rivals (such as Asa’ib ahl al-Haq), convincing Sadr that he is safer in Iran than Iraq. Moreover, Sadr is undertaking religious training in Qom, and may see this as a chance to enhance his standing in the Shia religious field as many look towards a future beyond the elderly Najaf-based marja Ali al-Sistani.

By keeping Sadr in Qom, Iran appears to be trying to isolate him from what they regard as negative influences. As tensions between the Sadrists and other protest groups intensified, efforts were made by some protest leaders and allied political groups to reach Sadr in Qom and try to persuade him to change course or restrain the worst abuses of his forces. However, this delegation was unable to make contact with Sadr. Those involved told the authors they have resorted to communicating with local Sadrist leaders in Najaf, Babil, Basra and Baghdad. 

Crossing a line

This is a transformative moment for the Sadrists. Sadr is now defying the popular sentiments driving protests across central and southern Iraq. The sense of betrayal among former allies and friends of the Sadrists is palpable. One senior activist involved in cooperation with the Sadrists wrote that, no matter what moves Sadr makes next, the cleric has ‘terminated all partnership with the protesters,’ and ‘shattered the framework for cooperation’. A line has thus been crossed that Sadr cannot reverse; he will not be able to recover what he has now lost. 

Iran, also, does not see Sadr as a dependable ally, and will look to isolate and side-line the cleric when the opportunity arises. Thus, in seeking to exploit a crisis for short-term gain, Sadr may well have sealed his fate – in the long term – as a declining force in Iraqi politics.

The view from the Gulf

Neil Quilliam

There has been no coordinated response among states of the GCC, but the messages have been universal, and surprisingly each one has welcomed US efforts to restart peace talks and praised this particular US administration for doing so. But in each case, the same set of issues and concerns has been highlighted, namely the status of Jerusalem, the situation of refugees and ultimately a simple absence of a revival contiguous Palestinian state.

While much has been made of younger Gulf generation’s apparent disconnect from the emotive issues around Palestinian statehood, the state of Jerusalem and the larger refugee issue, older leaders in the Gulf continue to pay them heed. And despite a desire to coordinate with Israel on matters of security, intelligence sharing and tech, they will not advance the relationship under the terms of the so-called ‘deal of the century’.

Put simply, the deal forces Palestinians to concede ground on all matters of importance. And should the Arab Gulf states sign up to it, they will be judged harshly by history for not only selling out Palestine for $50 billion, but also footing the bill. As such, they all feel compelled to hedge and pay salutary lip-service to US efforts but know quietly they will die on the vine and that the Arab Peace Initiative is the only viable framework for advancing talks.

Even younger leaders know that the greater risk will come from signing up to the deal rather than twitter wrath of the US president.

Kuwaiti Parliament Speaker Marzouq Al-Ghanim threw a copy in the bin, emphasizing that it ‘was born dead’ and ‘should be thrown in the dustbin of history’.

While the Saudi official position towards the deal was one of qualified support, the Saudi press reported that King Salman had spoken with Palestinian Authority President Mahmoud Abbas, who has rejected the plan, to ‘stress to him the Kingdom's steadfast position vis-à-vis the Palestinian cause and the rights of the Palestinian people’. The king reportedly added: ‘The Kingdom stands alongside the Palestinian people and supports its choices and what[ever] will actualize its hopes and aspirations.’

Turki Al-Faisal, the former Saudi intelligence chief, described the deal’s idea of a Palestinian state as ‘a brutal conception’ and the deal itself as a ‘modern-day Frankenstein’. ‘For Palestine, it is definitely a step back,’ Al-Faisal said. ‘[The Trump administration has] given up the legitimate history and weight of the United Nations Security Council resolutions and adopted a unilateral path.’

The view from Europe

Reni Zhelyazkova

The initial EU response to President Trump’s ‘Peace to Prosperity’ plan was one of caution. An official statement soon after the announcement declared that the proposal needs to be studied and assessed but only a few days later the EU’s High Representative for Foreign Affairs, Josep Borrell, condemned the plan for being out of line with internationally agreed parameters.

Some member states like Luxembourg have expressed support for the foreign policy chief’s position. Ireland, historically a strong supporter of the Palestinian cause, and Sweden, the only country to recognize the Palestinian state after becoming an EU member, have responded negatively to the US proposal, expressing concern over mentions of Israeli annexation of Palestinian land and stating that it falls short from previous international agreements.

Other EU countries, however, have been much more guarded in their reactions. Responses from Germany and France have so far been lukewarm – on the one hand, welcoming US attempts at re-igniting peace talks between Israelis and Palestinians, and, on the other, warning that any future negotiations and agreements must be carried out in accordance with internationally established parameters and legal frameworks.

A strong voice of support for Trump’s proposal was that of Hungary, whose minister of foreign affairs and trade, Péter Szijjártó, commended White House adviser Jared Kushner on the plan during a meeting in Washington last week. Other EU countries are yet to respond publicly to the proposal but unity among all EU countries is far from certain.

The EU’s official position is that a two-state solution based on pre-1967 borders and in line with previous agreements and UN resolutions is the only viable option for lasting peace between Israelis and Palestinians.

However, Israeli foreign policy under Netanyahu has focused on strengthening bilateral relations with countries in eastern and central Europe. Cooperation with Romania, Bulgaria, Greece, Croatia, Cyprus, Czech Republic, Estonia, Latvia, Lithuania and most recently Slovakia and Hungary has improved in all areas – from security and trade to tourism and cultural exchanges.

Five of these countries, namely, the Czech Republic, Slovakia, Hungary, Romania and Bulgaria recognized the State of Palestine prior to joining the EU, but the rise of populist nationalism, concerns over migration and terrorism, and improving relations with the Trump administration in the US have contributed to an alignment in views between Israel and the right-leaning governments in southern and eastern Europe, as well as those in Italy and Austria.

Improved bilateral relations have translated into political acts of good will towards Israel with a number of EU countries expressing support for Israel in the United Nations and other international forums. Austria, Romania, Hungary and the Czech Republic defied official EU position and attended the US embassy opening in Jerusalem in May 2018.

In this sense, Israel’s strategy in eastern and central Europe can be seen as a deliberate effort to break up consensus within the EU, and, ideally, reverse the bloc’s position towards the Middle East conflict, but also towards Iran. 

At a time when the EU is managing Brexit, a complex internal agenda, including arguments over the EU budget, and with its relationship with the US strained over Iran, trade and other issues, it is unlikely that the bloc will contribute significant efforts to the Middle East Peace Process. It is even more difficult to see the EU coming up with its own proposal and even less likely that all member states will be able to agree on such an initiative given internal divisions. 

Under the EU Neighbourhood Policy, the European Joint Strategy in Support of Palestine for the period 2017-20 has focused on supporting the Palestinian Authority (PA) with institutional reform, economic development and service delivery. Progress, however, has been limited as the success of programming is dependent on Israeli policy towards the West Bank and Gaza. This has hardened under Netanyahu, who enjoys the full support of the current US administration and sees the EU as biased towards the Palestinians. 

Any plan that replaces the 2017-20 joint strategy will most likely be a continuation of the current approach which focuses on conflict management and supporting the already crumbling two-state solution by keeping the PA alive. 

Some room for cautious hope remains, as much depends on the outcome of the Israeli election on 2 March and the US presidential election in November. Changes in leadership could open up space for EU to actively support the reinvigoration of peace talks and regain its relevance as a mediator in the Middle East Peace Process.

After a summer of regional tensions and continued uncertainty regarding the future of the JCPOA, the Chatham House MENA Programme held a closed workshop to examine the impact of the Trump administration’s maximum pressure campaign.

Discussions focused on the domestic developments and challenges inside Iran, prospects for new negotiations with Iran, and the regional issues facing the country. Participants also considered the differences between American and European approaches towards Iran.

Water is a critical issue for Iraq’s future stability and prosperity. Only a few decades ago, the country was one of the most fertile in the region, with two major rivers flowing through it. Today, national and transboundary pollution, mismanagement, and debilitating cycles of conflict have contributed to a situation where only half of current water needs are being met, and where an 80% reduction in the flow of water down the Tigris and Euphrates rivers has led to the loss of millions of acres of formerly productive land and the displacement of rural communities.

Water scarcity can be a driver of violence and conflict. Tribal conflicts over water sources have erupted sporadically in the south and the contamination of municipal water which led to the hospitalization of some 118,000 citizens was a trigger for the large-scale protests in Basra in late 2018. Without concerted action by national and local governments, companies and international agencies, the situation will only worsen as higher temperatures and reduced rainfall drive rural-to-urban migration and increase the risk of drought, food insecurity and water-related diseases.

At this roundtable, part of the Chatham House Iraq Initiative, experts will discuss the domestic, regional and international factors that continue to exacerbate the water crisis in Iraq, and propose solutions, including technical innovation, public sector capacity-building and greater international cooperation, that might contribute to effective state-building, build resilience to the effects of climate change and reduce the risk of further conflict.

To understand Lebanon’s financial collapse, look to its politics.

The country has been deeply damaged by an increasingly dysfunctional political system. A series of compromises have alienated it from its main markets in the Gulf and strangled its economy; anyone that has glanced at fluctuations in Lebanese bank deposits over the last 10 years can see the correlation.

Imagine if Boris Johnson or Donald Trump were obliged to form joint governments with Jeremy Corbyn or Bernie Sanders. The result would be paralysis and lack of accountability as each party pulls the country in opposite directions and blames the other for the state of limbo. This has been the state of affairs in Lebanon since the Doha agreement of 2008. 

That agreement followed an 18-month siege that paralyzed Beirut and an attack on the city by Hezbollah’s ‘black shirts’. The Doha formula imposed governments of national unity between Prime Minister Saad Hariri’s pro-Saudi camp and Hezbollah’s pro-Iran camp and their respective internal allies.

The pattern was set: each period of subsequent paralysis was followed by further compromise as the tug of war pulled the country away from its principal economic partners, the Arab Gulf states, with the regional balance of power tilting towards Hezbollah. 

It was not supposed to be like this. The Baabda Declaration in June 2012, reached after a process of national dialogue, was meant to secure Lebanon’s neutrality in regional conflicts, with both sides promising to hold back on external alliances and coexist despite difference over major regional issues like the war in Syria, the standoff between the US and Iran or relations with Israel or the Gulf states.

This has worn away. The Baabda declaration itself became a sham when Hezbollah inserted itself into the war in Syria in support of the Assad regime and overtly got involved in Iraq and Yemen as an Iranian proxy. This was followed by Saudi opposition to concessions by Hariri that led to the election of General Michel Aoun, an ally of Hezbollah, as president in October 2016; again, after a political paralysis that lasted 29 months with no active government and no head of state.  

The Saudis were also furious when President Aoun’s son-in-law, Foreign Minister Gebran Bassil, abstained from condemning the burning of the Saudi embassy in Tehran at an Arab League meeting in Cairo in January 2016, citing the need to preserve national unity.

Fearing that he was simply providing Hezbollah with protection in the guise of compromise, the Saudis pressured Hariri to resign in November 2017 during a trip to Riyadh, but he later challenged that by retracting on his resignation when back in Beirut. Lebanon was caught between two sides, and as the regional conflict intensified from tension to open confrontation, neutrality was no longer an option.

Gulf connections

An estimated 350,000 Lebanese expats live and work in Saudi Arabia, the UAE, Qatar and Kuwait. These countries are also the main clients for Lebanese contractors, consultants and advertising companies, some of which have offices there. The domestic tourism industry relies heavily on Arab Gulf visitors and they are a principal source of foreign investments especially in the real estate sector.

Lebanon also enjoyed a certain degree of political and economic protection from the US and the Gulf, and Hezbollah benefited indirectly from that protection, as it also shielded it to a certain degree from sanctions.

The deterioration of relations meant that the country was cut off by its Gulf partners. This was manifested in travel bans for Gulf Cooperation Council (GCC) nationals to Lebanon and a decrease in investments and bank deposits, as well as a decrease in remittances from Lebanese expats, partly because of economic crisis in the Gulf countries themselves.

Saudi Arabia withdrew $4 billion of aid to the Lebanese army and internal security forces, and no aid or deposits were forthcoming as the economic and financial situation deteriorated. 

The costs to the Lebanese economy include the opportunity cost created by the annual threat of war with Israel, after which trips are cancelled and projects postponed. Hezbollah also controls a section of Beirut port where it pays no duty or taxes. Add to that the economic fallout from the war in Syria, such as the impact on exports, the inflow of refugees and the cost of Hezbollah’s involvement.

The burden of these political factors is difficult to estimate but it constitutes the ransom that the Lebanese economy bears as a cost of the compromise. This is not to absolve Lebanese politicians from corruption or bankers of mismanagement but to add that political factors cannot be ignored.

The cumulative cost and economic impact of being cut off from its main economic partner eventually bankrupted the country. The fiscal and financial aspects, with Lebanon’s inability to service its debt, are but a reflection of these political factors. In the long run, the key to avoiding complete collapse is to restore relations with the GCC and free Lebanon from that very costly grip.

Summary

• China’s presence in the Maghreb has increased in recent years, raising concerns among Western powers. China has focused on bilateral relations with these countries while also working within the Forum on China–Africa Cooperation (FOCAC) and the China–Arab States Cooperation Forum (CASCF). However, this engagement has limited strategic value compared to relations China has with Saudi Arabia or the United Arab Emirates.
• Since the launch of the Belt and Road Initiative (BRI) in 2013, China has shown greater interest in the Maghreb as an entry point to European and African markets. China has pursued commercial relations over political influence in the region. Morocco and Tunisia are still dependent on France, their former colonial power, and the European Union, which exert great political, economic, security and cultural influence over the two countries.
• The Maghreb countries’ economic relations with China have grown exponentially, with Algeria forming the closest relationship. However, Morocco and Tunisia are keen to attract China’s investment and involvement in major construction and infrastructure projects to boost industrial and economic development. While China’s investments in Morocco and Tunisia remain at a low level, trade relations with both countries have grown steadily. Politically, China’s policy of noninterference in domestic affairs appeals to Maghreb states, which resent Western interference.
• China’s influence in the Maghreb remains minimal. Its soft power push has struggled to promote advantages of strong relations with China beyond economics. Furthermore, Morocco and Tunisia’s populations have generally scant knowledge about China’s politics and culture. China has tried to address this lack of familiarity through the establishment of Confucius Institutes and other cultural activities. However, language and cultural barriers still impede the development of close relations, compared to those China has with other countries in Africa.