Lockdowns in several countries in the region are beginning to ease but there have been setbacks with new clusters emerging and some economies likely to recover more slowly than expected. Jordan is facing a major setback after at least fifty new cases have been discovered in the last several days, just as the country was easing its lockdown for the Eid Al-Fitr holiday, and Lebanon has imposed a four days complete lockdown after new cases were discovered, leading to panic shopping in Beirut and other main cities.

This situation is increasingly challenging for leaders in the Middle East as the main economies in the region had their biggest downturn in almost half a century, and the price of oil has been hitting new lows. The economic downturn has been exacerbated by reliance on income from dropping oil prices in countries such as Iraq, the importance of tourism in locations like Palestine, Jordan and Lebanon and the continued closure of all international travel means.  The pandemic will continue to have major impacts on the region’s economy as the liquidity crisis impacts individuals’ immediate ability to access cash and formal and informal credit, and potentially undermines confidence in financial service providers over the long run. As an example, Jordanian authorities have announced this week that the country’s economy is losing 100 millions JOD per day; without appropriate economic measures, it will take years for the Kingdom the recover from such crisis.

The Covid-19 outbreak is also increasingly affecting the security situation in the region. A Joint Intelligence Bulletin issued by the U.S. Department of Homeland Security, National Counterterrorism Center and the FBI, warned that militant groups have advocated exploiting the COVID-19 outbreak to incite violence and bolster anti-government narratives; a number of regional security agencies have made similar observations in recent days. It is highly probable that domestic and transnational militant groups in the Middle East will continue to capitalize on the disorder created by the pandemic to expand their activities. The threat will be highest in environments where such groups already retain a presence, such as parts of federal Iraq and Syria. The socioeconomic fallouts of COVID-19 also create further conditions for radicalization to violence among impoverished sympathizers of militant groups, the scale and frequency of any future attacks will depend on the local authorities’ capacity to counter the threat.

A Security Crisis

Security across the region tends to deteriorate mainly due to the resumption of protest movements, new forms of protests developing because of the economic situation and an increased use of force by national forces to enforce Covid related regulations.

In southern Yemen, both ROYG and STC introduced measures to stop all movement in Aden for two weeks, apart from goods and humanitarian aid, but both are failing to enforce these measures as people continue to ignore all advice on travel. Throughout the reporting period, authorities in the north reportedly forced more Qat markets into open areas in the outskirts of the cities, closed a number of local street markets, wedding halls, saunas, internet and Shisha cafes and swimming pools; they’ve banned hawkers and street vendors from working, and released a number of prisoners.

In Israel/Palestine, ISF continues to use force to stop demonstrations and enforce business closures. It is still impossible to enter Gaza with an institutional quarantine of 14 to 21 days. NGO staff with West Bank IDs are still not allowed to reach offices in the West Bank and some parts of the area are still under quarantine with no aid workers allowed to enter.

In Iraq, the vast majority of humanitarian organizations continue to deliver vital services through engagement at the governorate level to obtain access letters. However, the process remains inconsistent for all NGOs and the federal access letter process has recommenced, as governorate exemptions are no longer allowed.

After a slowdown of protests dating from October 2019, we are seeing renewed protests in different areas around Lebanon, particularly in Tripoli, Beirut, the South, and Bekaa, but these are more targeted around economic desperation and fears for food security. An increase in attacks on banks has also been observed in the last weeks with groups setting fire to the entrance of certain branches at night or throwing Molotov cocktails at the banks. This is linked to the continued banking restrictions and the frustration with the devaluation of the currency. Additionally, there are complications with the exchange shops as the Central Bank has capped the potential maximum for exchange at a rate of 3,200LL per dollar at the exchange shops. This has been met with a parallel black market with rates as high as 3,900LL- 4,400LL and security forces have arrested exchange shops’ owners not abiding to the agreed upon exchange rate resulting in a declared strike by unions.

The UN call for ceasefire had also very limited effect on conflict activities and intensity in the Middle East. In Yemen, hostilities between ROYG and the Southern Transitional Council (STC) intensified, as the Riyadh Agreement appeared to be breaking apart. STC forces attempted to take over Socotra’s capital Hadibu as clashes broke out on the island for the first time in hundreds of years. Hostilities in Abyan governorate in the south also increased, having become sporadic and limited over the past 6 months as the players bickered about Riyadh Agreement. However, during the reporting period heavy clashes took place in the governorate as both parties also increased the war rhetoric.

In Iraq, although the redeployment of ISF to support COVID-19 mitigation measures, as well as coalition force re-locations and draw downs, will help IS sustain its insurgency, it will also continue to capitalize on the security gaps between ISF, PMUs and Peshmerga forces on the ground. Both the number and modus operandi of recent incidents continues to be of concern as we see the recommencement of arson attacks on crops as the summer approaches as well as on infrastructure such as power lines and the abduction of civilians. There are growing commentary that a number of Sunni-dominated governorates are afraid that the redeployment of Shia factions in their areas as part of the security forces’ campaign to combat Daesh will lead to sectarian unrest.

The country continues to experience widespread political turbulence, even as its security forces have come under assault from Islamic State (IS) attacks. In Kirkuk, Islamic State fighters attacked a building housing Iraq’s intelligence directorate. Besides Kirkuk, attacks have also skyrocketed in Diyala and Salahuddin. The coronavirus has provided militants with more freedom of maneuver and ability to exploit operational space, with recent attacks targeting military checkpoints run by militias affiliated with the Iraqi security forces. Coupled with a drawdown of U.S. troops and the repositioning of Iraqi security forces to urban redoubts, vulnerabilities have emerged, allowing IS fighters to seize the opportunity to fill the vacuum. There are serious concerns that with additional momentum, IS fighters will seek to encroach upon cities and urban areas, where spectacular attacks could result in large-scale casualties. IS appears to be pushing closer to Baghdad, Iraq’s capital. 

The Islamic State has also grown far more active in Syria since late 2019, launching sporadic attacks east of the Euphrates River and expanding its presence throughout parts of the Central Syrian desert. IS militants have also been contesting territory controlled by the Syrian Democratic Forces (SDF) and a number of recent prison breaks in northeastern Syria have led the Syrian Kurds to appeal to U.S. forces for assistance. The Islamic State continues to earn money through extortion. With access to funds and a fighting force in the thousands, IS is well-positioned to wage a low-level insurgency across Iraq and Syria taking advantage of the disorder created by the Covid-19 crisis. 

Economies going down

The Iraq COVID-19 Food Security Monitor reports that the Government has announced ‘an emergency agriculture plan’, in line with strategic prioritization as a key economic sector for expansion to decrease near universal dependence on oil. Iraq’s April oil revenues were roughly $1.4 billion USD, less than half those of March (approximately $3 billion USD). But these measures will be insufficient in a country where a large part of the population cannot meet its basic needs anymore.

In Lebanon, the economic crisis and devalued currency are affecting people’s ability to buy food. The prices of some goods have gone up three-four times the price they were sold at a couple of months ago. Additionally, some areas are witnessing shortage of some products as the purchase power of stores in more rural areas has decreased. The currency crisis and restrictions on US dollars have limited imports and led to sharp price increases. Devaluation of Lebanese currency have led to sharp price increases for existing imports and locally produced goods – sometimes double or triple the price. Transportation is mentioned as less a problem, although fuel availability and price increases may change in the future. Shops relying on domestic producers have noted an increase in demand, which they can currently meet, but say if demand continues to increase, they will not be able to meet demand.

In a similar vein, the continuing devaluation of the Syrian Pound accompanied by a price increase have further reduced people’s purchasing power causing a near-halt in markets. This has also affected dozens of factories and workshops forcing companies undergo budget cuts firing thousands of workers. Prices of food and imported items have continued to increase and some have also gone missing from markets primarily due to traders withholding their sale due the fluctuations in the Syrian Pound. The price of vegetables significantly increased forcing the Government of Syria to intervene in an attempt to curb the increase through the opening of public markets under Syria Trading Establishment supervision allowing farmers to sell their produce in the markets directly to consumers. The Government of Syria also increased the fine for price manipulation from 25,000 SYP to 300,000 SYP.

In Yemen, fears continue that the Covid-19 outbreak will seriously affect supply chains and market price but there has been no major change from the previous reporting period. Increase in internal border closures will likely have a heavy impact as the spread of corona speeds up.

The Covid-19 is an unprecedented health crisis which repercussions will be felt across the globe most probably for several years, in Middle East this is adding a layer of instability by pushing millions into poverty and acting as multiplier for conflict. The coming crisis will be one of governance if leaders in the region are not taking quick actions for their populations.

picture: © Carl Waldmeier

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