Middle East in turmoil even before pandemic hit

Coronavirus Middle East

July 7, 2020

Middle East in turmoil even before pandemic hit

The pandemic struck a Middle East that was already laboring under overlapping political, economic, security, and humanitarian crises.

There are deep concerns about how long stability can be maintained in the face of these multiple crises, considering the pandemic’s turbulent effects on a region characterized by turbulence.

Post-COVID-19

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US global leadership at risk

This article is part of a series examining the ways that US global leadership could be threatened in a post-COVID-19 world. Click below to read the main entry in the series.

Governments across the region have put social distancing and other measures into place, policies made urgent given that the virus arrived in the region early, via Iran, and with deadly impact.

Yet perhaps more than anywhere else in the world, the region’s governments are facing intense and often contradictory pressures resulting from the need to protect public health and promote economic recovery while ensuring political stability.

One significant dilemma is that the region’s public health systems could be swamped if social distancing is lifted and the pandemic explodes. Iran, the region’s early epicenter, began reopening in April only to see its cases surge in May, threatening not only to eliminate any fragile economic recovery but also reignite the pandemic.¹ Similar outbreaks occurred in Gulf Cooperation Council (GCC) states after governments lifted restrictions over Ramadan, causing them to reinstate lockdowns and other measures.²

In those countries hit hardest by conflict (Iraq, Syria, Yemen), weak or nonexistent public health systems plus ongoing violence and mass displacement means that humanitarian worst-case scenarios are possible. (On-the-ground reporting from Yemen indicates that a pandemic-driven crisis already is underway; in contrast, evidence from the region’s many Syrian refugee camps mercifully suggests that the camps thus far are spared the infection, if not the social and economic fallout.)³

The pandemic’s long-range impacts will add to the region’s list of structural challenges. That list starts with economic reform. For the major oil- and gas-producing states (the GCC member states, Iran, Iraq, Libya, Algeria), the pandemic’s impact is revealing, once again, the dangers of being overly reliant on hydrocarbons for economic growth.⁴

Driven by a collapse in global demand and a glut in supply, during the spring of 2020, global oil prices slid to rock-bottom levels. Although prices have stabilized, sustained lower oil prices are likely given the odds of an ongoing global recession.

Will COVID-19 slow the global shift to renewable energy?

In the short-term, the pandemic almost certainly reduces greenhouse gas emissions due to lower energy demand.

But that shift is a two-edged sword. Innovation and adoption of green technology accelerates when fossil fuel prices are high and decelerates when they’re low.

Moreover, many of the parts for large-scale green energy programs come entirely or partially from China, other parts of Asia and the United States. These specialized supply chains have few substitutes. As an example, the pandemic has already slowed Chinese production of solar panels, delyaing projects in India and Australia.

One way to mitigate existing low prices would be through increased taxes on fossil fuels, which would help to incentivize continued changeover to renewables.

Moreover, the tourism industry, a major part of the economy of several countries (the United Arab Emirates, Saudi Arabia, Israel, Egypt, Turkey, Jordan, and more), has also taken a substantial hit.⁵ Impacts on employment and government revenues are already severe.

For the region’s governments, the pandemic opens up yet another structural challenge: the legitimacy of their rule. Although governments the world over are facing their constituents’ frustrations amidst the pandemic, nowhere is the legitimacy issue more acute than in the Middle East.

Although temporarily stilled by COVID-19 lockdowns, simmering discontent with social, economic, and political conditions is never far from the surface across much of the region. Multiple governments have instituted measures designed to eliminate public criticism of their pandemic responses.⁶

Over the longer run, it is unclear whether governments will be able to prevent pandemic-driven mass dissent along the lines of the Arab Spring, now nearly a decade in arrears.

How the region’s geopolitical reshuffling will be impacted is equally unclear. The regional powers all face their own internal (domestic) public health, economic, political, and security challenges related to the virus. Of these, both Saudi Arabia and Iran face the oil producers’ dilemma as described above.

Although neither will escape unscathed, Iran arguably is in a worse position owing to the double impact of ongoing US sanctions, which have affected its ability to sell its oil (even at a reduced price) and to repatriate revenues from sales abroad.⁷

For non-regional powers that historically are most active in the region, specifically the United States, Europe, and Russia, the pandemic raises two questions: how will the pandemic force them to reevaluate their interests in the region, and how much are they willing to invest in the region going forward?

It is not a stretch to imagine that many allies fear a hard-hit and divided United States will be even less willing to engage than before.