In 2008, the primary drivers impacting regional security and political and economic stability were instability in Iraq, the expansion of Iranian military capabilities and regional influence, the Arab-Israeli conflict, and the 2008 global financial crisis. In 2009, issues previously at the forefront of regional security will take a back seat to national efforts to survive the global financial crisis. As such, the decline in oil revenues, as well as the election of moderate conservatives, will impede Iranian support for terrorism and restrict nuclear and weapons development in 2009. Similarly, Sunni-Arab states will remain concerned about Iranian weapons development but will focus on national economic challenges.
Unlike in 2008, intra-Shia conflict in Iraq will not be a primary concern. The Iraqi government will regain sovereignty over the majority of its territory and will focus its efforts on economic development and defeating insurgents in northern Iraq, Mosul in particular.
Arab-Israeli Relations
In 2009, Arab-Israeli relations will stagnate. The Likud party, led by Benjamin Netanyahu, will win Israel’s February 10, 2009 general election. Though Netanyahu has expressed a preference for pursuing a policy grounded in economic determinism in the West Bank, he failed to outline his plan to address instability in the Gaza Strip. In the end, though Netanyahu campaigned on a moderate-right platform, ultra-conservatives elected to the Likud ballot in December 9, 2008 primary elections will likely dictate the Likud’s policy toward Hamas in Gaza. As such, members of the new Likud government that opposed Israel’s 2005 unilateral withdrawal from Gaza—likely the majority—will employ tougher measures against Hamas militants in Gaza.
The newly elected Likud government will likely promote the institution of a long-term Israeli security presence in the Gaza Strip. The Israeli government will, nevertheless, fail in its aim to destroy the Hamas leadership network. The large-scale Israeli military operations launched on December 27, 2008 will, however, succeed in winning increased support for Hamas political candidates in the March 2009 Palestinian National Authority (PNA) elections. As a result, in light of the Likud election, Israel’s military campaign in Gaza and the Israeli government’s inability to reign in settler violence in the West Bank, PNA elections will be a close competition with Hamas emerging as the likely victor (Previous Report).
Outside of the Israeli-Palestinian conflict, Arab and Kadima efforts to restart negotiations based on the Saudi Peace Initiative will fail. On December 19, 2008, Likud leader Netanyahu dismissed ongoing Israeli-Syrian peace negotiations saying “concessions made by the Olmert-Livni government to the Syrians do not and will not obligate a government that I shall head.” The Likud traditionally has not supported ‘land-for-peace’ proposals. The Likud is, therefore, unlikely to succeed in reaching an agreement with Syria, which holds the return of the Golan as the primary goal of any Israeli-Syrian peace deal.
On the Iranian front, the global economic crisis and anticipated election of a moderate-conservative president in June 2009 will likely persuade Israel to postpone military action against Iranian nuclear facilities.
In addition, enhanced military operations in the Gaza Strip will likely produce anti-Israeli demonstrations in neighboring Arab countries. As a result, Egypt, Jordan, Syria, Lebanon, and Saudi Arabia will be forced to harden their foreign policies toward Israel in the mid-term.
Post-US Iraq
The passage of the US Status of Forces Agreement (SOFA) in Iraq on November 27, 2008 guaranteed the withdrawal of US troops from Iraqi cities by June 30th, 2009. Under the current SOFA, US forces in Iraq must completely withdraw from Iraqi territory, unless invited to remain in Iraq by the acting Prime Minister, by the end of 2011. To date, Iraq forces have demonstrated a capacity for professionalism and have maintained security in territories transferred under their authority. As such, we anticipate a relatively smooth transfer of authority from US to Iraqi security forces in the few remaining US-patrolled regions of Iraq.
Unlike at the close of 2007, we do not anticipate a large-scale intra-Shia power struggle in the wake of the withdrawal of US forces. Following Moqtada al-Sadr’s August 2007 ceasefire declaration (Previous Report), Prime Minister Nouri al-Maliki and the Supreme Islamic Iraqi Council (SIIC) consolidated their authority in both the political arena and on the ground via their militia, the Badr Brigades. As a result, the Sadr Movement’s influence has significantly diminished. Though it will continue to be a political player in the Iraqi parliament and on provincial councils, the Sadr Movement no longer poses a direct military threat to SIIC leadership (Previous Report).
The primary driver behind instability in Iraq will be Kurdish objections to proposed National Hydrocarbon legislation and demands that a referendum on the status of Kirkuk be held (Previous Report). Cognizant of the volatility that would accompany a Kirkuk referendum, the Iraqi government will seek to further postpone the Kurdish vote. Instead, the government will commit 2009 to the passage of national hydrocarbon legislation and economic development (Previous Report).
Overall, though Iraq is expected to face both economic and political challenges in 2009, the political outlook is relatively positive compared to past years. Al-Qaeda and the Sadr militia are on the decline and the government’s incorporation of Sahwa fighters into the Iraqi Security Forces will foster limited Shia-Sunni reconciliation (Previous Report).
Shia-Sunni Relations
Shia-Sunni tensions will take a back seat to regional economic challenges in 2009. Though in 2008 Iran leveraged surplus oil revenue to enhance its regional influence, the sharp decline in oil prices will restrict Iran’s ability to fund terrorism in Iraq, Lebanon and the Palestinian Territories. Alongside the anticipated election of moderate-conservative technocratic leadership in 2009 Iranian elections, the economic downturn will also curb funding for Iran’s nuclear and missile development programs. As such, though the consolidated power of SIIC in Iraq will undoubtedly provide it a foothold in Iraqi politics, Iran’s regional influence will plateau.
Sunni-Arab states and members of the Gulf Cooperation Council (GCC) will continue to develop enhanced defensive capabilities, such as development of air missile defense systems (Previous Report), to counter Iranian military advancements. However, the global economic crisis and rising regional unemployment will take precedence. National concerns like the lack of liquidity in the banking sector, unemployment and hunger will overshadow regional concerns. The result will not be a decline in Shia-Sunni tension but rather redefining of national and regional priorities.
