(November 01-15, 2016)

Iran, West Asia & Middle East

Iran and the Airbus Deal

In what could be considered as a significant breakthrough, on 7 November, Iran concluded a deal with a foreign leasing company for the purchase of 17 commercial jets from Airbus. The deal is part of the orders Iran made for 100 jets from Airbus and Boeing early this year. This also broke the logjam that remained before the efforts to import aircrafts after the sanctions against Iran were lifted following the 2014 nuclear deal with the P 5+1 countries. It was highly speculated that a third party was involved in reaching this deal, and the United Arab Emirates Dubai Aerospace was believed to be the firm that will help finance the purchase. However, the Emirati firm and airbus did not comment on this deal. Meanwhile, this mechanism is likely to be used to “finance a provisional order for 20 turboprops from ATR, which is half-owned by Airbus”. The Iranians, however, remained wary about the outcome of the just-concluded US elections as the new president-elect Donald and a few conservatives in the US Congress severely criticized this deal. This was mainly the reason why the incumbent president, Barack Obama, came out strongly about vetoing any legislation that seeks to block the financial transactions required for the export of passenger aircraft to Iran. That said, reaching this deal represents a big economic prize for the Western companies and also reflects the willingness of Iran to engage more openly with the international community after remaining in isolation during the sanction years.

Syrian Crisis

Despite several attempts by the international players such as the US and Russia, and regional actors, namely Turkey and Iran, there is no end in sight to the ongoing conflict in Syria. The Syrian army, with its offensive tactics, has made further inroads into Aleppo and liberated several neighborhoods, during early and mid-November, from the control of militants. This is noticeable in the southern parts of this city. However, there have been fierce resistances from the rebels and terror organizations which are operating in and around eastern side of Aleppo where civilians are reportedly trapped. Around 15 November, approximately 1,500 civilians stood against the militants but their demonstrations were suppressed by jihadists using violent mechanisms. There are simultaneous strong oppositions to the bombings being conducted by the Syrian government.

On other hand, crackdown on the Islamic State of Iraq and Syria (ISIS) in Raqqa areas has also been intensified with the launch of operation Operation Euphrates Wrath on 6 November. The Syrian Democratic Forces (SDF), which consists of the Syrian Kurdish YPG (People’s Protection Units) and other allied opposition partners, conducting this military with the main objective liberating Raqqa from ISIS’s clutch. The decision for this combined effort was reached on 5 November after a meeting between the US Chairman of the Joint Chiefs of Staff Gen. Joseph Dunford and his Turkish’s counterpart in Turkey. After serious discussions, YPG were allowed to participate in the initial campaign towards isolating ISIS from Raqqa while the final phases, according to a report, “… Sunni Arab fighters drawn from opposition groups, tribes, and other local forces will lead the final effort to seize, hold, and govern the Raqqa city". The ongoing crisis has become messier with the involvement of different international and regional powers with their vested interests. This was the reason why President Bashar al-Assad, in September this year, said, “When you talk about it as part of a global conflict and a regional conflict, when you have many external factors that you don't control, it's going to drag on”. Given the scenario, the crisis is nowhere near to any viable solution.

OPEC and Oil-Demand Forecast

The Organization of the Petroleum Exporting Countries (OPEC) made a forecast for a rise in the global oil demand in the succeeding year and similar prediction through the end of this decade. It also anticipated that cheaper crude oil increase the consumption level despite a slow-down in the economic growth. According to its ‘World Oil Outlook’ that was released on 8 November, “Demand will reach 95.3 million barrels a day in 2017”, which is also an increase by 300,000 barrels per day (bpd), that was forecasted last year. Simultaneously, OPEC also increased its outlook for oil use for three consecutive years—2018, 2019 and 2010—as it sensed the demands touching 98.3 million bpd, or an increase of 900,000 more than previous year’s outlook projection. Further, the organization has estimated the average price for crude at US $ 40 a barrel for 2016, with an annual increase of US $ 5 a barrel to 2020. The OPEC went on to say that demand for oil in the developed countries will slow down after 2017 owing to the increased supply of natural gas, nuclear and renewable energy.

But on the contrary, oil consumption in the developing world continue to soar until 2040. India fits well into the latter scenario where its oil demand will likely increase by 5.4 million bpd by 2021. Likewise, the International Energy Agency (IEA) also increased its estimates for oil production from non-OPEC countries in the following year. In its report released on 10 November, “Brazil is set to increase production by 280,000 barrels a day next year, while Canadian output will rise by 225,000 barrels and Kazakh supply by 160,000”. A sum total of these countries’ production would tantamount to non-OPEC supplying 57.2 million bpd. While the increasing focus on the natural and renewable energy sources may be good for the environment, there are simultaneous geopolitical concerns that loom large. Countries such as Iraq, Libya, Nigeria and Venezuela are likely to face problems, particularly because of the oil-price crisis since last two years. Moreover, Iraq, Nigeria and Libya are currently afflicted by terrorism, internal militancy and political instability.

Africa

South Africa's Zuma Defeats No-Confidence Vote over Graft Allegations

South African President Jacob Zuma survived a no-confidence vote after the anti-graft watchdog called in a report for a judicial inquiry into allegations of influence-peddling in the government. The scandal highlighted has rattled investors in Africa's most industrialised country and raised the risk the stagnating economy's credit ratings will be downgraded. Zuma, 74, had the support of the African National Congress (ANC), which controls about two-thirds of the 400-member assembly. He has already survived a no-confidence motion and an impeachment vote this year, related to other scandals. Zuma's African National Congress (ANC), which controls almost two-thirds of the assembly, voted against the motion and burst into song in support of Zuma.

The main opposition Democratic Alliance (DA), which called the no-confidence motion against Zuma over what it described as his "reckless leadership", asked for a re-count of the vote. Zuma, who was not in the assembly, won with 214 lawmakers voting against the motion, while 126 voted in favour and one abstained, a result that mirrored his victory in March. Zuma denies allegations that he granted undue influence to the Gupta family of business tycoons, who run a business empire from media to mining, or anyone else. The Guptas have also denied any wrongdoing.

UN Envoy Fears Escalation of Ethnic Violence in South Sudan

The UN’s special envoy on preventing genocide, Adama Dieng has said he feared an escalation in the violence in South Sudan following what he said was the extreme polarization of the people along ethnic lines. Hopes of a return to peace in South Sudan are quickly fading away following fears of more violence. There is a concern over strong risk of violence escalating along ethics lines with the potential of genocide. In place of development of a South Sudanese national identity it is seen that there is an extreme polarization among some tribal groups.

Fighting between forces loyal to President Salva Kiir and his former deputy Reik Machar, who is currently in exile, is said to have divided South Sudanese and led to attacks on individuals and communities based on their perceived political affiliation. Stereotyping and name-calling have been accompanied by targeted killings and rapes of members of particular ethnic groups, by violent attacks against individuals of communities on the basis of their perceived political affiliations. The media including, social media, are being used to spread hatred and encourage ethnic polarization.
Despite a peace agreement signed in August 2015, peace is yet to return to South Sudan, the world’s newest country.

'Promise of Peace' as Ivory Coast Enacts New Constitution

A new constitution is signed by President Alassane Ouattara into law on casting it as the way to a peaceful future for Ivory Coast. This has emerged as one of Africa’s rising economic stars after years of violent turmoil. The new constitution's promulgation creates the West African nation's third republic. The promises of this Third Republic are the promises of peace, stability, equality and modernity.

Ivory Coast's previous constitution, drafted under military rule following a 1999 coup, was at the heart of a decade of turmoil that included two civil wars. In its most controversial clause, it said presidential candidates' parents must both be natural-born Ivorians - a swipe at northerners, many of whom, like Ouattara, have family ties that straddle the borders with Burkina Faso and Mali. The new constitution scraps that rule, which was used to disqualify Ouattara from a vote in 2000, and now only one parent must be Ivorian. It creates the post of vice president and a senate. The president says all these new measures will guarantee more political stability.

There are various challenges awaiting the country and the new constitution is brought in to confront all the challenges. Today, the world's top cocoa producer is now on track to be Africa's fastest growing economy this year.

27 African Countries Adopt Marrakesh Declaration

In Africa, 27 countries including Nigeria have confirmed their commitment to placing the Adaptation of African Agriculture (AAA) at the heart of the COP22 negotiations by adopting the AAA Initiative Marrakesh Declaration. COP22 is the 22nd session of the United Nations Framework Convention on Climate Change (UNFCCC) that came into force in 1994. This aims at reducing greenhouse gas concentrations in the atmosphere.

AAA, launched in Morocco, seeks to reduce Africa's agriculture vulnerability to climate change. It aims at promoting and fostering the implementation of concrete projects that will help improve land and the effects of climate change on agriculture and food production.

By this declaration, the AAA coalition is determined to respond to the high expectations pinned on COP22 which will run from November 7 to 18 in Marrakesh - so as to make it the "COP of Action" and the "COP of Africa."

Ethiopia's Tourism Revenue Falls by over $ 7m Due to Protests

Ethiopia’s tourism revenue has taken a massive dip in the wake of anti-government protests that started a year ago. The Horn of Africa country is projected to lose about 400 million dollars from tourism in the current budget year. Income from the tourism sector had fallen by more than $7m over the last quarter alone.

The country had planned to generate 3 billion dollars from tourism this year but the current shortfall had forced the government to revise its targets. The government declared a six-month long state of emergency in October as part of effort to quell the protests. Most of the protests were in the Oromo and Amhara regions. The clampdown by security agencies led to international calls for the government to respect the rights of protesters.
Ethiopia is a preferred tourist destination for people from around the world. It is estimated that in 2015, over 900,000 tourists visited Ethiopia – famous for its rock-hewn churches, highlands and national parks. But tour operators report of increase in cancellation of reservations by tourists after the US, UK and several other countries issued travel advisories, warning citizens against all but essential travel to Ethiopia.

Central Asian Republics (CAR)

SCO: Heads of Government Meet in Bishkek

Shanghai Cooperation Organization (SCO) meeting of the Council of Heads of Government of member states was held in the Kyrgyz capital Bishkek, on November 2-3, 2016. The two-day meeting was hosted by Kyrgyz Prime Minister Sooronbay Jeenbekov, and was attended by Russian Prime Minister Dmitry Medvedev, Chinese Premier Li Keqiang, Kazakh Prime Minister Bakytzhan Sagintayev, Tajik Prime Minister Kokhir Rasulzoda and Uzbek First Deputy Prime Minister Rustam Azimov. It was annual meeting of the Council of Heads of Government, which is the second highest body of the SCO.

Key agenda of the Bishkek Meeting was implementation of pacts reached by the Council of Heads of State at the Tashkent Summit in June 2016. Prime Ministers of the member countries signed a total of 12 agreements and a joint communiqué. Significant agreements included setting up the SCO Development Bank, SCO road development plan, and creating mechanisms for financial support for project activities within SCO frame work. Heads of Government also deliberated on measures to enhance regional security by jointly countering terrorism and drug trafficking. Although initially set up to settle border disputes and to tackle the problems of terrorism, extremism and separatism, SCO has gradually transformed into a formidable economic force. With China’s increasing economic engagements in the region under the One Belt One Road (OBOR) plan, and advancement of Russia-led Eurasian Economic Union (EEU), Eurasia is set to emerge as economic hub. Development of transport infrastructure and lifting the trade barriers is likely to boost multi-lateral trade and economic cooperation between SCO member states. Bishkek Meeting of Heads of Government took vital steps in this direction.

The Indian Minister of State for External Affairs Mr. M. J. Akbar represented India in the Bishkek Meeting. In his address, he reiterated India’s commitment to combat terrorism and stressed on joint efforts by SCO states to curb this menace. India and Pakistan, which have observer status in SCO, are likely to become full members by 2017. The proposed expansion of the organization shall lead to better prospects for regional stability and enhanced economic cooperation.

Uzbekistan: High level Visits amid Internal Transition

Uzbekistan is centrally located in Central Asia. Its long border with Afghanistan, coupled with ethno-cultural spillovers, has made this country vulnerable to spread of extremism and radicalism. However, during the strong reign of President Islam Karimov, Uzbekistan acted as a buffer against terrorism and militancy. Death of Karimov has posed serious challenge for Uzbekistan’s stability in particular and regional security in general.

Uzbekistan is currently passing through vital political transition. Elections for the new President are scheduled to be held on December 4, which interim President Shavkat Mirziyoyev is likely to win. He has served as country’s Prime Minister from 2003, and has worked closely with President Karimov. Experts suggest that Mirziyoyev will more or less continue with the legacy of President Karimov. Amid political transition, Uzbekistan was subject to number of high-level visits this fortnight. On October 29, the Interim President received US Under Secretary of State for Political Affairs Thomas A. Shannon. Both the parties discussed evolution of bilateral relationship, and regional and international issues. Mr. Shannon also visited Samarkand, and paid tribute to late Islam Karimov.

India's Minister of State for External Affairs Mr. M. J. Akbar visited Uzbekistan on November 1, 2016. He paid homage to late President Karimov and laid flowers to his burial site in Samarkand. During visit, Mr. Akbar reiterated the contribution of Karimov in building the new nation, and in developing India-Uzbekistan relationship. Mr. Akbar was received by Uzbek Minister of Foreign Affairs, Mr. Abdulaziz Kamilov.

On November 12, the Chinese Foreign Minister Wang Yi paid official visit to Uzbekistan. In his meeting with the Uzbek Foreign Minister Mr. Kamilov, the two parties discussed bilateral issues including trade, investments, scientific and humanitarian cooperation, and security partnership. Chinese delegation also visited late President Karimov’s grave in Samarkand.

All the high-level visits in the fortnight had an underlying thread. While all the official guests visited Samarkand for paying homage to late President Islam Karimov, they expressed serious concerns about the unfolding security risks in the region. Uzbekistan’s domestic stability is considered by many as essential for wider regional stability. Stable and peaceful Uzbekistan is in interest of all the major powers of the region, who seem to have stood by the nation in its difficult time.

Kazakhstan: Engagements with Big Eastern Powers

Kazakhstan is the largest Central Asian state in terms of geographical area. It has highest GDP in the region and has considerable hydrocarbon reserves, which makes this country an important economic power in Eurasia. Through its multi-vector foreign policy, Kazakhstan has been successful in maintaining healthy relations with number of states. This fortnight was important for Kazakhstan in terms of its external engagements.

Chinese Premier Li Keqiang paid official visit to Astana on November 3, 2016. He held bilateral talks with Kazakh President Nursultan Nazarbayev at his residence. China has recently emerged as important trading partner and leading investor in Kazakhstan. On the other hand, Kazakhstan is significant for China on two fronts; firstly, in advancement of its OBOR policy through expanding road and rail networks in the region; and secondly, for the steady supply of oil. Therefore, this relationship is majorly driven by economic interests.

On November 6-9, President of Kazakhstan Nursultan Nazarbayev paid official visit to Japan, and had bilateral meeting with Japanese Prime Minister Shinzo Abe. During visit, Kazakh President also met Japanese emperor Akihito. Kazakhstan-Japan relationship has evolved significantly in last couple of years. Personal rapport between President Nazarnayev and Prime Minister Abe has played vital role in this direction. The relationship is driven mainly by economic cooperation, trade, investments and nuclear non-proliferation.

Russia Arrests 10 Suspected Terrorists from Central Asia

On November 12, Federal Security Service (FSB) of the Russian Federation arrested 10 suspected terrorists, who were allegedly linked to the Islamic State (IS) and were planning ‘Paris-style’ attacks in Moscow and St. Petersburg. According to the FSB, these terror suspects were from Central Asia, although the agency did not specify name of the country of their origin. FSB has informed that these arrests were made in cooperation with law enforcement agencies in Kyrgyzstan and Tajikistan. This incident underlines the alarming spread of radicalism in Central Asia. Recent reports have suggested that young Central Asians are joining the IS onlarge scale. Ferghana Valley, which is fertile and densely populated piece of land, divided into Kyrgyzstan, Tajikistan and Uzbekistan, has emerged as the epicenter of militant activities in the region. It is believed that the 10 suspected terrorists arrested in Russia hailed from Ferghana valley.

Central Asian states are trying to curb the menace of terrorism in close cooperation with each other, and with big powers like Russia and China. Their actions are supported by multilateral mechanisms like SCO’s Regional Anti-Terrorist Structure (RATS).These efforts have to be accelerated through de-radicalization and counter-terrorism activities.