‘Blue Gold’ Will Be Turkey’s Key To The ‘Dry Crescent’

Next year will mark a full century since the Ottoman Empire lost control of the areas now known as Syria and Iraq. Now Turkey is pursuing an increasingly nationalistic and assertive foreign policy that’s being called ‘Neo-Ottomanism’. Ironically, water is the geopolitical asset that gives Turkey influence over the area historically referred to as the Fertile Crescent.

The Tigris and Euphrates rise in the Anti-Taurus mountains of Eastern Turkey, giving Turkey effective control of the water resources of Syria and Iraq. In an age of growing population and climate change, water is truly becoming ‘blue gold’.

Contentious dam construction

Turkish dam construction has long been contentious.  Since 1975, Turkish dams have cut the volume of water reaching Iraq by 80% and Syria by 40%. Conflict has almost spilled over on many occasions. In 1990, conflict brewed when both Syria and Iraq believed that Turkey had deliberately cut off their water supplies as both noted a simultaneous, serious decline in water flow. The situation was only diverted by Iraq’s invasion of Kuwait. NATO has a conflict scenario in which Iraq and Syria simultaneously attack Turkey, while the UN ‘Uppsala Model’ includes a scenario in which Iraq and Turkey are brought to the brink of war over water.

Political instability, foreign interference and the Kurdish independence movement in Syria and Iraq present challenges and opportunities which are likely to drive Turkey to weaponize water to extend its political influence. In the summer of 2014, Erdoğan ordered the water in the Euphrates to be held back, reducing water levels in Lake Assad, which supplied IS-held Raqqa. The disappearance of credible opposition in Iraq and Syria with the appearance of IS has given Erdogan greater freedom to extend control of water through the South-Eastern Anatolia dam project (GAP).  While GAP’s main purpose is hydroelectric power and economic growth, Turkey is aware of its geopolitical value. TheIlisu hydro-dam, the latest of the 22 planned dams in GAP, will straddle the Tigris just 30 miles north of the Syrian border. The water from these rivers is not just vital for Iraq and Syria’s food and water, it is also important for their economies. Prior to the rise of ISIS, Iraq’s oil industry required 1.8 billion cubic metres of water to function. Once GAP is completed, it is estimated that half the water from the Tigris and Euphrates may never leave Turkey.

Weaponising water

Turkey’s control of water resources can be instrumentalised to thwart or hinder Kurdish independence.  Iraq Kurdistan relies on 6 major rivers for over 75% of its water, three of which originate in Turkey, and the other two which flow from Iran; also hostile to a Kurdish state.  If Turkey were to limit water supplies to Iraqi Kurdistan, it would hamstring the Kurdish oil industry, central to Kurdish politico-economic autonomy.  It would also generate food and water shortages.  The water dynamics in the region provide a new perspective on the hardline attitude Turkey has taken towards domestic Kurds.  Eastern Turkey holds many of Turkey’s 15 million Kurds, but controlling the region’s watershed is crucial to maintain Turkish territorial integrity and generate influence in the region.

In the future, Turkey’s control of water will become an increasingly potent lever.  Population growth, climate change, and poor management are making water a scarce resource.  According to the UN, by 2050, Iraq’s, Syria’s, and Turkey’s populations are expected to grow by 130%, 89%, and 22% respectively.  A conservative estimate is that over the coming years climate change will reduce rainfall by 20% and massively increase evaporation, halving the amount of water available per person in the Middle East.  Of course, the effects of climate change will be greater in some places; predicted weather patterns could result in the desertification of over half of Syria.  Unsustainable water management, particularly digging illegal wells in Syria, have also decreased groundwater resources in the region, adding unnecessary strain.

A need for sustainable management

The growing centrality of water and the political fragility of Iraq and Syria have given Turkey the agency to expand its influence in the region.  It is certainly exploiting this opportunity. Yet, this combination of factors also means Turkey’s influence is likely to sustain if peace returns. This could generate political friction and spark further economic and political instability, something the region certainly does not need. A lasting political resolution to the instability in Iraq and Syria should incorporate sustainable management of the region’s water economy.

 

Ben Abbs is an Analyst at Global Risk Insights. As originally appears at: https://globalriskinsights.com/2017/12/turkey-water-influence/

 

This column does not necessarily reflect the opinion of the editorial board or Frontera and its owners.

Saudi Arabia’s Escalating Foreign Policy: The Qatar Crisis Is Just The Beginning

Saudi Arabia is losing the shadow war against Iran in the Middle East.  Despite the centrality of foreign policy success to mitigate Saudi’s domestic problems, it is losing in Syria, Lebanon, and Yemen. The Qatar crisis was a reaction to these failures, but will likely drive Saudi to greater extremes.

Since the oil price fell in 2014, Saudi Arabia has been grappling with systematic political and economic problems whilst a competition with Iran for regional hegemony has escalated.  Domestic problems and a coming succession to the kingdom’s throne put an added onus on foreign policy success, yet Saudi’s foreign policy is floundering.  The Qatar diplomatic crisis is a bold move that indicates Saudi’s failures are driving a stronger, riskier foreign policy.  The almost certain failure of the diplomatic blockade is likely to drive Saudi to greater extremes, with a corresponding destabilising effect in the Middle East.

Lebanon is Lost

The election of Michael Aoun as president in November 2016, after a 29-month political stalemate, is seen as a victory for Iran in the Sunni-Shia power-struggle.  Aoun is the leader of the largest Lebanese Christian political party and a staunch ally of Iranian-backed Lebanese Shia movement Hezbollah.  The election of Aoun as president over Saad Haari, leader of Lebanon’s main Sunni bloc, indicates Saudi’s waning influence in Lebanon as its resource are stretched thin in regional competition.  Riyadh had informed its backers in Lebanon, via second-tier officials, that it was of secondary concern and that Saudi would stop sending French military equipment to the army.

Setbacks in Syria

Saudi is also losing influence in Syria.  With the fall of Aleppo and Trump’s U-turn on the need for Bashar al-Assad to leave, the position of the Sunni groups that Saudi wishes to succeed has been weakened.  The support Assad has received from Iran, Russia, and Hezbollah has proved decisive in the battlefield as the US prioritises defeating IS over a regime change.  In February 2017, Saudi’s Foreign Minister stated that Saudi is “ready to send ground troops to Syria” to help the rebels retain ground, which would mark a severe escalation in the war.

Yemen is Saudi’s ‘Vietnam’

Yemen’s geographic and political terrain have proven fatal for Saudi’s intervention leaving it in a quagmire.  It expected a quick victory but it has achieved none of its objectives thus far.  The Houthis, a Zaidi Shia organization, are still at large, and President Abd Raboo Mansur Hadi is still in exile with his government in Saudi Arabia.  Saudi’s image has been damaged by the Yemeni conflict, Iran and its allies have made sure to proclaim its short comings through the Middle East.  The war has also burdened Saudi’s economy; as of December 2016, it was costing an estimated $675 million a month, which forced Saudi to sell of $1.2 billion of its $9.2 billion holdings in European equities to fund the campaign.

Qatar won’t Quit

In simplistic terms, the Qatar crisis boils down to Saudi’s grip on the gulf and Saudi-Iranian regional competition.  The formation of this crisis over the last 22 years also explains why Saudi is unlikely to achieve success.  Qatar used to be in the Saudi fold, a “kind of Saudi vassal state” in the opinion of Jim Krane, energy research fellow at Rice’s University Barker Institute in Houston, Texas.  The year 1995 was a turning point.  Sheikh Tamin, the father of the current emir overthrew his father, who was pro-Saudi, and Qatar made its first shipment of Liquid Natural Gas (LNG) from the offshore North Field, which is the largest gas reservoir in the world.  Qatar was able to use the agency created by its gas wealth to assert its unrestricted autonomy.  This has allowed it to support whom it chooses, notably the Muslim brotherhood on occasions, and form ties with powers, such as Iran, the U.S., and Russia.  Qatar now produces 30% of global LNG and has a per capita income of $130,000.

Qatar’s reliance on gas instead of oil has left it free from the Saudi domination it would have been exposed to as an oil-reliant member of OPEC.  It has also been necessary that Qatar maintain a working relationship with Iran to protect its economic source of autonomy.  Iran could hinder Qatar’s access to the North Field.  Qatar self-imposed a two-year freeze in gas exploration and output in 2005, supposedly to study how the gas field was responding to exploitation.  Given the suspension was lifted 10 years late, in April 2017, when Iran caught up with Qatar’s gas production, it was clear sign of goodwill to Iran.  Further, increased exploitation will likely require collaboration with Iran.  Concerned about their loss of control in the Middle East, irritated by the growing Qatari-Iranian working relationship and Qatar’s autonomy, and emboldened by Trump’s visit and Qatar’s public rejection of Trump’s call to isolate Iran, Saudi took the opportunity to re-assert control over Qatar after previous failed attempts between 2002 and 2008.  This crisis will very likely become another failure to add to the list of Saudi foreign policy escapades.  Gas production amounts to 60% of Qatari export revenue, Qatar’s relationship with Iran is economically fundamental and ensures its sovereignty.  Unless Saudi can suggest a way to secure Qatar’s gas without Iran, Qatar won’t back down.

This setback is likely to drive Saudi’s foreign policy to greater extremes.  This could manifest in a greater presence in Syria, as Saudi’s Foreign Minister voiced in February, or bolder actions against Iran, Hezbollah, or Qatar.  Whatever it may be, a continuation of the escalation of Saudi’s Foreign Policy will be regionally and domestically destabilising.

 

Ben Abbs is an Analyst at Global Risk Insights. As originally appears at: http://globalriskinsights.com/2017/10/saudi-arabias-escalating-foreign-policy-qatar-crisis-just-beginning/

 

This column does not necessarily reflect the opinion of the editorial board or Frontera and its owners.

Four Hidden Flaws That Could Push Asian Tigers Towards Instability

Amidst recurring bullish predictions and rhetoric of Asia’s rise we should be careful of falling into complacency. Despite years of high economic growth, Asia faces many serious challenges.  Regional political relations, economic health, water-security and demographic trajectories will push many key Asian nations towards instability.

Western leaders have watched, with envy and concern, the rapid growth rates of countries in Southern and Eastern Asia.  Many commentators agree that the Asian Century is upon us, and merely debate whether it will be Chinese or Indian.  The balance of power is certainly adjusting.  Last December, China seized a US monitoring drone  in the international waters of the South China Sea, with impunity; an act unimaginable two decades ago.  However, for all their bluster, the continued rise of the Asian Tigers is far from assured. A great many problems remain which could undermine their growth.

On July 24th, Vietnam pulled the plug on a $300 million gas-drilling expedition in a disputed area of the South China Sea after China threatened to attack Vietnamese bases in the Spratly Islands.  Setting aside these familiar tensions in the South China Sea, Asia has many other serious territorial disputes affecting most Asian nations.  Japan has disputes with all of its neighbours, and China is engaged in 13 territorial disputes with 8 neighbours.  These disputes impact business and investment and can spark conflict-generating economic and political instability.  Concerningly, despite improving multilateral cooperation over the last two decades, there is still no effective regional political community and there are few political mechanisms to manage crisis.  These disputes also become scapegoats for a host of domestic problems – such as slowing economies, water-security, and demographic problems – which constitute de-stabilising threats in their own right.

Faltering economic health

Asia’s economic health should be watched as growth slows, particularly in China.  Slowing growth has led to unsustainable debt increases in many countries, such as Singapore and Taiwan.  Japan’s aging population and weak productivity have generated a 234.7% GDP-to-debt ratio; the highest in the world.  Beijing’s repeated use of cheap credit to stimulate growth caused China’s gross debt to surpass 304% of GDP in May 2017; links between state-owned companies and banks heighten the economic risk inherent in this debt.  A default in the heavily indebted corporate sector could send shockwaves through state-owned banks and trigger a systematic crisis.  Further, China’s efforts to transition from anexport-led economy to one driven by domestic spending, has had limited success.  This is clearly reflected in economic statistics – consumer spending only makes up 37% of China’s GDP, far below the United States (68.1%), Japan (58.6%), or even Russia (51.9%).

Drought in India.

Populous and thirsty

Asian water-security is being pressured by climate change, water management, and economic and population growth.  Water shortages disrupt economic production and generate political unrest.  Given their economic and demographic significance, scarcity in India and China are particularly concerning.  Between 2003 and 2009, northern India lost water at the fastest rate in the world according to NASA.  The livelihood of 600 million Indians depends on agriculture and almost 2/3 of India’s cultivated land relies on rainfall rather than irrigation. India is also uneconomic with its water, using 28% more freshwater than China despite a smaller population and economy.  India’s water stress explains, in part, the tension between India and Pakistan in Kashmir in which major rivers – namely the Punjab – begin.

There is also a growing water-security crisis in China.  The glaciers that feed the Yangzi and Yellow River are melting, even as experts predict that Chinese water demand will outstrip supply by 2030.  As of 2014, North China holds two thirds of Chinese agriculture but only one fifth of its water, and 45% of GDP is in regions with a similar water resource per capita as the Middle East.  China’s water issues will inevitably drive it to strengthen control over its watershed.  The major rivers that feed the Asian sub-continent and South East Asia start in the Tibetan Himalayan glaciers; dashing any hopes of an independent Tibet.  Chinese exploitation of Tibetan water will create conflict with downstream nations; in the Indian subcontinent and Southeast Asia which rely on these rivers.

Depressing demographics

After World War II,  commentators thought the Japanese economy would soon dominate the world as its equity market soared and Japanese businessmen purchased US trophy properties such as Pebble Beach.  Yet, in the 1990s, Japan’s economy stagnated, due in part to the burden posed by its aging population.  Most developed Asian countries, such as Japan, South Korea, Taiwan, and Singapore, are facing aging populations which will increase dependency ratios and dampen economic performance.

In particular, China will likely become old before it becomes rich.  China’s One Child Policy enabled a ‘demographic dividend’ by decreasing the amount of dependents average earners needed to support. This has underpinned China’s economic rise, and accounted for up to one quarter of China’s per capita GDP growth since the mid-1970s as the working share of the population rose from 55% to 73%. But this rise has now peaked and China’s developing economy now faces a glut of aging workers without the affluence to support strong social care.  This will cause economic and social stress as a smaller working share of the population will yield a lower per capita living standard, and savings and investments will fall.  Huge economic gains have helped the Chinese Communist Party to contain dissent, yet China already suffers 200,000 protests a year of varying sizes. China is perhaps less stable than many realise.

Given Asia’s importance, the diversity of risks that face it must be understood.  Asia could dominate the 21st century for the wrong reasons – as a source of political turmoil and economic instability.

 

Ben Abbs is an Analyst at Global Risk Insights. As originally appears at: http://globalriskinsights.com/2017/09/flaws-within-asias-star-countries/

 

This column does not necessarily reflect the opinion of the editorial board or Frontera and its owners.