Andrea Teti: Middle East – resource scarcity, hydrocarbons and hydropolitics

Interview

Natural resources in the Middle East

To what extent will the region be able to diversify its hydrocarbons-dominated economy in the long-term?

This depends on choices states make, and thus on internal power balances, as well as receipt of external aid. The picture across the region is variable: for example, Dubai’s attempts to diversify have been shaky, but Abu Dhabi and Qatar have been relatively more successful. Iran has made attempts to diversify its economy, and despite the pre-electoral international spat over its alleged attempts to develop military nuclear technologies, the objective of simply diversifying from oil should not be underestimated, particularly in the context of Iran’s growing population and the economic pressures this will increasingly generate.

Countries like Egypt and Syria have never had particularly significant resources. Egypt has already been hit hard by Gulf states’ move away from Arab labour for the oil industry, and the prospect of losing income from even their own meagre resources is clearly a concern for their respective regimes. Egypt will be hard-pressed to find alternative sources of income, particularly with agriculture already under pressure.

In Syria, some currently argue that a degree of reform/opening is necessary precisely because oil will soon run out (on top of which the ‘rents’ it derived from being a ‘frontline state’ in the collective Arab struggle against Israel evaporate with the decline of that issue on the Arab agenda, as well as the sheer (in)efficiency of certain domestic industries). The re-appearance of EU-Syrian negotiations over a possible Association Agreement is potentially a significant signal from Damascus.

Lybia is a different case again, and at the moment it is using its resources to ease an improvement in relations with the West, in the context of which diversification does not seem to be high on the agenda.

Tunisia and Algeria have provided regular energy exports, diversifying to different (limited) degrees.

But perhaps a better and more general question would be: where will growth come from in the 21st century? Growth in the MENA region will be essential considering the generally very young, and already very large populations in countries like Egypt and Iran. The EU has already recognised the importance of development not least in connection to migration and its socio-political impact on its member states, but there seems little concrete prospect of sustained economic growth capable of safely offsetting population-driven economic and socio-political problems on the horizon.

How will water shortages affect regional security in the 21st century?

Water has been a central problem in certain respects for a long time. In the case of Palestine, for example, even well before the realisation of water shortages, early Zionist settlers focused on water for ideological reasons.

Today, water is scarce as well as fought over for ideological and strategic reasons, there is little evidence that usage of rivers and aquifers are going to be easily agreed collectively – the Nile, Jordan and Tigris-Euphrates rivers immediately come to mind – and, crucially, population pressures on water resources seem set to increase.

Whether this will translate, in itself, into a cause for conflict, however, is a completely different question: conflict is unlikely to be sparked by a single cause, and one also needs to bear in mind again the importance of a permissive international context for local conflict of the magnitude – and especially the implications – which might manifest in the region.

Particularly in the case of the water system centred around Israel/Palestine/Jordan, any kind of large-scale conflict would have considerable implications for the domestic equilibria of most regional states, as the Gaza war over 2008/09 demonstrated.