With the December collapse of the Assad regime in Syria, 2024 came to a close in a dramatic and region-altering fashion. This, along with the numerous other major trend lines and points of conflict, likely makes 2025 a year that will be significant in reshaping the region’s future. Looking forward to what may be coming, Afkār has brought directors from the Middle East Council together for a Council Views 2025 outlook edition.
The Road Ahead is Momentous and Unpredictable
There is little question that 2024 will be remembered as one of the most consequential years in the history of the modern Middle East. The fires that were ignited in late 2023 were to profoundly alter the region’s geopolitical landscape in 2024. Yet things remain far from settled. The outcome of this reformation now hinges on variables too numerous, complex, and intertwined to be forecasted with any confidence.
How will Iran respond to the severe debilitation of the “axis of resistance,” its forward defensive structure that it spent decades building across the arc of the Levant? In what ways will it seek to restore its deterrence or recalibrate its regional strategy, including potentially through the acquisition of nuclear weapons? How will Hezbollah respond to the loss of its supply corridor to Iran and the potentially long-term Israeli presence in south Lebanon? Will it revise its own approach to Lebanese and regional politics, as well as its relationship with its longtime benefactor in Tehran?
What is in store for Palestinian politics in the year ahead now that Gaza has been reduced to smoldering rubble, and its people still trapped in unimaginable and unending suffering and violence? Will Israel continue to ethnically cleanse the strip, and will it finally annex the West Bank formally, after years of consolidating its grip on the entirety of Palestine?
Can a new, more stable and prosperous Syria emerge from the ruins of 14 years of war and 54 years of brutal dictatorship, with so many external parties still exerting their influence throughout its fractured territory? And will forces in neighboring Iraq, wary of Iran’s constant meddling, use the sudden vacuum to change the political equation at home?
How will the incoming Trump administration approach a region that has changed dramatically since he was last in office? The president-elect and his cabinet of pro-Israel hawks are already promising that “all hell will break loose in the Middle East” if Hamas does not release hostages before he enters the White House while signaling plans to re-impose “maximum pressure” on Iran, pursue Israel-Arab normalization with renewed vigor, and endorse Israeli annexation of the West Bank. But how will the Gulf states respond to this given their own rapprochement with Iran and clear demands for a Palestinian state? Will they chart a new policy course or simply acquiesce to pressure from Washington?
And perhaps most consequentially, will this be the year in which the peoples of the region, bearing witness to all that has transpired, make their voices heard once again?
These questions are just the tip of the iceberg. Trying to predict what will happen in such a fluid and combustible environment is a fool’s fancy. A different outcome in any one of these variables could change the equation for all the others. The most many of us can do is watch and try to make sense of it all.
Economic Divergence in the Arab World Accelerates
The drivers of geopolitical insecurity and instability in the Arab world will deliver in 2025 another year of subdued economic outcomes for the region as a whole but especially in fragile countries, conflict zones and their neighborhoods. As a result, the divergence in economic performance—at the aggregate level and on a score of developmental and institutional metrics—between the more confident, dynamic and outward-oriented Gulf economies and the largely stagnant, inward-focused and vulnerable Levant and Maghreb regions will persist in the coming few years.
But the divergence in performance between the Gulf and the rest could also accelerate if the world economy undergoes faster fragmentation in trade and investment flows as a result of the intensifying rivalry between the United States and China. Heightened competition between the two superpowers would favor the more politically stable, resource-rich and institutionally resilient Gulf states that have maintained strong relations with the U.S. and increasingly balanced them with China. They have deepened their trade, finance and logistical linkages with the international system to take advantage of the reorientation of supply chains, and have demonstrated a readiness to lead with big investments in the strategically important technologies and industries of the future at home and abroad.
Assuming the incoming Trump administration carries through with its threats to raise tariffs and potentially trigger trade wars that would engulf friend and foe alike, the Gulf again would be in a stronger position relative to the rest of the Arab world. They have cultivated robust political and institutional relationships with the U.S. government, possess financial and political bargaining chips to negotiate bilateral deals, and are more accustomed to the transactional style of the U.S. president. By contrast, the more EU-dependent countries in the Levant and Maghreb region suffer from closer ties to a block that is underperforming economically, lacking in political confidence, facing growing geopolitical vulnerabilities, and increasingly view relations with these regions through a narrow prism of energy and border security.
As the retreat of globalization marches on and gives way to growing competition and economic nationalism, countries around the world are being pushed to calibrate their economic policies to the requirements of the new era where states play a bigger role in shaping outcomes. This is familiar terrain for the Gulf countries, where state intervention and industrial policy have long guided the organization of their economies. Saudi Arabia’s ongoing massive transformation and the ambitious long-term visions announced by other Gulf countries should be understood in part as a response to the emerging risks and opportunities in a changing world economy. Elsewhere in the region, governments are preoccupied with short-term economic stability or attempting post-conflict recovery.
The widening gap between the Gulf economies and the rest of the region, which commenced at the turn of the millennium, gathered momentum in the aftermath of the Arab Spring, is becoming a permanent feature of the regional economy.
The Road Ahead for Syria and the Importance of Setting Priorities
On December 8, Syria’s Assad regime collapsed after 54 years of brutal authoritarian rule and a devastating 14-year conflict that took the lives of more than 500,000 people and displaced 60 percent of the country’s population. A caretaker government has been established to oversee state operations while a political transition gets underway. Ahmed al-Sharaa, Syria’s de facto leader, has signaled that it might take up to four years to hold elections, allowing time to consolidate disparate parts of the country, support the return of refugees, organize a national dialogue, negotiate and draft a new constitution, and conduct a population census. Meanwhile, the main priorities will be maintaining security and placing the country on a path towards economic and social recovery. Setting priorities will be key, and the international community should play a positive role.
The top priority for Syria is maintaining security. The country was fortunate to have avoided a final showdown between regime and opposition forces that might have resulted in governmental collapse–similar to Somalia in 1991. To its credit, the caretaker government has, so far, avoided some mistakes of other regime changes that might have undermined the security situation in Syria. For instance, it has kept the structures of government intact, worked to consolidate the country’s disparate militias into a new national army, and sought to minimize retribution against minorities, especially those from Assad’s minority Alawite sect. The new government has also exhibited restraint in not engaging with armed groups in areas outside its control. Building on this security work and institutionalizing the efforts will remain the top priority of the transitional government and must be supported by all international actors.
Urgent action is also needed on the economic front. For 2025, the focus should be on delivering humanitarian assistance and launching economic recovery and reconstruction efforts. Between 2011 and 2023, the Syrian economy contracted by up to 80 percent; nearly 5 million refugees fled the country; infrastructure was destroyed; and institutions atrophied. The poverty rate reached 90 percent and Syrians had limited access to electricity and other basic services. In the coming year, economic activity will increase as people return home and businesses reopen. However, for refugees to want to return, they require safety and security, economic opportunities, and basic services such as electricity. Syria has begun receiving assistance to restore these basic services. However, it also needs help to improve economic conditions and support business investment in order to create needed jobs.
The international community can help. Most importantly, economic sanctions, put in place to punish the Assad regime, must be removed without conditions. The old regime is gone and maintaining sanctions will end up punishing the victims of its brutal rule. Funds are also needed to rebuild the country’s infrastructure, rehabilitate its institutions, and support people and communities to rebuild their lives. This support will require technical and financial assistance from international donors. While removing the heavy stick of sanctions should be unconditional, donors can choose to offer the carrot of financial and technical support with conditions. It is then up to the government and the Syrian people to negotiate the terms.
The Maghreb’s Transformation: North Africa’s Undeniable Significance
While the Middle East grapples with instability and conflict in Syria, Gaza, and Lebanon, a quieter transformation unfolds in North Africa. Often overlooked amidst the turmoil of its eastern neighbors, the Maghreb remains a region of profound importance and a bellwether for the Arab world. The Maghreb’s future is inextricably linked to global dynamics, and its fate will impact the wider world. This was, after all, where the Arab Spring first ignited in 2011, with Tunisia sparking a flame that would engulf the region.
Today, North Africa faces a unique set of challenges as it navigates a delicate balance between reform, development and stability. The legacy of the Arab Spring continues to reverberate, with each country experiencing its own distinct set of changes:
Tunisia now grapples with a backsliding of its democratic gains. Recent years have seen a concerning concentration of power in the presidency and the erosion of democratic institutions. Economic woes and the rise of populist rhetoric further threaten its fragile progress.
Libya, scarred by years of civil war, remains fragmented and vulnerable to external interference. This instability has profound implications for the political, economic and military landscape of the country.
Egypt, under tight military control, prioritizes stability over political openness, leaving many citizens yearning for a greater say. But this stability is threatened by a faltering economy, grappling with high inflation, currency devaluation and difficulty attracting sufficient foreign investment.
Algeria, despite its veneer of stability, grapples with the challenges of a generational shift and increasing calls for greater political participation. The 2019 Hirak movement, which caught the regime off guard with its widespread protests demanding political reform, shook the country to its core and further exposed the deep-seated desire for change.
In Morocco, political stability prevails, but beneath the surface, deep-seated economic anxieties fester. High unemployment, exacerbated by recurrent droughts and soaring living costs, fueled public discontent in 2024. While the next parliamentary elections are not scheduled until 2026, the government faces a growing challenge in managing these simmering frustrations, especially amongst a youthful population increasingly disillusioned with limited economic prospects.
Adding a layer of complexity, neighboring Algeria and Morocco have been escalating tensions over the Western Sahara issue, dashing hopes for a united Maghreb and greater regional integration.
Economic and Security Headwinds
North Africa faces a daunting economic landscape, further complicated by security challenges. High youth unemployment fuels social unrest and creates fertile ground for radicalization. Over-reliance on tourism and hydrocarbons leaves economies vulnerable to external shocks. Diversification efforts face hurdles of bureaucracy, corruption, and a lack of investment in key sectors.
These economic woes are intertwined with security concerns. Chronic instability in the neighboring Sahel region spills over into North Africa, with jihadist groups exploiting porous borders and weak governance. The growing influence of external actors, including Russia, Türkiye, and the UAE, further complicates the security landscape.
A Region in Flux
Despite these challenges, North Africa possesses significant potential. A young and growing population, strategic geographic location, and abundant natural resources offer opportunities for growth and development. Realizing this potential requires bold leadership, sound governance, and inclusive economic policies. Though the world’s attention may be focused elsewhere, ignoring the Maghreb would be a grave mistake. The region’s challenges—political transitions, economic instability and security threats—have significant implications for migration flows, regional stability and the fight against extremism. The Maghreb’s future is inextricably linked to global dynamics, and its fate will impact the wider world.
Trump, Israel and Iran: A Combustible Mix?
On January 20, President-elect Donald Trump will be back in the Oval Office. One of the biggest challenges facing the next administration will be formulating a new Iran policy, not only in terms of its nuclear program but also responding to Iran’s regional posture and ambitions vis-a-vis the MENA region.
Early indications based on Trump’s appointees portend a more hardline approach towards Iran than even his first administration. The administration will most likely reinstate its “maximum pressure” policy which will include stringent economic sanctions, diplomatic isolation and robust support for regional allies to counter Iran’s nuclear ambitions. There are some calls from within the U.S. foreign policy establishment to attempt to engage with Iran diplomatically, albeit as a “last chance” before the U.S. pursues a military option to dismantle its nuclear program.
Israeli policymakers see engagement with Iran as futile and will be strongly encouraging the new administration to consider military options. Given that Israel does not have the capability to strike Iran’s nuclear program effectively on its own, Netanyahu’s ambition has long been to draw the U.S. into conflict with Iran. Since the October 7 Hamas-led attack on Israel, the Biden administration has resisted Israeli pressure on that front, but Trump may be more open to it, and indeed some reports indicate that incoming Trump administration officials are already deliberating the issue.
Israel has historically been able to leverage its considerable lobbying firepower in Washington to influence America’s Iran policy. During the Obama administration, AIPAC spent millions of dollars to torpedo the JCPOA nuclear agreement, which Trump withdrew once he was in office. AIPAC also began investing directly in political races for the first time ahead of the 2022 primaries through the creation of a super PAC, and boasted last November that all 362 primary candidates it endorsed won their races. This means it wields influence over a huge crop of congressional representatives, which it could bring to bear on their support for strikes on Iran. After Tehran retaliated against Israel last April for strikes against its embassy in Damascus, the U.S. House passed more than 14 individual pieces of legislation (while introducing several more) that target Iran and affiliated groups around the region. In the Senate, Lindsey Graham sponsored resolution 106 to authorize the use of the U.S. Armed Forces against Iran for “threatening the national security of the United States through the development of nuclear weapons.” Unfortunately, when it comes to the U.S.’s Iran policy and Israeli influence in Washington, it has become a case of the tail wagging the dog.
Dogs and tails aside, a military strike on Iran would be disastrous for the MENA region and, indeed, the world. Although Iran had a tough 2024, from the death of its president in a helicopter crash, to Israel battering its allies Hamas and Hezbollah, to increased economic pressures, the country still retains significant military capabilities. An attack that does not take out all nuclear facilities and capabilities could prompt Iranians to race toward developing nuclear weapons in order to guarantee regime security. Even if such an attack destroys all of the facilities, however, Iran would still retain the technical know-how to produce a bomb and may have set aside enough material to develop a small number of weapons. Additionally, if Iranian facilities are attacked, U.S. and Western installations in the GCC may also come under attack in response, bringing instability to Gulf countries that are focused on their ambitious domestic development plans with little appetite for a direct confrontation with Iran. Iranians may also sink large ships and block navigation in the Strait of Hormuz, like it did during the Iran-Iraq War, plunging the global economy into a crisis.
It is for all these reasons and more that the incoming U.S. administration should pursue some type of diplomacy with Iran. Given the pressure they are under, the Iranians would likely be open to negotiations, making room for diplomacy. The U.S. must resist Israeli pressure to attack Iran, which would most likely drag the region into a wider war and further chaos.