The Middle East Under the Spot Light
Report: June 2022
The World is trying to ween off Russian energy supplies by focusing their attention on the Middle East. Photo credit: Daily News Egypt.
Nearly every nation in the region is struggling to cope with the aftermath of the war in Eastern Europe. Some succeeded in implementing policies that would adequately address ramifications such as grain and fuel shortages. Others still struggle with past hurdles and are finding it difficult to maneuver in the difficult situation, especially when they are still mired with corruption. Nevertheless, the world is looking towards the Middle East to solve the energy crisis and this might provide the required impetus for a new beginning.
1- The Socio Economic Situation
Egypt
The Eurasian Negotiations and the gas deal with the EU, will only bolster Egypt’s role in the world as an economic power and as a reliable partner. June 19, 2022 https://www.egyptindependent.com/.
Corona cases and deaths are reported as follows:
Egypt is reporting 11 new infections on average each day, 1% of the peak.
There have been 514,088 infections and 24,723
coronavirus-related deaths reported in the country since the pandemic beg
The Fitch rating agency, during this month, downgraded the performance of Egypt’s economy from the 5.5 percent it initially predicted to 4.9% or the upcoming FY2022/2023. It cited the Ukraine War as the main reason behind its choice as the series of events in Eastern Europe will lead to higher commodity prices disruptions to wheat supply, lower tourist inflows, and increased risk aversion towards emerging markets. Increased inflation and monetary tightening will be main drivers behind the private sector as private consumption will decrease. As for Egypt’s stock exchange, it lost $870 million in one week as fears of an global economic slowdown is taking place. All these are signs of perilous times coming towards the end of the year.
Despite all this, Egypt is ratcheting its efforts to capitalize on past successes it had achieved. For instance, it is enhancing its economic cooperation with Eurasian Union through a free trade agreement it is negotiating. This should allow Egypt to mitigate the effects of the war in Ukraine, by signing joint cooperation deals with Russia, Armenia, Belarus, Kazakhstan, and Kyrgyzstan. This will provide Egypt with better trade exchange guarantees and enhanced industrial and investment cooperation as well as economic cooperation at all levels.
On the European front, Egypt signed a gas deal with the EU which aims to decrease dependency on Russian fuel. In exchange for Egypt’s timely intervention in the EU’s energy security, European Commission President Ursula von der Leyen pledged relief worth $104 million for food security in Egypt, which has been reeling from grain shortages as a result of the Ukraine war. In other words, Egypt will not only financially gain from the boost in gas delivery to Europe, it will establish itself as a more reliable partner ready to cooperate with Europe when its counts. That’s why the European Commission President was so keen on bolstering Egypt’s food security during such difficult times.
Jordan
Jordan's King Abdullah II and Crown Prince Hussein attend the launch of the Economic Modernization Vision, at the Dead Sea, June 6, 2022 (Reuters).
Corona cases and deaths are reported as follows:
COVID-19 infections are increasing in Jordan, with 125 new infections reported on average each day. That’s 1% of the peak.
There have been 1,699,197 infections and 14,068 coronavirus-related deaths reported in the country since the pandemic began.
During the beginning of June, Jordan revealed a 10-year development strategy at an event dubbed “Economic Modernization Vision” to not only revive the economy but to also double growth. It consists of a number of reforms King Abdullah has been pushing over the past year or so, to help the country accelerate its economy. In a ceremony attended by His Majesty, the plan was shared to attendees: The purpose is to attract 41 billion USD in terms of funds so that the GDP, which is currently at 30.2 billion dinars, to expand to 58.1 billion dinars ($82 bln). This will be done by further liberalizing the economy by empowering the private sector and removing hurdles that investors face. During the event, Prime Minister Bisher al Khasawneh claimed that the government will also unveil in the future a plan to reform the bloated public sector. In other words, a plan will be put in place to address the number of unfruitful public jobs that previous administrations put in place to appease citizens and maintain stability. It is this shortcoming that inflated the public debt to 40 billion USD which is almost 90% of the GDP. Job creation, however, will still be taken into account during this whole ordeal. After all, the aim of the government is to create more job opportunities and not to raise unemployment. For this reason, one million jobs are planned to be created within Jordan within the span of 10 years.
In addition to the Jordan’s strive for reform, investment continues to trickle into the country. For instance, ADQ, an Abu Dhabi-based investment and holding company, signed a $100 million agreement with the Ministry of Digital Economy and Entrepreneurship (MoDEE) of Jordan to support high-growth technology companies and the continued growth of the Kingdom’s burgeoning digital economy.
Iraq
Iraq is gradually recovering from a severe recession, brought on by the COVID-19 pandemic and the drop in oil prices in 2020 (Reuters/File Photo).
Corona cases and deaths are reported as follows:
COVID-19 infections are increasing in Iraq, with 1,194 new infections reported on average each day. That’s 10% of the peak.
There have been 2,341,053 infections and 25,233 coronavirus-related deaths reported in the country since the pandemic began.
After the economy had contracted by 11% back in 2020, it is now registering additional growth. Boosted by higher oil revenues, Iraq succeeded in achieving a surplus in terms of overall fiscal and external balances. Moreover, it is currently seeking to boost crude oil production to 8 million barrels per day by the end of 2027, giving it increased fiscal space to initiate needed changes for its economy. Nevertheless, needed reforms are yet to be seen as the country still struggles with forming an effective government. As such, the country is failing in reorienting its economy into sectors that can improve growth, job creation and greater economic diversification. Its failure to do so have prevented it from addressing problems related to its food security during a time where global inflation is reaching new highs. Currently, its low domestic food production is falling short of demand against a rapidly growing population, an issue that will prove to be problematic in the future. So far, it has tended to the issue with subsidies and direct transfers which it had reaped from oil production. Nevertheless, Iraq’s remains to be in a dangerous situation as global food shortage is becoming ever so problematic. As such, Iraq needs to implement dire macro-fiscal and structural reforms that enhance private sector development, scale up investments in water efficiency and agri-food systems, and transition towards more sustainable sources of energy.
Lebanon
People waiting in line to get some bread at one the bakeries in the south. AFP.
Corona cases and deaths are reported as follows:
COVID-19 infections are increasing in Lebanon, with 948 new infections reported on average each day. That’s 11% of the peak.
There have been 1,108,213 infections and 10,461 coronavirus-related deaths reported in the country since the pandemic began.
With each passing month, Lebanon continues to stagger into an uncertain future. Although the depreciation of the currency on the parallel market has fluctuated between 28500 LBP and 29,300 LBP to the dollar, prices are continuing to increase. For instance, the price of fossil fuels during June, increased to reach a number much higher than the minimal wage in Lebanon. This has impacted wheat prices which have gone up tremendously since the start of the war in Ukraine. Bread shortages are being reprorted too at some locations and stores. Head of Bakery Owners' Syndicate Ali Ibrahim explained that the problem there is not enough subsidized wheat to go around. As such, quantities are no longer sufficient for Lebanon’s needs for more than a few weeks. Meanwhile, hospitals are continously lacking sufficient medication and medical staff are leaving the country as soon as they have the opportunity. Also, counterfeit medicine, which is being imported from abroad, is making its way into the homes of unwarry victims. The reason is the decreased purchasing power of the Lebanese people who can no longer afforde normal medicine. As for the education sector in Lebanon, private schools are operating in difficult circumstances while publics schools are on the verge of collapse, as the country loses a sizable number of its teachers. Also, many students are being pullet out of private schools to be placed in public schools that are being overloaded.
At the same time and at the geopolitcal front , Lebanon is locking horns with its neighbor Israel over a maritime dispute concerning the Karish gas field at its border. Israel has deployed a vessel to reap the rewards of the ocean in terms of gas reserves. As such, this border crisis is escalating into a potential flashpoint where armed conflict might arise. Neither side wants war-supposedly- during time when the regional economy strained. If a showdown does take place, Lebanon will not be able to handle the burdens of mass displacement from the south.
Palestine
A Palestinian youth flashes the victory sign while standing near a flying Palestinian flag in the town of Beita. AFP/File.
Corona cases and deaths are reported as follows:
COVID-19 infections are increasing in Palestinian territories, with 192 new infections reported on average each day. That’s 2% of the peak.
There have been 659,853 infections and 5,660 coronavirus-related deaths reported in the country since the pandemic began
Over the past two years several cash loans have been dispatched to rejuvenate the economy. However, between rocket attacks and Israeli retaliation from one side and corruption within Palestinian circles from the other, there is little room for hope. Till today, Palestine lacks sovereignty and control over its borders and natural resources. Also, structural obstacles, ranging from movement restrictions to Israel’s control over Palestinian external trade, limit the space for private-sector activity. That’s why the share of non-performing loans among Palestinian small and medium-size enterprises (SMEs) is rising. Likewise, household indebtedness is increasing too when sources of livelihood are jeopardized. Recently the World Bank released $37 million in grants to Palestine, to support reforms and social services: 30 million will cover reforms in the areas of transparency, inclusion and the green economy, while the remaining 7 million will fund selected social services, provide short-term cash for services and support online employment opportunities for the most vulnerable populations in Gaza. Of course, none of that is enough to bypass the Israeli authorities’ control over matters. More focus should be spent on dialogue which is key element for Palestine’s sustainability. But with the Palestinian-Israeli relationship continuing to deteriorate, foreign partners should develop a new aid model that better matches realities on the ground.
Syria
A farmer harvests wheat with a combine machine, in the countryside of the northwestern city of Afrin in the rebel-held part of Aleppo province, Syria, June 8, 2022. - Rami Al-Sayed/AFP via Getty Images.
Corona cases and deaths are reported as follows:
There have been 55,923 infections and 3,151 coronavirus-related deaths reported in the country since the pandemic began.
With global economic crisis affecting much of the world, Syria’s GDP will contract by 2.6 percent in 2022 after declining by 2.1% back in 2021. The economy is deemed so bad that some people have not one meal per day. Some even find that Syria was better off during wartime when at least there was food. Now, a wheat crisis is hitting the country and different autonomous and regime-run regions are trying to withhold exporting wheat crops to abroad and halt outbound smuggling activities. In the north of Syria, the opposition government is working on a plan to purchase large quantities of grains, namely wheat, from local farmers with the aim to boost stocks needed to produce bread. Unfortunately, the corrupt will always find a way to blackmail farmers during the worst moments: checkpoints are being set up at cross-borders where farmers are being asked to pay certain royalties or bribes to allow them to pass through. In essence, food security is being threatened by these checkpoints whose armed personnel are not making it any easier on Syrian citizens. Moreover, these activities occur during a time when agricultural production in Syria is at an all-time low.
The wheat crisis is not the only predicament impacting Syria, as inflation is hitting food prices in general and fuel availability. Driven by the noticeable increase in commodity prices, government subsidies on essential food and fuel products have dramatically risen over the past years, accounting for over half of the total budgeted expenditures for 2021 and 2022. To save its budget, Syria’s government has tightened rationing, which has inevitably deteriorated the already dire living conditions of the Syrian people. The WFP data show that over half (52%) of households report food inadequacies. With the global decrease in humanitarian funding, food insecurity will become even more acute.
Cyprus
Larnaca’s International Airport. photo credit: https://www.ekathimerini.com/.
Corona cases and deaths are reported as follows:
Cyprus is reporting 1,037 new infections on average each day, 21% of the peak.
There have been 504,717 infections and 1,036 coronavirus-related deaths reported in the country since the pandemic began.
Cyprus braces itself for a summer full with tourist arrivals as it has already recorded during the beginning of the year impressive numbers: when compared to 2019 before the pandemic ever appeared, it has succeeded in attracting 80% of the number of tourists within the first three months of the year. According to the Deputy Minister for Tourism, Savvas Perdios, the country expects to host over two million tourists this year with summer being the highlight. As such, summer 2022 will be a busy and lucrative period, as many foreigners will be spending their hard-earned money in Cyprus.
Another point worth noting, is Cyprus’s continued intent in developing its green economy. The Cyprus Economy and Competitiveness Council is currently working on creating the Deputy Ministry for Climate, the Environment and Green Sustainability that would allow the implementation of a long-term energy strategy and achieve climate neutrality by 2050. Another role of this ministry is to upgrade the infrastructure and network of the electricity grid through greater use of renewable energy sources.
2- The Refugee Situation
Egypt
The World Food Program released a report claiming that 270,000 people assisted in May 2022 through cash assistance.
The Ministry of Social Solidarity (MOSS), Takaful (Solidarity) Foundation, and WFP trained about 1,700 village women on micro-enterprise management from governorates under the ‘Decent Life’ national program.[1]
The UNHCR, in cooperation with AlSadu Society, organized a five-day training programme on 12 – 16 June for refugee women from South Sudan, Sudan, Syria, and Yemen. The programme aimed to support refugee weavers in Alexandria by providing them with the Sadu traditional weaving skills.[2]
Jordan
The UNHCR states that there are currently 674,458 registered refugees in Jordan up until the beginning of June.
The proportion of Syrian displaced people registered within the UNHCR for June, are distributed as follows:
200,419 in Amman Governorate (29.7 %)
169,786 in Mafraq Governorate (25.2%)
136,182 in Irbid Governorate (20.2%)
98,665 in Zarqa Governorate (14.6%)
18,141 in Balqa Governorate (2.7%)
13,319 in Madaba Governorate (2%)
9,220 in Jarash Governorate (1.4%)
8,660 in Karak Governorate (1.3%)
8,288 in Maan Governorate (1.2%)
6,414 in Ajlun Governorate (1.0%)
3,832 in Aqaba Governorate (0.6%)
1,661 in Tafilah Governorate (0.2%)
The USAID released a report detailing that approximately 191,000 refugees of Syrian and other nationalities were provided with free access to public education through AAI 2.0 project.[3]
Iraq
The UNHCR states that there are currently 260,686 registered Syrian refugees in Iraq.
The proportion of displaced Syrian people registered within the UNHCR up until the beginning of June, are distributed as follows:
131,898 in Erbil (50.6%)
85,324 in Dahuk (32.7%)
33,864 in Sulaymaniyah (13%)
1,572 in Anbar (0.6%)
8,028 in other areas (3.1%)[4]
The Government of Norway has made a new contribution NOK 70 million (approximately US$ 7.5 million) to Iraq’s Funding Facility for Stabilization (FFS), which supports stabilization, durable solutions, and the safe return of internally displaced Iraqis in the five governorates liberated from the Islamic State of Iraq and the Levant (ISIL).[5]
The Korean Government through the Korea International Cooperation Agency Office in Iraq, contributed 6 million USD to UN Habitat to facilitate the sustainable returns of vulnerable displaced population to Sinjar by supporting their housing, land and property rights and improvement of living conditions.[6]
Lebanon
[The number of distributed refugees has yet to be updated]
Since April, the number of registered Syrian refugees in Lebanon is 839,086.
Refugees in Lebanon are distributed as follows:
328,354 in Bekaa (39.1%)
228,758 in North Lebanon (27.3%)
190,636 in Beirut (23.1%)
91,338 in South Lebanon (10.9%)[7]
The Prime Minister Najib Mikati, together with the Minister for Social Affairs Hector Hajjar and the UN Resident and Humanitarian Coordinator Najat Rochdi, officially launched the 2022-2023 Lebanon Crisis Response Plan aiming for 3.2 billion USD to address the ongoing impact of the Syria crisis.[8]
Reported in June, the WFP assisted a total of 1,694,546 beneficiaries through cash-based transfer modalities amounting to USD 28 million and through distribution of family food parcels. The people assisted were 632,898 vulnerable Lebanese, 1,055,761 Syrian refugees, and 5,887 refugees of other nationalities.[9]
The Lebanon Humanitarian Fund (LHF) allocated $16 million to scale up humanitarian response in Lebanon to finance 27 sectoral and multi-sectoral projects for 25 national and international non-governmental organizations.[10]
Syria
In April 2022, the humanitarian community tracked some 13,200 IDP movements across Syria, around 19 per cent less of the numbers tracked in March 2022. As in preceding months, most IDP movements were concentrated in northwest Syria, with 85 per cent occurring within and between Aleppo and Idleb governorates.
In April 2022, the humanitarian community recorded some 8,300 spontaneous IDP return movements across Syria, which was 17 per cent less than the return movements that were tracked in March. Over 2,557 of these movements (31 per cent) occurred within Rural Damascus governorate.
The SRTF announced the delivery of six new combine harvesters to six farmer cooperatives in Ar-Raqqa and Deir-ez_Zor under intervention, "Agricultural Support to Farmers -- Phase V".[11]
Five Primary Health Care Clinics and Two Dialysis Centres in Deir-ez-Zor and Ar-Raqqa Governorates received 128 types of medications and consumables.[12]
In a bid to increase the COVID-19 vaccination rates, Syria completed a 2-week intensified national campaign targeting over 2.5 million people across the country. Through more than 1000 fixed centres and 400 mobile teams, the campaign reached nearly every remote area in Syria to bring the vaccines closer to people.[13]
Cyprus
The country’s Ministry of Education has announced that it will be offering free Greek educational courses to Ukrainian refugees.[14]
A boat carrying over 100 illegal migrants was spotted in the sea area west of Limassol. The vessel temporarily stopped off the coast of Akrotiri in the morning and that two individuals disembarked to seek medical assistance.[15]
Communication and Public Relations Department
[1] OCHA, June 22, 2022, https://reliefweb.int/report/egypt/wfp-egypt-country-brief-may-2022
[2] OCHA, June 21, 2022, https://reliefweb.int/report/egypt/unhcr-and-alsadu-society-organize-training-program-art-sadu-weaving-alexandria
[3] OCHA, June 16, 2022, https://reliefweb.int/report/jordan/accelerating-access-initiative-20
[4] https://data2.unhcr.org/en/situations/syria/location/5
[5] OCHA, June 24, 2022, https://reliefweb.int/report/iraq/norway-reaffirms-its-commitment-stabilization-iraq-us-75-million-contribution-enar
[6] OCHA, June 23 2022, https://reliefweb.int/report/iraq/un-habitat-iraq-receives-generous-support-korea-international-cooperation-agency-koica-promote-peace-and-stability-facilitating-sustainable-returns-enar
[7] https://data2.unhcr.org/en/situations/syria/location/71
[8] OCHA, June 20, 2022, https://reliefweb.int/report/lebanon/launch-2022-lebanon-crisis-response-plan-lcrp-government-un-and-partners-appeal-us-32-billion-enar
[9] OCHA, June 21, 2022, https://reliefweb.int/report/lebanon/wfp-lebanon-country-brief-may-2022
[10] OCHA, 15 Jun 2022, https://reliefweb.int/report/lebanon/lebanon-humanitarian-fund-lhf-allocates-16-million-support-people-need-lebanon-enar
[11]SRTF Fund, https://www.srtfund.org/news/652_the-srtf-delivers-six-combine-harvesters-to-ar-raqqa-and-deir-ez-zor-governorates
[12] OCHA, June 20, 2022, https://reliefweb.int/report/syrian-arab-republic/srtf-supported-primary-health-care-centres-receive-medications-and-consumables-northeast-syria
[13] OCHA, June 17, 2022, https://reliefweb.int/report/syrian-arab-republic/coastal-areas-syria-take-covid-19-vaccination-campaign-new-level
[14] Greek City Times, June 9, 2022, https://greekcitytimes.com/2022/06/09/cyprus-offers-free-greek-lessons-to-ukrainian-refugees/
[15] Cyprus Mail, June 27, 2022, https://cyprus-mail.com/2022/06/27/boat-carrying-irregular-migrants-spotted-off-limassol/