Global Risk Indexes (24-01-2025)

Global 96 (0 —)
MENA 94 (-1 ▼)
APAC 95 (-1 ▼)
Europe 98 (+1 ▲)
Africa 95 (+2 ▲)
AMERs 95 (-2 ▼)
Markets 97 ( —)
Farid al-Khaleqi, Middle East region analyst at Worldwise Analytica

Farid al-Khaleqi

Navigating the Sands of Time, Illuminating the Geopolitical Horizon

Gaza Ceasefire Holds Amid West Bank Violence, Red Sea Risks, and Sectarian Struggles in Iraq: Strategic Implications for MENA

The geopolitical landscape of the Middle East and North Africa continues to be shaped by a blend of fragile ceasefires, deep-seated political disputes, and shifting alliances. January 24, 2025, highlights the region's systemic vulnerabilities, from Gaza's reconstruction challenges to Iraq's evolving sectarian dynamics.

Gaza Ceasefire and Reconstruction: The Gaza ceasefire has provided a crucial respite for the enclave's war-weary population. Aid flows have surpassed the initial targets, with 653 trucks entering on Thursday alone, reflecting improved coordination among international actors. However, the sustainability of this truce hinges on political reconciliation. The phased return of displaced families to northern Gaza underscores the humanitarian urgency, but the lack of long-term governance solutions poses risks. Hamas' control of the process, coupled with Israeli skepticism toward broader Palestinian Authority involvement, exacerbates tensions. The fragile nature of this truce is further highlighted by isolated incidents, such as the recent shelling in Rafah, which threaten to derail progress.

West Bank Operations and Ceasefire Risks: The Israeli military's ongoing operations in Jenin, which have killed at least 12 Palestinians and displaced hundreds, directly challenge the stability of the Gaza ceasefire. The operation targets Iranian-backed groups, reflecting Israel's broader security concerns about Tehran's regional influence. However, the U.N.'s concerns over the killing of unarmed Palestinians and expanding settlements highlight the risk of reigniting broader regional tensions. The simultaneous pressure from far-right Israeli political factions on Prime Minister Netanyahu to resume hostilities in Gaza further complicates the situation.

Yemen's Maritime Crisis and Global Trade: Houthi forces' continued detention of U.N. personnel and sporadic attacks on Red Sea shipping underscore their disruptive potential. Despite their stated intention to curb attacks on non-Israeli-linked vessels, their capacity to escalate remains a significant threat to global trade. Maersk's decision to divert ships away from the Gulf of Aden and the Bab-el-Mandeb strait highlights the enduring risks to critical energy and shipping routes, emphasizing the need for robust maritime security initiatives.

Iraq's Sectarian Challenges: The Iraqi parliament's amnesty law and amendments to personal status laws reflect attempts to address longstanding sectarian divides. However, these measures risk entrenching divisions rather than resolving them. Allowing Iraqis to choose sect-based jurisprudence could institutionalize sectarianism, undermining national unity. Meanwhile, disputes between Baghdad and the Kurdistan Regional Government (KRG) over oil resources in Kirkuk illustrate the enduring power struggles that hinder Iraq's stability and economic recovery.

Diplomatic and Economic Shifts in the Gulf: Saudi Arabia's efforts to deepen economic ties with the U.S., including a proposed $600 billion investment package, signal its strategic pivot to counter economic and political pressures. However, Qatar's legislative reforms to attract FDI highlight the disparities among Gulf states in navigating economic diversification. In the broader context, U.S. calls for lower oil prices to pressure Russia over its war in Ukraine add an external layer of complexity to Gulf economic strategies.

Strategic Implications: The dynamics across MENA reflect a volatile equilibrium. While Gaza's reconstruction efforts provide a glimmer of hope, the risks of ceasefire breakdowns, as seen in the West Bank and Yemen, remain high. Iraq's sectarian reforms and Gulf economic initiatives highlight the interconnectedness of domestic governance and regional stability. To mitigate these risks, sustained international engagement and coordination will be critical in addressing both immediate crises and long-term structural vulnerabilities.

Geopolitical Risk Assessment for the Middle East
(24-01-2025)

The region remains in a precarious state due to unresolved crises and fragile ceasefires. While there are signs of progress in Gaza and regional diplomatic engagement, systemic risks tied to proxy conflicts, sectarian divisions, and economic challenges persist, keeping the risk level elevated.

Geopolitical Risk Index

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