Global Risk Indexes (26-01-2025)

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

Farid al-Khaleqi

Navigating the Sands of Time, Illuminating the Geopolitical Horizon

Fragile Ceasefires and Proxy Rivalries Define MENA's Path Forward Amid Global Trade Risks and Political Shifts

The week of January 20'25, 2025, showcased the complexity and interconnectedness of challenges in the Middle East and North Africa. While the Gaza ceasefire represents a critical moment for de-escalation, broader structural and geopolitical vulnerabilities across Yemen, Syria, and Lebanon continue to shape the region's precarious trajectory.

Efforts to stabilize Gaza reflect the region's potential for progress, yet they remain fraught with challenges. The continued flow of humanitarian aid, with over 4,200 trucks entering Gaza in six days, underscores improved international coordination. However, governance remains a core concern as Hamas reasserts control, sidelining the Palestinian Authority. The phased prisoner exchanges highlight the complex negotiations underpinning the ceasefire but also reveal lingering mistrust among stakeholders. Without a durable political framework, Gaza's reconstruction efforts risk entrenching divisions rather than fostering peace. The West Bank remains a flashpoint, as ongoing Israeli military operations, particularly in Jenin, challenge the broader stability of the ceasefire and highlight the underlying tensions between Israeli domestic politics and its regional security posture.

In Yemen, the Houthis' actions continue to disrupt global trade while reflecting their alignment with Iran's broader regional strategy. The designation of the Houthis as a Foreign Terrorist Organization by the U.S. may curtail some of their activities but risks exacerbating the humanitarian crisis, with aid delivery and port access already reduced by 75%. Shipping companies like Maersk's decision to divert routes further underscores the economic toll of instability in the Red Sea. These developments position Yemen as a central node in the region's ongoing proxy conflicts, with ripple effects on global energy and trade security.

Syria remains in a transitional phase, with cautious optimism surrounding the return of refugees and international engagement. The post-Assad administration's calls for constitutional reform and investment suggest progress, but enduring economic sanctions and resistance to Kurdish integration complicate these efforts. Turkey's insistence on Kurdish disarmament continues to strain U.S.-Turkey relations, reflecting the broader challenges of navigating Syria's fragmented power dynamics. Refugee optimism, while significant, must be matched with tangible reconstruction efforts to translate into long-term stability.

Meanwhile, tensions in Lebanon threaten to unravel the fragile ceasefire in southern territories. Israel's continued military presence and Hezbollah's defiance highlight the fragile balance between short-term stability and the potential for renewed conflict. The situation underscores the vulnerabilities of Lebanon's political landscape, which remains susceptible to external pressures and internal fragmentation.

Strategically, the Gulf states continue to navigate economic recalibrations amidst global challenges. Saudi Arabia's proposed $600 billion investment package with the U.S. underscores its adaptability and ambition, yet disparities among Gulf states remain evident. Qatar's ongoing reforms to attract foreign direct investment, including new legislative measures, illustrate the uneven progress in diversifying regional economies. External pressures, such as U.S. calls for lower oil prices to counter Russia, further complicate the region's economic strategies.

Strategic Implications: The interconnected crises in Gaza, Yemen, Syria, and Lebanon highlight the fragility of progress across MENA. The Gaza ceasefire remains a critical test case for broader peace-building efforts, but unresolved governance and security challenges risk destabilizing the region further. Yemen's maritime instability and the Red Sea's vulnerability emphasize the global economic stakes tied to regional security. Syria's transitional governance and refugee dynamics underscore the importance of inclusive solutions, while tensions in Lebanon reflect the enduring risks of external and internal divisions. Collectively, these developments illustrate the urgent need for coordinated, multilateral strategies to address both immediate crises and long-term structural vulnerabilities in MENA.

Geopolitical Risk Assessment for the Middle East
(26-01-2025)

The MENA region remains deeply fragile, marked by tenuous ceasefires, systemic governance challenges, and the interplay of proxy conflicts. While efforts in Gaza and Syria offer cautious optimism, risks tied to Red Sea instability, regional rivalries, and economic disparities highlight the enduring volatility.

Geopolitical Risk Index

Developments to Follow for the Middle East (See All Global)

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