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Iran strikes Israel. How will Netanyahu respond?
On Saturday, Iran launched roughly 300 drones and missiles at Israel in retaliation for Israel’s April 1 bombing of the Iranian consulate in Syria. Some 99% of Iranian projectiles were destroyed by a combination of Israel’s Iron Dome defense system, US firepower, and assistance from Britain, Germany, and reportedly Jordan and Saudi Arabia. Israel suffered minimal damage and no casualties.
The question now is what comes next, for the region, the Israel-Hamas war, Israeli Prime Minister Benjamin Netanyahu, and the world’s great powers?
The region
The slow-motion nature of the attack, which gave Israel and its allies hours to prepare, led some analysts to call itmore symbolic than serious. However, it allowed Iran to gauge Israel’s capabilities, see who would come to the Jewish state’s aid, and learn how other regional powers and groups would respond to an Iranian barrage.
Both Jordan and Saudi Arabia came to Israel’s defense, according to Israeli military intelligence. The two monarchies both have close ties to the US, Jordan shares a border with Israel, and there is no love lost between Iran’s Shi’a fundamentalist government and the Saudi Sunni monarchy and religious authorities.
But according toMasoud Mostajabi, deputy director of the Middle East Programs at the Atlantic Council, “… if tonight's attacks escalate into a wider Israel-Iran conflict, regional actors perceived as defenders of Israel may find themselves targeted and dragged into the regional conflagration.”
What might Israel do?
US President Joe Biden wants Bibi to “take the win” and not retaliate, but Israel could use the attack as a reason to bomb Iran’s nuclear program or other Iranian military installations.
Netanyahu’s cabinet is divided. Hardliners are calling for a tough response, with National Security Minister Itamar Ben Gvir saying Israel should “go crazy.” Netanyahu rival Benny Gantzsaid Israel will “exact a price from Iran in a way and time that suits us.” And Defense Minister Yoav Gallant says Israel has the opportunityto form a strategic alliance with nations, including the United States and Germany.
According to Hebrew-language media reports, the security cabinet has authorized the war cabinet – whose only voting members are Gantz, Netanyahu, and Gallant – to ultimately make the decision. A possible clue to that response came Sunday as Gantz declared that Israel must strengthen the “strategic alliance and the regional cooperation” that allowed it to overcome Iran’s attack.
“Israel is currently weighing options. Strikes on Iran directly are possible, but it appears that the war cabinet is divided over how to respond,” says Eurasia Group analyst Greg Brew. “Bombing Iran in response to Saturday's attack would likely escalate the confrontation and compel Iran to attack again – this time with less warning and stage-managing.”
The Israel-Hamas War and Bibi’s future
Iran has warned that attacks by its allies won’t stop until the war in Gaza ends – but that ending is still nowhere in sight. On Sunday,Hamas rejected the latest proposal for a deal presented a week ago by mediators Qatar, Egypt, and the United States.
According to Eurasia Group and GZERO Media President Ian Bremmer, the Iranian attack is “going to be a big distraction away from the war in Gaza. [This] doesn't mean that Israel suddenly loses its isolation or wins the PR war globally,” he says, “And there's also less pressure for Netanyahu to be forced out domestically in the near future.”
Great powers unite
The US made it clear that it wants no further escalation. Bidenalso told Netanyahu that the US would not participate in any offensive operations against Iran.
The G7 issueda statement affirming their support for Israel and condemning Iran, saying that an uncontrollable regional escalation “must be avoided.” They demanded that Iran and its proxies cease their attacks and “stand ready to take further measures now and in response to further destabilizing initiatives.”
Iransaid a “new equation” in its adversarial relationship with Israel had been opened, and warned of a “much bigger” assault on the country should Netanyahu retaliate to Saturday’s assault.
WhileBremmer does not see this leading to World War III, he says the “potential that this war expands and eventually does drag in the United States and Iran more directly is also going up. ”Oil money meets AI
Discussion of the global race for AI dominance and influence often centers on the United States and China, with Europe forcing itself into the discussion with groundbreaking regulation and the occasional influential startup. But in the Persian Gulf, wealthy states are just as serious about getting in on this powerful — and lucrative — technology.
The New York Times reported last week that the Kingdom of Saudi Arabia plans to create a $40 billion fund solely to invest in artificial intelligence. If this comes to fruition, it will make the Saudi government the world’s largest investor in AI. Next door, the United Arab Emirates has similar ambitions. Through Abu Dhabi’s Advanced Technology Research Council, the government poured millions into a powerful large language model called Falcon, only to release it open-source in September. Meanwhile, OpenAI chief Sam Altman has reportedly sought upwards of $7 trillion from funders including the UAE for a global chip startup.
Alexa Parks, an associate at the Eurasia Group, says both countries have been “relatively ahead of the curve” on AI with the UAE appointing the world’s first AI minister in 2017 and Saudi Arabia declaring in 2020 that it sought a domestic AI market worth $135 billion by 2030.
For Saudi Arabia, in particular, technology is “one of the few non-oil sectors that has successfully and consistently attracted significant foreign direct investment pledges,” Parks says. Both countries have pledged massive amounts to building data centers necessary for running powerful AI, plans that may put them in competition for regional dominance. The two countries seek global influence in the increasingly important AI market, but also financial returns on their investments.
Saudi Arabia and the UAE are in some ways caught in the middle of a broader economic and technological war between the US and China over AI. The US has enacted strict export controls on AI and semiconductor technology with the aim of kneecapping China, especially their military ambitions with AI. G42, one of the UAE’s largest tech firms recently cut ties with China, which should position them to better engage with US-based AI companies in the future. “We haven't seen any Saudi firms be forced to make this choice yet, but it seems likely that it will happen eventually,” Parks says. “Until then, Riyadh will be content to pursue Chinese and Western tech ties and investments to build up its local tech sector as much as possible.”
On Friday, we saw some signals that some US-based AI companies won’t be so quick to take on the potential regulatory risks related to taking Gulf money: Anthropic is reportedly lining up new investors, but already ruled out Saudi Arabia’s sovereign wealth fund, citing national security risks.
These countries’ deep-pockets and investments will make them unavoidable players in the artificial intelligence race, but in order to succeed they may need to choose sides in a broader conflict—though some major players will just flatly reject their money.
Sending NATO troops to Ukraine unlikely despite Macron's remarks
Are Western troops likely to end up on the ground in Ukraine?
If Western troops we mean NATO troops, I think it is very, very unlikely indeed. All this is a big flap in response to a question the French President, Emmanuel Macron, said it wasn't off the table, something needed to be thought about. The German chancellor almost immediately clapped Macron back. Didn't really need to do that. You already had the NATO secretary general, others saying more needs to be done to support the Ukrainians, more economic support, more military support, need to get the Americans to tee up for 2024. Most of NATO is all there. But of course, Macron, when he gets frustrated, he gets flustered. He likes to make a name. He likes to make headlines. Got a little trouble for that. It was a bit of an own goal. We've seen that before. But I don't think there's actually that much news being made.
How might Sweden's entry into NATO reshape defense policies and military partnerships in the region?
Well, let's keep in mind that unlike countries like Finland and Poland and the Baltics, which are front line NATO countries vis a vis Russia, Sweden is not. That's one of the reasons why their total defense spend was something like 1.2% of GDP. They will ramp that up significantly. They will reach 2% quickly and not that hard for them to do. They're small economy and very wealthy now that they are finally joining NATO. They also are very good in terms of military equipment. They have a significant defense industry and they export a lot of it. They work closely with NATO allies. So in that regard, they'll be quite significant. I think they matter. But, you know, again, it's a small country. It's really the symbolic fact that the NATO is expanding and continuing to expand because of the Russian invasion of Ukraine.
Is Saudi Arabia poised to assist Zelensky in advancing his peace plan?
Well, the Saudis did host the most successful one of the most widely attended peace meetings for Ukraine so far. The Russians weren't there, but the Chinese were, as opposed to the meeting that just occurred in Switzerland a little over a month ago. They've also helped to facilitate transfers of POWs between the Russians and Ukrainians. That's very far from saying that we have diplomacy that's going to work, especially because Putin sees no reason. He thinks he's doing well right now and he can't wait to see what happens in the US elections in November. So I don't think there's much going on. But the Saudis certainly want to show that they want to be useful. And it's not just there. It's of course also in their own backyard. They get a lot of money, a lot of leadership. They are leading the GCC. It's a country everybody needs to pay attention to. Certainly very far from where they were a few years ago.
Hard Numbers: Accusations fly over Russian air crash, diplomats get a booze spot in Riyadh, Korea’s Dior look is a bad one, Egypt catches strays from Houthi resistance, prices stay spicy in Mexico
74: The death toll from Wednesday’s fiery crash of a Russian military plane near the Ukrainian border is up to 74. At least 65 of them were Ukrainian POWs set to be released as part of a prisoner exchange. Moscow says Kyiv shot down the plane, while Kyiv says Moscow was responsible for properly identifying the aircraft as it flew through a warzone. Both sides have been ramping up air attacks – and air defenses – as the ground phase of the war has become a rat-infested stalemate.
1: There will finally be at least one (but only one) store where foreign diplomats can buy booze in the Saudi capital of Riyadh. The location – which will cater strictly to non-Muslims vetted by the foreign ministry – is set to open in the coming weeks. The move is part of the Kingdom’s cautious ongoing efforts to liberalize its strict Islamic social rules in order to attract more tourism and non-oil investment.
2,250: The bag is back in Seoul. Last year, a video emerged showing the South Korean first lady accepting a $2,250 Dior purse as a gift from a prominent Korean-American pastor. “Don’t keep doing this,” she tells him, “never buy something as expensive as this.” In recent days, that scandal has roared back as President Yoon Suk Yeol reportedly squabbles with members of his party over how to address the issue ahead of legislative elections scheduled for April.
40: Houthi attacks on commercial shipping in the Red Sea are meant to pressure Israel into stopping its siege and invasion of Gaza, but the knock-on effects of that strategy are catching other countries in the crossfire. Egypt’s receipts from the Suez Canal – a major source of Cairo’s hard currency – are already 40% lower than last year, as higher risk (and insurance premiums) scare companies away from the waterway.
4.9: Inflation continued to creep upward in Mexico in January, with consumer prices rising 4.9% on an annual basis in the first half of the month, higher than analysts expected. This is the fifth straight half-month period in which prices have risen, casting doubt on the possibility of the central bank easing rates in the coming months. Mexico will hold a general election in June.Could Saudi Arabia get Israel to embrace a Palestinian state?
Amid growing global calls for a cease-fire in Gaza and rapidly escalating tensions across the Middle East, Arab states and the US are increasingly looking towards a longer-term solution that revives the idea of a Saudi-Israel normalization deal that includes the outlines of a Palestinian state.
At least one Israeli leader isn’t completely opposed to the idea: Israeli President Isaac Herzog on Thursday said that Saudi Arabia formally recognizing Israel would be “key to the ability to exit from the war into a new horizon.”
This came just two days after Saudi Foreign Minister Prince Faisal bin Farhansaid the kingdom would “certainly” be willing to recognize Israel – though only as part of an agreement involving the creation of “a Palestinian state.”
The idea isn’t totally new. Prior to Oct. 7, there was a Saudi-Israel normalization deal in the works too, but Palestinian statehood was not viewed as Riyadh’s top priority at the time.
So just how realistic is this revitalized effort?
“It’s good politics in the US,” and the White House believes “it’s the best way to induce Israel to be more reasonable on the Palestinian issue,” says Hussein Ibish, a senior resident scholar at the Arab Gulf States Institute.
Still there are two big problems.
First, the ongoing war in Gaza. The Saudi ambassador to the US on Thursday said that normalization won't be possible until there's a cease-fire.
Second? An obstacle named Bibi. Israeli Prime Minister Benjamin Netanyahu on Thursday said he has told the US he categorically rejects any calls for a post-war Palestinian state, stating that Israel needs “security control” over all territory west of the Jordan River, which includes the West Bank and Gaza. That’s Bibi’s version of “river to the sea.”
With factions of his hard-right government opposed to making concessions to Palestinians and “no consensus” on governance in post-war Gaza, it’s going to be “difficult to get the necessary pieces aligned over the short-term” for any normalization deals, says Sofia Meranto, a Middle East analyst at Eurasia Group.
Putting Bibi in a corner? But as Washington and Arab countries continue to champion this approach, it could further isolate Bibi at a time when he’s extraordinarily unpopular in Israel.
Netanyahu is standing in the way of an important diplomatic initiative that could strengthen the Jewish State and stability in the region, says Ibish, and the Biden administration, which wants Bibi gone “as soon as possible,” is making the point to the rest of Israel that this could be possible without “obstruction” from the Israeli leader and “his extremist friends.”
Whether this will bear fruit remains to be seen, but it’s a space we’ll be keeping a close eye on in the days ahead.
2023's biggest winners and losers in global politics
THE WINNERS
Putin
To be fair, things aren’t great for Vladimir Putin – NATO is still stronger, and his economy is weaker than it’d be if he hadn’t invaded Ukraine. But from a low bar, 2023 was a clear winner for the Russian strongman. Ukraine’s vaunted counteroffensive failed to impress, Western attempts to cap the price of Russian oil faltered, and even an insurrection by his warlord-in-chief only seemed to make him stronger. Putin heads into 2024 happily watching the US Congress squabble over further aid for Ukraine, and who knows, next Christmas might just come early for the Kremlin if Donald Trump can win the US election in November.
Trump
Speaking of which, at the top of this year, the twice-impeached Teflon Don looked like he’d be getting fitted for a prison jumpsuit rather than filing campaign papers. But the bevy of state and federal legal cases against him – some of which were hard for non-lawyers to make sense of – only fired up his base. As a result, he’s not only miles ahead of any GOP challengers for the 2024 nomination, some polls also show him outright leading Joe Biden, who has suffered with voters because of perceptions of his age, inflation, a migration crisis at the southern border, and his controversial handling of the Gaza war.
India
This year, India eclipsed China as the world’s most populous country, defended its title as the fastest-growing major economy, and even landed a spacecraft on the moon. At the same time, PM Narendra Modi used his country’s 2023 presidency of the G20 and his deepening ties with the US to position himself as a vitally important diplomatic bridge-builder between the wealthy G7 countries and the developing nations of the so-called Global South. Popular at home, increasingly influential abroad, and with a flag on the moon to boot, Modi – who faces elections in 2024 – has guided his country to a winner of a year.
Nicolás Maduro
It was a feliz 2023 indeed for the strongman of Caracas. Most of the world quietly stopped supporting his erstwhile rival Juan Guaidó (remember him?), and rising global oil prices forced Washington to rethink its financial stranglehold on Caracas, offering oil sanctions relief in exchange only for some spotty promises that Maduro will hold a free and fair presidential election next year (fat chance.) By the end of 2023, an emboldened Maduro was even feeling frisky enough to threaten to invade his neighbor Guyana.
People willing to play Golf in Saudi Arabia
At first, it seemed inconceivable. Surely the whispers about Saudi Arabia offering golfers hundred-million-dollar contracts to defect to the desert were just fairway gossip, right? But Riyadh made it real when the Saudi-backed upstart LIV Golf absorbed the 107-year-old PGA Golf Tour in June. Critics said the Saudis were just “sportswashing” away an awful human rights record, but supporters said it was time to bust the PGA’s stuffy old monopoly. Meanwhile, the greens look even greener as prize money grows, and even the last-place finishers in LIV tournaments can take home $120,000!
THE LOSERS
AI Cassandras
In March, Elon Musk and a group of artificial intelligence leaders published an open letter warning that AI systems posed “profound risks to society and humanity” and called for a “public and verifiable” six-month pause in “the training of AI systems more powerful than GPT-4.”
It didn’t happen. Increasingly complex and powerful AI systems may indeed pose existential dangers for the human race (alongside their tremendous benefits), but a global pause in any form of technological progress – let alone one this pervasive, powerful, or flat-out entertaining – is impossible to enforce. For the Ancient Greeks, it was Cassandra’s fate to be ignored. But wasn’t it also her destiny to be correct? 2024 will be a huge year for AI.
Benjamin Netanyahu
The wily rightwinger returned to power in Israel late 2022 despite his ongoing legal troubles, but it’s been downhill since. All summer, he faced massive protests over his plan to weaken Israel’s courts. Then, the biggest massacre of Jews since the Holocaust occurred on his watch, prompting fierce domestic criticism of the failures of intelligence and strategy that enabled Hamas to attack on Oct. 7. Israeli society broadly supports Bibi’s stated aims of defanging Hamas and bringing home the hostages (two goals that may in fact be in conflict), but a majority of Israelis still want him to resign.
Migrants on the move
This year the political winds began to shift swiftly against migrants and asylum seekers seeking new lives in the world’s leading economies. In the EU, the number of migrants neared levels not seen since the Syrian refugee crisis in 2016, boosting anti-immigrant politicians and forcing the EU to tighten asylum rules in a long-debated migration policy reform. Meanwhile, in the US, record numbers of undocumented migrants crossed the southern border, empowering Republicans in Congress to hold up funding for Ukraine for tighter border policies. Expect tough talk on migration to play well in the EU Parliament elections next June and the US presidential election in November.
Imran Khan
The hugely popular former Pakistani Prime Minister – who was ousted in a no-confidence vote in 2022 – went from looking like he might sweep back to power in elections this year to being locked up in prison, forced to use an AI replica to get his message out. He was imprisoned in August on corruption charges that he and his followers say are bogus, and the elections that were supposed to return him to power were postponed until next year. His legal troubles may keep him off the ballot entirely. Still, he remains an immensely potent force in Pakistani politics, making a 2024 comeback impossible to rule out.
People who opposed coups in Africa
On the heels of coups last year in Mali and Burkina Faso, this year saw governments deposed in both Niger and Gabon. Niger’s democratically-elected government was overthrown by soldiers from the presidential guard in July. Similarly, Gabon military officers seized power in August, unseating the longtime president shortly after he was declared the winner of a contested election. The recent coups come amid a larger trend of increasingly frequent coups in the region – nine over the past three years – which have harmed economic well-being and raised concerns about regional security.
The very biggest losers: Anyone who didn’t subscribe to the GZERO Daily Newsletter
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