Geopolitics Weekly
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📰 Iranian diplomacy shifts

📰 Iranian diplomacy shifts

and Turkey's lira hits new low

Ross Crabtree
August 25, 2024

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Hello and welcome back!

In another turbulent week for geopolitics, the Middle East faces severe escalations with intensified conflict in Palestine, Lebanon, and the Red Sea, while Ukraine strikes a strategic Russian airfield in Volgograd.

Turkiye’s economic troubles are increasingly tied to geopolitical instability, and Pakistani security forces have killed insurgents in Balochistan. In news that has gone under the radar, the UN special envoy to Libya warns of a brewing crisis as troops mobilise in Tripoli.

Let’s get into it ⤵️

Top 5 Stories

1️⃣ 🇮🇷 Iranian lawmakers approve President Masoud Pezeshkian's proposed cabinet: Pezeshkian, a reformist who took office in July following the death of former President Ebrahim Raisi in a helicopter crash, secured unanimous parliamentary approval for all 19 ministerial nominees—a rare feat not seen since the term of reformist President Mohammad Khatami 23 years ago. The new cabinet includes Abbas Araghchi as the foreign minister, a seasoned diplomat known for his openness to dialogue with the West. Araghchi, who played a key role in the 2015 Iran nuclear deal, replaces Hossein Amir-Abdollahian, who died alongside Raisi in May. This development suggests a potential shift in Iran's diplomatic approach, especially toward the West, in the aftermath of the 2015 nuclear agreement's collapse following the U.S. withdrawal in 2018.

2️⃣ 🇹🇷 Turkiye’s economic woes linked to geopolitical instability: After 21 years in power, President Erdoğan faces major economic challenges, with scepticism high about his pledge to control runaway inflation by year-end. The crisis has been exacerbated by conflicts with Kurdish separatist groups in Syria and Iraq, as well as instability in the Middle East and Ukraine. Turkiye is grappling with soaring inflation, a crashing lira, and declining investor confidence, with the currency dropping from 3.8 per USD in 2018 to 33.7 in 2024. Despite a decrease in inflation from 71% in June to 61% in July, it remains alarmingly high, straining many citizens as wages lag. Over half the population survives on about $500 USD per month, while most pensioners get just $356. The situation worsened in 2023 when Erdoğan, defying conventional wisdom, cut interest rates to fight inflation. Turkiye’s central bank experienced rapid leadership changes, with five different chiefs in five years resigning or being dismissed over disagreements with rate cuts. Erdoğan later allowed rates to rise, reaching 65% by December, but even with a reduction to 45% in June, doubts persist about its effectiveness in curbing Turkey's severe inflation.

3️⃣ 🇺🇦 🇷🇺 Ukraine strikes Volgograd airfield: Ukraine launched a night-time drone strike on a Kremlin military airfield near Volgograd and announced the capture of another village in Russia’s Kursk region, as Russian forces continued their advance in the Donetsk region. Volgograd Governor Andrei Bocharov confirmed the attack occurred around 3 a.m., with local residents reporting multiple explosions. Hours later, ammunition was still detonating as thick black smoke engulfed the area. Ukraine’s SBU security service claimed responsibility for the strike on the Marinovka airbase, located about 45 miles west of Volgograd, near Kalach-na-Donu. The base houses approximately 30 Su-34 and Su-35 fighter jets, which are used for bombing Ukrainian positions on the frontline. The extent of damage to the jets remains unclear.

4️⃣ 🇸🇾 🇷🇺 🇹🇷 Russia and Turkiye resume joint Syria patrols: Turkish and Russian armoured vehicles have resumed joint ground patrols in northeast Syria, the Turkish defence ministry announced on Friday. These operations, which had been suspended last year due to unspecified security concerns, were relaunched on Thursday in the "Operation Peace Spring" zone. Turkiye and its Syrian rebel allies launched "Operation Peace Spring" in 2019 with the goal of pushing back Kurdish-led Syrian Democratic Forces (SDF) from the region. That same year, Turkish President Tayyip Erdogan and Russian President Vladimir Putin agreed to conduct joint patrols under a bilateral deal. The defence ministry confirmed that these joint ground patrols will continue, aiming to stabilise northeast Syria, secure Turkiye’s borders, and showcase Turkish-Russian cooperation in counterterrorism efforts.

5️⃣ 🇩🇪 Islamic State claims responsibility for fatal Solingen knife attacks: A man suspected of carrying out a deadly stabbing spree in Solingen, Germany, has been arrested, according to a state official on Saturday, nearly 24 hours after the attack that left three people dead. North Rhine-Westphalia's interior minister, Herbert Reul, expressed some relief to ARD broadcaster, noting that authorities had been pursuing a "promising lead" which resulted in the suspect's capture. The Islamic State group had earlier claimed responsibility for Friday's knife attack, which also injured eight others. Police had conducted a day-long manhunt, initially making two arrests that turned out to be unrelated to the attack, Reul said.

Major Story

🇵🇸 🇮🇱 ISRAEL’S DEMAND FOR TROOPS IN GAZA REPORTEDLY PREVENTING CEASEFIRE

Disagreements over Israel's military presence in Gaza and the release of Palestinian prisoners are hindering a potential ceasefire and hostage deal, according to sources involved in the recent US-mediated talks. These sources, including Hamas officials and Western diplomats, revealed that the disputes have intensified due to new demands from Israel. Specifically, Israel wants to maintain troops along the Netzarim Corridor, a strategic area that restricts Palestinian movement between northern and southern Gaza, as well as along the Philadelphi Corridor near the Gaza-Egypt border. These demands have become major sticking points in the negotiations, even after Hamas accepted a previous ceasefire proposal by U.S. President Joe Biden in May.

Philadelphi and Netzarim Corridors

Israel's current control over the Philadelphi Corridor, Gaza's border with Egypt, has become a major point of contention in the ongoing ceasefire negotiations. Hamas accuses Israel of changing the terms at the last minute, fearing that any concessions could lead to further demands. Despite Israel's denial of introducing new conditions, sources close to the talks indicate that Israel's latest proposals include maintaining a military presence in key areas like the Netzarim Corridor, which limits Palestinian movement. This perceived shift in Israel's stance has led to frustration among mediators and Hamas, who had hoped to build on earlier agreements. U.S. Secretary of State Antony Blinken has been working to narrow these differences, urging both sides to accept a new U.S. proposal. However, the details of this proposal and the exact terms of Israel's military presence in Gaza remain undisclosed, with both sides needing to finalise the implementation agreements.

Future talks

The next round of US-mediated talks between Israel and Hamas is expected to take place in Cairo soon, centering on a US bridging proposal. High-level officials including CIA Director Bill Burns, Mossad Chief David Barnea, Qatari Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani, and Egypt's lead negotiator are anticipated to attend. Before heading to Cairo, Sheikh Mohammed is scheduled to visit Tehran.

Hamas officials have expressed concerns over the proposal, particularly regarding Israel’s continued military presence along Gaza’s crossings and the deportation of Palestinian prisoners in any potential swap. A senior US administration official, however, stated that the proposal does not alter previously agreed commitments on the Netzarim Corridor and aims to provide significant benefits for Gaza.

The ongoing disputes over military withdrawal, prisoner releases, and the conditions for a ceasefire continue to hinder the progress of negotiations. Despite these challenges, mediators are striving to keep the dialogue open, aiming to bring an end to the conflict and secure the release of remaining hostages.

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Other News

1️⃣ 🇹🇼 🇨🇳 Taiwan flexes missile firepower on ‘rare trip to sensitive test site’: Taiwan showcased its missile capabilities on Tuesday, conducting live-fire tests of surface-to-air missiles at a sensitive test site along the island's southeastern coast. The demonstration, observed by reporters, is part of Taiwan's efforts to bolster its defence in response to increasing Chinese military activity. China views Taiwan as its own territory, and tensions have risen as Beijing intensifies its sovereignty claims. Missiles play a central role in Taiwan's defence strategy, including both U.S.-made systems and domestically developed technology. At the Jiupeng base in Pingtung County, the military launched U.S.-made Patriot missiles and Taiwan-made Sky Bow III missiles at dawn, while a warship offshore fired a RIM-66 Standard missile.

2️⃣ 🇵🇰 Insurgents killed in Pakistan’s southwest: Pakistani security forces have killed three insurgents linked to the recent assassination of a senior official in the southwest, the military reported Tuesday. The raid occurred in Mastung, Baluchistan province, where members of the outlawed Baloch Liberation Army (BLA) ambushed and killed Deputy Commissioner Zakir Baloch on August 12. The military confirmed the insurgents were behind Baloch's death and other attacks. Prime Minister Shehbaz Sharif praised the operation and reaffirmed the government's commitment to eradicating terrorism. The BLA, which claimed responsibility for the killing, has not yet responded but is expected to retaliate. Authorities noted that the BLA has allied with the Pakistani Taliban, which, along with other militant groups, remains active in Balochistan, a province long plagued by insurgency and violence.

3️⃣ 🇪🇺 🇨🇳 European Union poised to implement 37% EV tariff on China: The European Commission announced plans to impose five-year import duties of up to 36% on Chinese electric vehicles (EVs) unless Beijing proposes an alternative to address concerns over state subsidies. Tesla's China-made EVs will face a reduced 9% duty due to lower subsidy levels. Last month, Brussels imposed provisional tariffs on Chinese EVs, adding to the existing 10% duty, after finding they were undermining European competitors. The Commission now seeks to make these tariffs permanent, with a final decision expected by October. Proposed tariffs include 17% for BYD, 19.3% for Geely, and 36.3% for SAIC. China opposes these tariffs and has appealed to the World Trade Organization. The EU insists China must propose solutions that comply with WTO rules. This trade dispute highlights broader tensions between China and the EU, as China's EV exports to the EU surged by 70% in 2023.

4️⃣ 🇾🇪 🇮🇱 Israeli airstrikes on Yemen may constitute war crimes, say Human Rights Watch: HRW accused Israel of launching indiscriminate or disproportionate attacks on civilian areas during the July 20 strike on Hodeidah, which targeted Houthi military positions near the port. The assault, which struck oil facilities and a power station, killed at least six people and injured over 80. The airstrikes occurred in response to a Houthi drone attack on Tel Aviv the previous day, which killed one person and could also be classified as a war crime, HRW noted. The Israeli bombardment damaged more than two dozen oil storage tanks, two shipping cranes, and a power plant in the Salif district of Hodeidah province. HRW emphasised that the attacks resulted in excessive harm to civilians and civilian infrastructure, warning that willful violations of the laws of war could amount to war crimes.

5️⃣ 🇱🇧 🇮🇱 Israeli strike kills ten in South Lebanon after Hezbollah releases video of 'underground city': This weekend saw the most intense violence since October 8 on both sides of the Israel-Lebanon border, coinciding with mixed signals from recent talks in Doha. The escalation began with an Israeli raid on an alleged Hezbollah arms depot in Nabatieh, resulting in the deaths of 10 Syrian civilians, including children. In retaliation, Hezbollah fired Katyusha rockets at Ayelet HaShahar, marking the first attack on this Israeli site in the current conflict. This escalation came after Hezbollah released a video on Friday, titled "Imad 4," showcasing their "underground city" with tunnels and large missile launchers.

What Went Under the Radar?

🇱🇾 🇺🇳 Libya in crisis, says UN Special Envoy to Security Council: Libya's descent into chaos began with a NATO-backed uprising that ousted and killed longtime leader Muammar Gaddafi. The UN's special envoy to Libya informed the Security Council that the situation in the country has rapidly worsened, complicating efforts for a political resolution. "In the past two months, Libya's political, economic, and security stability has sharply declined. Unilateral actions by political, military, and security actors have heightened tensions, deepened divisions, and made a negotiated solution more challenging." Libyan Ambassador Taher Al-Sunni emphasised to the Council that "the only solution for Libya lies in ending divisions and strengthening institutions through free, transparent, and inclusive elections."

Next Week’s Geopolitical Milestones

1️⃣ 🇵🇸 🇮🇱 🇪🇬 Gaza ceasefire talks to resume in Cairo: Negotiators in Cairo worked on Saturday to address the stalemate between Israel and Hamas, but talks ended with no sign of progress. One Palestinian official involved in the mediation effort noted that Israel remained firm in its demand to maintain eight positions along the Philadelphi corridor. The talks, aimed at securing a ceasefire and hostage release, were held against the backdrop of a worsening humanitarian crisis in Gaza, where malnutrition rates are climbing and a case of polio has been reported. A Hamas delegation was in Cairo, prepared to respond to any new proposals, while the main negotiations involved Israel, Egypt, Qatar, and the United States. A U.S. official confirmed that meetings took place between the American negotiators, Egypt, and Qatar, with the latter two reportedly also engaging with Hamas.