Middle East Ticker

Jordan Appoints New Prime Minister in Effort to Quell Economic Protests

By J. Dana Stuster
Tuesday, June 5, 2018, 10:56 AM

Jordan’s King Sacks Prime Minister amid Economic Protests

Thousands of protesters have flooded the streets of Amman, Jordan, in recent days to oppose rising prices and structural adjustment reforms. The protests started last Wednesday with a labor strike, and have continued with street protests each evening since. The demonstrations are a direct response to increases in taxes and the price of fuel and electricity, which are subsidized by the government, but also reflect a broader frustration with the country’s economic straits. Prices have risen sharply in recent years as the economy has stagnated, and reduced aid flows from the Gulf have made the country’s welfare system difficult to maintain. In 2016, the IMF granted Jordan a $723-million line of credit on the condition that the country undertake structural adjustments, including reduced subsidies and increased taxes like those included in the legislation that prompted the current protests. But the latest price hikes are just the latest in a sequence that has already seen the price of bread double and a 16-percent sales tax tacked on to many consumer goods earlier this year. The cost of the reforms are building up too quickly for the population.

King Abdullah responded last Friday by freezing the implementation of the price hikes on fuel and electricity; other aspects of the policy that do not affect the majority of the population, including an expansion of the income tax base and increased corporate taxes, remain in place. After that failed to quell protests over the weekend, Abdullah requested the resignation of Prime Minister Hani Mulki on Monday and replaced him with Omar al-Razzaz, a former World Bank economist who had been serving as the Jordanian minister of education. Protests continued last night, despite the king’s decision to sack the prime minister.

Jordan has run high budget deficits and racked up a cumbersome national debt for years, but has gotten by with the help of its friends in the Gulf. Generous aid from Saudi Arabia has dried up in recent years, though; this is at least partly attributable to the Saudis’ reevaluation of its spending as oil prices dropped, but Jordanians also point to political tensions between the monarchies. Jordan has bucked Saudi pressure to drop its condition that Jerusalem be the capital of a Palestinian state in any two-state solution, and has maintained diplomatic ties with Qatar amid the Gulf-led campaign to isolate the emirate. That has pushed Amman to turn to the IMF, and accept the conditions for aid that the organization sets. Even with the structural adjustments and expanded domestic revenues created by the IMF-backed reforms, Jordan still needs to find ways to rein in discretionary expenses, like military spending, if it is going to escape its fiscal crisis, Kirk Sowell wrote recently for Sada.

The government is in a difficult position, but so are Jordanians. The New York Times notes a staggering fact: “Amman, the capital, ranks as the most expensive city in the Arab world, and it has a higher cost of living than much wealthier cities, like Dubai, London and Washington.” That is only getting worse as the government lifts subsidies on commercial goods. The unemployment rate exceeds 18 percent, and the government’s plans to create jobs require large amounts of foreign direct investment that have not materialized. Though the protests don’t seem to be near threatening the monarchy, it is remarkable that, in a country hosting more than 650,000 refugees from the Syrian civil war, Jordanians are desperate enough to take to the streets and chant, “Hear us now. We came to say you have left us with nothing. We are broke. The people want the downfall of the government.”

The Gulf Crisis, One Year In

Late last May, Saudi Arabia and the United Arab Emirates precipitated a crisis with Qatar. It started when hackers (likely a Russian outfit freelancing for the United Arab Emirates, according to U.S. intelligence) posted a fake news story on a Qatari website attributing provocative comments to the country’s emir. By the time the hack was revealed, the crisis had started: The Gulf bloc had seized the comments as a pretense and initiated a campaign to isolate Doha politically and economically. In the past year, threats of regime change and ultimatums have mostly given way to an expensive public-relations battle waged in conferences, think-tank events, ad space, social media, and editorial pages. This is the new status quo of Gulf politics.

The threats still come up. Last week, Saudi officials reportedly told French diplomats that it could attack Qatar if the Qatari government moved forward with a deal to acquire Russia’s S-400 air-defense system, according to Le Monde. It’s almost certainly a bluff, but demonstrates Riyadh’s concern about Qatar’s efforts to strengthen its ties with Russia and invest in its defenses. Qatar signed a military cooperation agreement with Russia last October, and Russian politician Aleksei Kondratyev said on Saturday that Moscow plans on proceeding with the sale of the S-400 surface-to-air missiles regardless of Saudi opposition.

Though Saudi Arabia and the Emirates started the feud to try to bring Qatar’s independent foreign policy to heel, it appears to have backfired diplomatically. Rather than isolate Qatar, it has pushed it closer to other countries that stand to profit from a divided Gulf, including Iran, Turkey, and Russia. In April, the tensions created by the feud reached a breaking point in the Emirates’ once-close relationship with Somalia, and a new report from International Crisis Group warns that the rivalry is promoting factionalism that could unravel the small measure of stability in the country. Still, Riyadh refuses to walk back its position, and Saudi media even reported recently that the government was mulling the particularly vindictive measure of dredging a moat along Qatar’s southern border and filling it with nuclear waste. Kuwaiti efforts to negotiate a resolution have fallen flat.

The United States’ response to the crisis among its Gulf partners has been a garbled, feckless mess. U.S. officials sent mixed signals for months, with then-Secretary of State Rex Tillerson calling for a speedy reconciliation and praising Qatar’s counterterrorism cooperation while President Trump openly supported Saudi Arabia’s efforts to pressure Doha in public remarks. Earlier this year, Trump began exploring ways to end the crisis, including plans for a summit at Camp David, but was rebuffed by Riyadh. Now, The National reports, U.S. officials have resigned themselves to the feud lasting for months to come. Plans for a U.S.-brokered meeting have been postponed to at least September. The pointless, petty squabble will continue at least until then, and likely much longer.

How Do You Solve a Problem Like Manbij?

The United States and Turkey have always had conflicting preferences regarding the role Kurdish forces should play in eastern Syria, and those differences have come into sharp relief since Turkey’s crossborder intervention, which began in August 2016. The United States and Turkey have at times even seemed to have different impressions of their own diplomatic talks on the subject—like when Turkish officials claimed last November that President Trump had agreed to stop arming Kurdish groups, which was later walked back by Pentagon officials.

Tensions have concentrated on the flashpoint city of Manbij, where U.S.-backed Kurdish forces with the Syrian Democratic Forces coalition, U.S. troops, Turkish troops, and Free Syrian Army rebels are all dug in within a mile of each other. “Officially the Americans and the Turks are NATO allies, but not in Dadat [a town just north of Manbij], where the mortars in the garden of the American compound were pointed in the direction of Turkey’s army,” the New York Times reports. U.S. forces have tried to reassure their Kurdish partners; the Times spoke with Kurdish leaders who had been told not to worry about headlines predicting an imminent withdrawal of U.S. support for Kurdish forces in the area.

The United States and Turkey were reportedly close to reaching an arrangement for Manbij in March, but it was delayed by the firing of Secretary of State Rex Tillerson. Turkish officials are in Washington this week to pick up where they left off with Tillerson, and on Monday Secretary of State Mike Pompeo and Turkish Foreign Minister Mevlut Cavusoglu agreed to a “roadmap” for the city. Though the details of the plan were not made public, Kurdish units announced today that they would fall back from the city and U.S. and Turkish officials confirmed that the withdrawal was part of the terms of the agreement. But differences remain: U.S. and Turkish officials disagreed about whether a timetable had been set, and Turkish officials claimed that Kurdish forces would be disarmed as they left their positions.

Now the question is whether Turkish forces will continue to press farther east. In a campaign speech last month, President Recep Tayyip Erdogan promised to “add new operations to the Euphrates Shield and Olive Branch operations” and to continue the intervention in Syria “until not one terrorist is left,” referring to Kurdish groups Turkey says are tied to the PKK. With the Manbij front frozen in recent months, Turkey has focused on containing the Kurds’ eastern flank in northern Iraq. Turkish forces have built forward operating bases near the Qandil Mountains, a PKK redoubt, and yesterday Turkey’s interior minister, Suleyman Soylu, said that troops are preparing for an offensive. "Qandil is not a distant target for us any more. Right now, a lot of positions have been seized there (by Turkish forces), especially in the northern Iraq region," he said in an interview. "Timing is what is important for us right now."