32. ISRAEL'S FOREIGN currency reserves today are just short of $200 b., as opposed to 1987 when they were just $9.5 b. Merriam-Webster. Cairo is also facing intensifying water scarcity, and then, as a result, a food shortage ensues in Egypt and causes the price of basic foodstuffs to rise in nearby countries. Radical Islamic groups are viewed by growing numbers of the general public as attractive anti-regime alternatives. Third, to quote Shakespeare, there is nothing either good or bad but thinking makes it so. The complexity of thinking about the future is not only about how events will develop, but how those in the future will assess them. 33. It grew faster than the Eurozone average, as well as the US, Canada, and Australia. The reading beat market expectations and put the overall 2022 expansion at 6.4%. From the American perspective, putting too much emphasis on great power competition could backfire on its other important regional assets. How to Make Sense of Weak Signals. MIT Sloan Management Review. November 1, 2009. https://www.mckinsey.com/business-functions/strategy-and-corporate-fina. The key U.S. objectives in the Middle East are to prevent the emergence of a power vacuum that will be filled by Russia or China and to make sure that regional problems dont spill over. Also, there is a strong demand from Washington for Middle Eastern allies to demonstrate progress toward democratization. OECD. China increases its support for Egypt as a means to reduce Russian influence in the country and in Africa more broadly. Rather, we hope that reviewing how the futures of the past were perceived when compared with how they developed will be instructive in formulating clearer guidelines for how to think about the future. Doing so helps ensure against missing potentially important implications that the scenario developers can overlook if they are too close to the subject matter. The Israel Economy: The First Decade. For example, the NIC correctly noted that globalization could lead to the rise of populism and pointed to Latin America as the likely place for that to emerge. Israel reoccupies Gaza in one of those incidents and then withdraws after a year as part of a negotiated agreement that allows the PA to manage Gaza only to see Hamas retake control of the enclave after several months. Over the course of the decade, between 2020 and 2030, the U.S. places sporadic but severe pressure on Israel to respond affirmatively to new peace proposals regarding the Israeli-Palestinian conflict, requiring Jerusalem to make considerable concessions. Paul Rivlin. The scenarios are exploratory, rather than predictive or normative,20 meaning that they aim to answer the question of what can happen rather than what will or what should. The Middle Eastern regimes incompetent handling of the COVID-19 crisis along with worsening structural economic problems leads to a growing sense of frustration among the populations. In parallel, the U.S. encourages the regional actors to resolve their security challenges on their own, which has the added economic benefit of increasing weapons sales to regional states. Futures Thinking Methodologies Options Relevant For Schooling For Tomorrow. OECD. The newly crowned King Khaled seeks to change the kingdoms priorities by reducing its regional involvement and focusing the bulk of its resources on domestic modernization. Iran sets out to rebuild its nuclear program in heavily fortified underground sites and quickly reinforces Hezbollah capabilities, including the provision of additional stockpiles of precision weapons. Understanding Analytical Tools for Thinking About the Futures, IV. A broader Saudi-Iranian dtente is then mediated by the sultan of Oman. The great powers overtures to pressure Cairo to forfeit its nuclear weapon fail after Iran acquires a nuclear weapon in 2028 (apparently purchased from North Korea) and in 2029 when special security arrangements between Pakistan and Turkey are declared widely interpreted as Islamabad extending its nuclear umbrella to Ankara. It seems it might grow a bit slower than forecasted, but it'll still be pretty good. One of Washingtons key aims in the Middle East is limiting Chinese and (secondarily) Russian influence. Economic distress as a result of low oil prices leads to public unrest and violent repression of opposition voices throughout the region, especially in Algeria, Egypt, and Iraq. Meanwhile, Jonathan Katz, the chief economist at Leader Capital Markets, announced that there, Latest updates put the annual inflation to be. Professor Karnit Flug, the vice president of the Israel Democracy Institute and the former governor of the Bank of Israel, also supported Ben-Davids argument by stating that, With a growth rate of 8.1% in 2021, Israels economy is among the fastest growing advanced economies among OECD countries.. The aim of examining futures of the past is certainly not to point out what some might view as errors. In addition to jihadists, the primary targets of the surveillance by the security forces are Muslim Brotherhood affiliates and liberal human rights activists. Total American assistance to Israel, from its establishment in 1949 up to 2016, amounts to approximately $125 billion, a whopping sum, making Israel the largest beneficiary of American aid in. This leads to growing tensions between Russia and Turkey and rising American support for Ankara as a counterweight to Russian influence in the Middle East. There is a significant rise in demand from these Arab states for joint ventures with Israel on technology related to desalination and agriculture and this helps them to cope with climate change more successfully than many other states in the region that refuse cooperation with Israel. Also found in similar projects such as: https://www.atlanticcouncil.org/wp-content/uploads/2014/08/ME2020.pdf. Yoel Guzansky. In addition, greater internal stability could make key actors in the Middle East more assertive toward Israel. September 2, 2020. https://www.csis.org/analysis/toward-more-proliferated-world. These concessions are granted in exchange for broadening Irans civilian nuclear program (construction of five reactors paid for by an international consortium) and the lifting of all sanctions. March 2, 2020. https://www.wita.org/atp-research/the-rules-based-multilateral-order-a-. However, it is worth noting that because these camps are composed of individual actors with interests that do not always entirely overlap with one another, hedging and limited inter-camp cooperation occur when interests dictate. The current state of scenario development: an overview of techniques. Foresight 9 (1). May 2009. https://jfsdigital.org/wp-content/uploads/2014/01/134-AE03.pdf. The rates of employment cannot continue to grow at this rate in the future due to the expected saturation in employment rates among the non-ultra-Orthodox Jewish population. In this scenario, reduced U.S. pressure on Iran does not eliminate the possibility of regime change, but the new regime may not enter the Western orbit or forfeit hegemonic and nuclear ambitions if doing so has not or cannot deliver considerable improvements in Iranians living conditions. For a listing of MEI donors, please clickhere. The trigger can be external, demographic, technological, ideological, or any other potential development capable of having a major impact if the weak signal were to become markedly stronger. d) Proliferation of Dangerous Technologies: The unraveling of arms control agreements increases the risk of nuclear proliferation,23 while the largely unregulated proliferation of precision-guided munitions has enabled the emergence of strategic non-nuclear threats in the region. One of the most serious challenges Israel has faced over its . However, it soon becomes apparent that the new government retains the ancien rgimes hegemonic ambitions. Connor Dilleen. Please note that the posts on The Blogs are contributed by third parties. After the price collapse in April 2020, petrostates will find themselves dependent on a volatile (at best) oil market that will prove the determining factor for whether or not they will be able to balance their annual budget. The poverty rate is projected to decline to 26.7% in 2022, and then to further gradually decrease to 26.1% by 2024. The opinions, facts and any media content in them are presented solely by the authors, and neither The Times of Israel nor its partners assume any responsibility for them. In the second half of the decade, Israel capitalizes on the relative weakness of Egypt and the Gulf states in order to expand cooperation with them. They are intended to highlight the reality that over the course of the next decade Israels strategic environment could undergo fundamental changes. Radical Islamic terror groups abound throughout the region, taking advantage of protracted conflicts in Libya, Yemen, Syria, and Iraq. No one can know the future, and it is misleading to pretend to.34 Or as the late political scientist Herman Kahn of the RAND Corporation put it succinctly, The most likely future isnt.35, Climate change will likely intensify water scarcity in an already water-poor region, bring food shortages, spur refugee crises, and possibly make some areas in the Arab Gulf uninhabitable by 2050.. Please try again or choose an option below. Friday, March 27, 2020 Only 7 percent of local energy production last year came from alternative sources, mainly solar, and Israel's future targets are modest compared to Europe's: The government is aiming for just 30 percent of all energy to come from renewables by the end of the decade. Rather, it is a landscape created through a combination of change and continuity, and so there is a high probability of departing from at least some currently dominant trends. Horizon scanning focuses on emergent issues that might gain strength in the future and lead to systemic change. He will likely seek to prioritize the Iranian and northern arenas over the Palestinian arenas - provided the domestic political situation allows him to do so. Changes in the dynamics of great power competition in the Middle East might bring about significant changes in the structure of regional camps, which will not necessarily prove helpful for advancing Israels core national security interests. . Israels involvement in the intra-Palestinian struggle arouses negative sentiments toward Israel in the Arab world in general, and in Saudi Arabia in particular, where the political and religious establishments were already at odds regarding modernization. While 1985's economic reforms did dramatically reduce inflation and stabilize. Following King Salmans passing in 2021, there is an attempted palace coup dtat in Saudi Arabia in which Crown Prince Mohammed bin Salman (MbS) is assassinated and the Iranians seize the opportunity to foment large-scale protests in the predominantly Shia eastern regions of the country. This was due to tighter restrictions imposed on the country's tourism industry following the coronavirus. The current realities worldwide and in the Middle East highlight the importance of preparing for the next decade in the region through the lens of scenarios rather than straightforward predictions. The first priority on the Israeli national security agenda is to prevent nuclearization by any Middle Eastern country. 12. Rafael Ramirez, Malobi Mukherjee, et al. His research focuses on U.S. foreign policy, the U.S.-Israel relationship, Israeli strategy vis--vis Iran, and the Yemeni civil war. The population has grown from 750,000 at independence to 9.3 million at end 2020, while gross domestic product (GDP) rose from $6.5 billion to $407 billion in 2020 (in 2020 prices and exchange rates). Plessner, Yakir. The Iranian-Arab faultline in the region revives Arab nationalism and efforts to increase economic, political, and military cooperation between Arab states. 23. Scenario development is one of the most popular methodologies to investigate the future, and various methods have been developed to build and map scenarios.3 The basic concept evolved from business practitioners, with the most famous method being the matrix introduced by Royal Dutch Shell and refined later in Global Business Network (GBN). There is some criticism about scenarios methods: there are many pitfalls in developing them,7 and the employment of different techniques can lead to diverging future constructs.8 The latter point is actually as much a benefit as a criticism, since the objective of scenario exercises is to stimulate thinking about a diverse range of possibilities. The global economic recovery lags because of setbacks in bringing an end to the COVID-19 health crisis. In 2028, the reformists lose the elections in Iran as their diplomatic endeavors failed to significantly improve the countrys economic situation. The use and abuse of scenarios. McKinsey & Company. Rising Temperatures, Rising Risks: Climate Change and Israels National Security. The Institute for National Security Studies. Therefore, it is difficult to imagine that the next decade will see significant progress in closing those gaps, and some of the worlds most fragile states that are situated in the Middle East might become further destabilized or involved in inter-state conflicts.28. The many points of contention between the great powers hinder their ability to prevent regional conflicts from erupting. Report: Bank officials believe $4 billion moved out of Israel in recent weeks. The COVID-19 crisis strains the already tenuous ability to develop long-term predictions, as even deciphering the present reality remains a challenge and basic assumptions regarding the factors shaping the future have been called into question. Future Potential of the Israel Economy Whether you're looking for a great investment market or trying to better understand local economies, you should keep your eye on the Israel economy. 5. Michael Singh. The decline in energy revenues forces the Gulf states to reduce their economic support to the poorer Arab states, in particular Egypt. What we determined as the most important and persistent trends to consider, which appear poised to influence the Middle East over the next decade, are: a) The Decline of Unipolarity: The results of this ongoing global transition from unipolarity to a bipolar (U.S.-China) or multipolar (U.S.-China-Russia) world will include: growing challenges to the existing international system;21 intensification of great power competition and its projection into the MENA region;22 U.S. efforts to reduce its military footprint in the Middle East in favor of the Pivot to Asia; an expanded Chinese footprint around the globe (mainly through commerce and infrastructure projects); and Russian attempts to reestablish itself as a powerbroker in the region. Mapping the Global Future,12 which was published in 2004 as part of the 2020 Project by the U.S. National Intelligence Council (NIC), was used as a case study. The OECD suggests that, scenarios are tools created to have structured conversations and analysis of the challenges and opportunities that the future may bring.10 Kosow and Gassner explain that, scenarios have no claim to reality and therefore do not provide a true knowledge of the future; rather, they merely supply a hypothetical construct of possible futures on the basis of knowledge gained in the present and past a construct which includes, of course, probable, possible and desirable future developments.11. When the talks falter and then implode, the result is a major escalation of fighting between Israel and the Palestinians that then leads to the cutting of diplomatic ties between Israel and Arab states, including longstanding partners Egypt and Jordan. Making great power competition the primary prism of the U.S. policy in the region could destabilize its traditional alliances and put it in a position of disadvantage in that very competition.. The U.S. administration is committed to tackling Middle Eastern challenges through proactive diplomacy. Due to U.S. and UAE pressure, Israel assents to Mohammed Dahlans assumption of control over the Palestinian Authority (PA) after Mahmoud Abbass death in 2023. Itai Brun17 as helpful for thinking about possible futures, facilitating decisionmakers consideration of different ideas about policy, the exercise of power, and military buildup, and useful for governments seeking to prepare themselves for the future.18. The Israeli labour market is tight, with a low unemployment rate (3.9% in 2022) and employment above pre-crisis levels, so that the vacancy rate has stabilised at a historically high level towards the end of the year. This scenario depicts how making great power competition the primary prism of the U.S. policy in the region could destabilize its traditional alliances and put it in a position of disadvantage in that very competition. Nevertheless, scenarios are an indispensable and creative mechanism that produces what is known as interesting research 9 (that which is innovative and more likely to produce learning), broadens thinking about future possibilities, and helps to prevent group-think. The U.S. refrains from directly confronting Iran out of concern that it will be drawn into another decades-long quagmire. Tarik M. Yousef, Ranj Alaaldin, Geneive Abdo, Ali Fathollah-Nejad, Omar Rahman, Yasmina Abouzzohour, Galip Dalay, Nader Kabbani, Adel Abdel Ghafar, and Noha Aboueldahab Shira Efron. Reports show an 8.6% growth in 2021 when Israel was recovering from the COVID-19 pandemic but with inflation at an all time high, it is expected to hit 5.1% by the end of 2022. Overview of Methodologies. OECD. 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