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World outlooks in 2021
Published in Ahram Online on 05 - 01 - 2021

2020 has not been, by all accounts, an ordinary year in human history. There were no global, regional or economic disasters. There was no cold war that made the international order descend into chaos. To the whole world's great surprise, it was a tiny virus that caused a major health crisis that hit the entire world without exception.
This tiny virus did not differentiate between developed and underdeveloped countries, rich or poor, right or left. The coronavirus was not just a pandemic that took all the world's countries by storm; it was also a test of these countries' political systems, at the top of which the US system, whose latest elections, which took place during the crisis, proclaimed Joe Biden as the country's new president.
With the advent of a new US president who is more open to dealing with the world as a whole and not as divided parts, and with the advent of new vaccines for the coronavirus, the world could finally heave a sigh of relief in 2021.
A recent publication, Outlooks 2021, presents a vision for the world, the Middle East and Egypt that is based on moving on from the crisis itself to the aftermath of the crisis and how the world will deal with the health, economic and social repercussions of the virus. The mission of dealing with these repercussions will not be easy, and it will be difficult on both the global and the regional levels.
In Egypt, success in this field means opening many doors to the resumption of progress and growth, and dealing with the regional issues so as to reach stability again.
First, world outlooks:
THE PANDEMIC: Since the beginning of 2020, the coronavirus has deeply influenced the behaviour of countries across the world and international relations, as they have disregarded and postponed any issues that do not mainly relate to facing up to the crisis.
As of 7 December 2020, the total number of cases of Covid-19 in the world had reached more than 67 million, with more than 1.54 million deaths. So, in the immediate sense, this layered crisis' greatest threat was to human life.
On the economic level, the pandemic caused the withdrawal of masses of people from labour and production services. It also led to the closure of some areas and the isolation of others. It led to the shutting down of means of transportation. On the social level, it negatively affected large segments of the population, who either lost their jobs or had to live with reduced incomes.
It also put citizens face to face with difficult choices, some of which were spiritual, bringing about a kind of internal peace, while others had material consequences, especially in terms of losing loved ones or living in poor conditions.
This crisis has been, and still is, ambiguous. Scientists from all over the world are in a dilemma trying to uncover the nature of this mysterious virus. To deal with this crisis, “coexisting” with the disease has become a world trend. However, for humanity, the first dilemma to be addressed is the time factor and people's impatience to return to a “normal” state of living.
Searching for a vaccine against the pandemic has gained unprecedented intensity in medical research, as this would have enormous ramifying effects on public health, the global economy and public policies. Governments, companies and academic laboratories have accelerated their efforts amid geopolitical competition and the challenges of producing sufficient doses for billions of people. Only after solving the underlying scientific mystery of the coronavirus can the pandemic be ended in 2021.
The pharmaceutical companies Pfizer and Moderna have separately released preliminary data indicating that their vaccines are more than 90 per cent effective, more than scientists had predicted. So, it has become evident that vaccines will be the way out.
However, the distribution of vaccines to billions of people all over the world fairly and smoothly poses a huge political and logistical challenge, especially as it will begin during a bitter transfer of power in Washington. The creation of a vaccine could also be an important reason to reach a new kind of human modesty, as humanity could still be threatened by the virus again, in cases of new mutations, for example.
THE US PRESIDENTIAL ELECTIONS: During 2020, both outgoing US president Donald Trump and President-elect Joe Biden won in the primary elections of their respective political parties.
Facing three consecutive crises (the coronavirus, the subsequent economic collapse and the demonstrations against US police for killing black Americans), Trump had a very good chance to unite all Americans from all political currents; however, he refused all good advice from his counsellors, mocked those who dared to differ, and persisted with his divisive policies.
The 2020 US presidential elections saw a record voter turnout, with the participation rate reaching 70 per cent. Joe Biden won more than 77 million votes, while his competitor Donald Trump received more than 72 million, eight million more than in the previous elections in 2016. However, Trump refused to admit defeat, claiming his loss was the result of “massive fraud.”
Following President-elect Joe Biden's assumption of office in January 2021, he is expected to quickly work to adopt new policies that will move the United States away from Trump's path, particularly with regard to immigration and foreign policy.
Biden has developed strategies to address the coronavirus crisis, from providing a vaccine to crisis-recovery aid. He also plans to immediately bring the United States back into the Paris Agreement on climate change and the World Health Organisation. He also seeks to organise a “global climate action summit” to help countries with high carbon emissions take climate action.
Biden may also end what his aides have described as “Trump's artificial trade war” with European countries, and he is likely to continue Obama's and Trump's efforts to reduce – if not end – the US military presence in Iraq and Afghanistan.
But unlike Trump, Biden tends to coordinate more closely with European and other NATO members when it comes to decisions about troop deployments. Biden has pledged to rally a summit of world democracies in 2021. This focus on pluralism by Biden will represent a big change from Trump's views on international cooperation.
THE US AND CHINA: The way Trump acted towards China was unprecedented for any US president. This time, the challenge was not China's closure, but its openness to the world, and its subsequent entry into the World Trade Organisation.
China has been categorised as a third world country, and the preferential privileges and transactions that international agreements provide resulted in an epic surplus in international trade for China.
Since 2003, China has been running a $500 billion trade surplus with the US. China also achieved $1.8 trillion in financial reserves, which is more than the US.
In December 2019, Trump concluded the China Trade Deal, incentivising US investments in China to return to the US, or at least to expand in the US and not abroad.
In 2021, the pattern of interactions between the US and China seems to indicate their rivalry. There could be a shift from competition to a trade and strategic war in the South China Sea, or a political war by imposing US sanctions on China's allies, such as North Korea and Iran. In this way, Washington would be pressing world countries to choose between the US and China.
So, competition seems to be about trade, but it is, at its core, a strategic competition about influence and dominance in the world.
In addition, the key aspects of the US foreign and national security policy towards China may remain as they are in 2021. This might include a more hostile attitude towards China and a more sceptical view of trade deals.
Biden knows that launching an ideological Cold War against Beijing will not persuade China to change its domestic policies. Therefore, it is likely that he will alert the allies that Washington will need support from by using a smarter competitive strategy that keeps communication channels open by working with China on issues where interests overlap (such as on climate change and global health).
Biden
Second, Middle East outlooks:
During 2020, the Middle East was a turbulent region of ongoing conflicts, popular protests, regional alliances, rocket launches, maritime exploration and conflicting international and regional races and interests.
THE NEW WAVE OF THE ARAB SPRING: Ten years ago, the first “Arab Spring” in Tunisia spread to Egypt, Bahrain, Libya, Syria and Yemen. A second wave appeared in 2019 in Algeria, Sudan, Lebanon and Iraq, relying on the same practices of the regimes in the first wave.
In 2020, the interactions of this wave continued within these countries in search of a peaceful way to stability. In 2021, relative stability is expected to occur in the second-wave countries of the Arab Spring.
In Sudan, the government will intensify its efforts at the local, regional and international levels, and take new steps towards establishing stability and closing the issues of rebellion and conflict. Sudan is expected to seek to launch a new stage with a focus on political stability and peace and development after all obstacles and restrictions imposed on it are lifted.
Algeria may see relative stability in 2021, with the country not sliding into chaos or even sliding towards a Syrian scenario as a result of applying a new constitution approved by a majority of the Algerian population last year.
The decline in demand for fossil fuels, Algeria's main financial resource, by about 98 per cent, and the drop in crude oil prices have damaged the Algerian economy. In 2021, Algeria will see four per cent growth in its economy, after a 4.6 per cent decline in 2020.
In 2021, Prime Minister Mustafa Al-Kadhemi's government in Iraq will be able to turn most of the challenges and crises in the country into real opportunities to reform the political process, especially as the political environment has become more receptive.
The Iraqi prime minister could succeed in establishing balanced relations with both the United States and Iran, as the two sides are not expected to withdraw from Iraq. The government is likely to change the election law so that Iraq can recover and reach a balance. Iraqi industry will return, and it will be relied on as an alternative to oil.
Al-Kadhemi's government may also succeed in achieving the required national demands and benefits, which is the real beginning of reforming the political process and correcting the path of Iraqi democracy.
In Lebanon, there are two scenarios in 2021. The first is that it will continue with the sectarian system and adjust it to fit with prevailing power dynamics. The second is that the Lebanese people will become convinced that the sectarian system no longer matches the aspirations of the new Lebanese generations, and thus will move towards the establishment of a civil state.
As a result of current international pressures, Lebanon is expected to hold a conference on forming a new regime, not a new government, that all political parties in Lebanon can accept.
The US presidential elections 2020
CALMING REGIONAL CONFLICTS: During 2020, the Middle East was able to deal well with a number of issues in the region, following the instability that has plagued many of its countries, and it has been moving towards calming the situation in many areas.
On 6 June 2020, Egypt put forward a new initiative to resolve the Libyan crisis called the “Cairo Declaration” with head of the Libyan National Army (LNA) Field-Marshal Khalifa Haftar and the Libyan Parliament Speaker Aguila Saleh. In October 2020, a lasting ceasefire was declared, and a round of political negotiations between the two Libyan factions was resumed.
The future of Libya in 2021 is expected to see the establishment of an executive authority capable of organising elections, implementing the political, economic and military reforms needed to restore the normal life of Libyans, designing a comprehensive roadmap for the political process, and developing a national pact based on the principles of accountability, justice, human rights and a firm commitment to a civilian state.
Parliamentary and presidential elections are also expected to be held on 24 December 2021 in Libya, following the agreement of the members of the Libyan Political Dialogue Forum. In addition, the International Energy Agency has linked its estimates of the improvement in the international oil market in 2021 to the return of Libyan oil production, which increases optimism for next year.
In 2021, Syria is expected to see gradual stability returning, especially after a truce was reached between Washington and Moscow in mid-September 2020 and approved by Syrian President Bashar Al-Assad. However, another scenario holds that President Al-Assad's assertion that he is determined to restore Syrian territory and that he retains the right to respond to all terrorist attacks could once again inflame the conflict.
Damascus is expected to maintain the autonomous status of the Syrian Kurds. As part of the regime's counter-insurgency strategy, it is expected in 2021 to seek to maintain the continuity of operations by state institutions in areas under opposition control.
According to Syria's 2012 Constitution, the Syrian regime may seek to hold presidential elections in 2021, in which President Al-Assad will be the strongest candidate.
Xi Jinping
PEACE TRENDS IN THE REGION: In 2020, Israel signed historic diplomatic agreements with two Gulf Arab states, the United Arab Emirates and Bahrain, at a White House ceremony.
The bilateral agreements formalise the normalisation of relations between Israel, the United Arab Emirates and Bahrain, which are in line with their common opposition to Iran. The three countries signed a document called the “Abraham Agreements.”
The document consists of general statements pledging to promote diplomacy, mutual cooperation and regional peace. The three parties agreed on bilateral deals in 15 common areas: finance, trade, aviation, energy, communications, health, agriculture and water. A few days later, Sudan and then later Morocco also agreed to normalise relations with Israel.
Israel and the United States hope that these agreements will lead to a big change in the region if other Arab countries, especially Saudi Arabia, follow suit.
In 2021, many analysts, for reasons related to the Iranian threat to the security of the Gulf States, expect to see reinvigorated relations with Israel through peace, normalisation, and security, political, and economic agreements.
Saudi Arabia may reconsider the normalisation of relations with Israel. Riyadh quietly endorsed the deals of the United Arab Emirates and Bahrain; however, it did not ratify them, indicating that it is not ready to take action itself.
If Saudi Arabia joins the UAE, Bahrain, Sudan and Morocco in normalising relations with Israel, it can expect more US weapons to be made available.
Bashar Al-Assad
THE PALESTINIAN CAUSE: The US administration led by Trump radically shifted from the traditional role of the United States, promoting only Israel's interests.
Trump transferred the US embassy in Israel to Jerusalem, cut off funding for the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), and modified the previously firm US stance that Israeli settlements in the West Bank are against international law.
The Palestinian leadership refused to participate in the economic conference in 2019, which was run by the Trump administration under the auspices of the so-called Middle East peace plan. This gave the green light to Israel's annexation of areas of the Occupied Palestinian Territories.
Palestinian leaders have denounced the normalisation agreements between Israel, the United Arab Emirates, Bahrain and, most recently, Sudan and Morocco. Palestinian President Mahmoud Abbas described these moves as “a stab in the back.”
In 2021, there are two scenarios for the future of the Palestinian cause. The first will be the protection of the Palestinian national project by the Palestinian leadership and the continuation of the call for a two-state solution. The return of US-Palestinian relations could be a bridge for the Palestinian National Authority to re-negotiate with Israel.
Biden has already pledged to return US aid to the Palestinians. With the US Embassy now in Jerusalem, Biden will reopen the US Consulate in East Jerusalem and the office of the Palestine Liberation Organisation (PLO) mission in Washington.
Third, Egypt outlooks:
Mohamed bin Zayed
THE DOMESTIC SITUATION in Egypt was not radically different from that in other countries that experienced the coronavirus crisis in 2020. Fortunately, the pandemic took place at a time when there was noticeable progress not only in health capabilities, which are much better than before, but also at a time when the Egyptian state's ability to exert control is much greater than in the past.
The economic crisis that came in the wake of the pandemic not only affected Egypt, but also the world economic system, and this has affected the country in many matters related to trade, tourism, traffic, the Suez Canal, oil prices and the remittances from Egyptian workers abroad.
One of the positive impacts of the coronavirus was rationalising work at state organisations and in the private sector by working at home and via the Internet (which around 54 million Egyptians can do). This resulted in reductions in traffic congestion and pressure on public utilities.
The pandemic took place at a time when there was a surplus in financial and economic reserves. It also came at a time when the Egyptian Armed Forces had the ability to maintain the public's sense of reassurance and psychosocial balance amid unprecedented living conditions. Money, food and other rationed materials were provided in adequate supply.
The crisis exposed the potential and capabilities of the Egyptian health sector, which heroically confronted the pandemic in the same manner that the police and the armed forces heroically face terrorism. The greatest opportunity for the health sector is that it has the size and capacity to make a major Egyptian health industry possible.
In 2021, the health sector may experience significant development not only as a service, but also as a multifaceted industry. Similarly, the trend towards supporting the digital sector in the country has not only succeeded in education, but has also created solutions to deal with difficult crises in the labour economy, health service and the distribution of salaries to irregular workers.
A range of actions are expected to be taken in 2021, such as human capacity-building, the digital transformation of government services, the implementation of health policies and precautionary measures to reduce the expected rise in infection rates over the next period.
The economy is expected to grow by between 2.8 per cent and four per cent in fiscal year 2021/2022.
In 2021, Egypt will also witness a continuation of the ongoing development process with higher growth rates in the Suez Canal and Sinai, especially in the fields of industry, agriculture, logistics and services, and the development of the Red Sea region, and coordinating and deepening cooperation with similar economic activities taking place on the Saudi side.
The Senate and the Parliament are set to play their role in enriching parliamentary life following the completion of their election procedures.
The Senate (the second chamber of parliament) is expected to add quality to many legislative debates in the Parliament in 2021, ensure increased community representation through its members – thereby expanding the space for participation – listen to the widest range of views on various societal issues, and finally build a representative system that ensures a better balance in the exercise of power and control, leading to the success of the legislative branch by working in a quiet and balanced atmosphere.
Benjamin Netanyahu
ABROAD: Egypt's regional role is focused on the need to integrate with the internal construction process of the country. It also relies on the fact that conflicts are taking place in nearby maritime and land zones, reflecting the geopolitical significance of Egypt.
The Egyptian role relies on protecting vital Egyptian interests, such as Egypt's share of the Nile water, combatting terrorism in all its forms at home and abroad and achieving stability in the regions adjacent to Egypt after a decade of instability, civil wars, division and violence.
THE CHALLENGES OF THE EASTERN MEDITERRANEAN: The political, economic and strategic environment in the Middle East has changed, especially as Egypt has planned the demarcation of its maritime boundaries in accordance with the United Nations Convention on the Law of the Sea with Saudi Arabia in the Red Sea and Cyprus and Greece in the Mediterranean Sea.
These agreements have contributed to the formation of exclusive economic zones for these countries, after which major discoveries of natural gas could be made in Cyprus, Egypt, Israel, Palestine and Lebanon. These countries also share a number of special advantages due to their prestigious geopolitical and economic location due to the Suez Canal.
These developments have resulted in three competing trends within the Eastern Mediterranean.
First is the Egyptian initiative to establish the Eastern Mediterranean Gas Forum, which is composed of Egypt, Israel, Palestine, Jordan, Cyprus, Greece and Italy. All these countries either have gas resources, while two countries, Jordan and Italy, are high-use countries.
Egypt reinforced this forum by signing commercial deals for gas transportation, liquefaction, export and use with Israel and Cyprus. After the forum was established, Egypt began to explore the demarcation of its maritime border with Palestine in the Gaza Strip. At the same time, Israel negotiated with Lebanon the demarcation of the maritime border between the two countries.
Second, Turkey signed an agreement with the Libyan Government of National Accord to plan the demarcation of the maritime border between Ankara and Tripoli in November 2019, despite the fact that there are no maritime borders between Libya and Turkey.
Furthermore, Turkey began to explore for gas but did not find it near its shores. Then, it explored for gas on the Turkish-Cypriot maritime border, pressuring Greece in order to have a share of distributing gas production and revenues and without signing the United Nations Convention on the Law of the Sea.
Third, Egypt has resolutely dealt with the Libyan crisis, gradually pushing Turkey away from Libyan territory. Greece has also skillfully used its European friends to form an anti-Turkish alliance, which has led to a Turkish retreat.
In general, Egypt has achieved remarkable political, strategic and economic successes in all these developments. Turkey has been relatively neutralised, the Palestinian and Israeli sides have been brought together in the Eastern Mediterranean Gas Forum, Egyptian gains from gas exploitation have been maximised, huge amounts of gas have been made available to Egypt's developing industry and Egypt's fields of operation and needs for additional energy sources have been increased.
Regarding the scenarios expected in 2021, Egypt is expected to create a regional system in which it becomes a central economic, political and strategic hub linking the Eastern Mediterranean and the Red Sea, based on peace and cooperative development.
On the other hand, Egypt is expected to link the state of peace and cooperation currently taking place in the Gulf countries with the Egyptian-Israeli Peace Treaty of 1979.
Egypt will also encourage the demarcation of all maritime borders in the region, especially between Egypt and Palestine, Palestine and Israel, Israel and Lebanon, and Egypt and Israel. Egypt will also activate the Eastern Mediterranean Gas Forum, especially in exploratory and industrial activities, and launch another gas liquefaction plant in Al-Ain Al-Sokhna or Suez, in order to export the forum's gas to Africa and Europe.
The most important trend of 2021 could be to institutionalise the Eastern Mediterranean Organisation, particularly with regard to membership rules, so that it becomes a regional institution.
THE GRAND ETHIOPIAN RENAISSANCE DAM (GERD): On 6 November 2019, the United States invited Egypt, Ethiopia and Sudan for discussions in Washington, and the three agreed in a meeting attended by US Treasury Secretary Steven Mnuchin and President of the World Bank Group David Malbas to hold four technical meetings on the dam.
After arduous negotiations under the auspices of the US and the World Bank, a structure for agreement was reached on all the key issues of negotiation among the three countries. The US wording presented to the last negotiation round was satisfactory to Egypt, which initialled the agreement, while Ethiopia did not attend.
In June 2020, the tripartite negotiations between Ethiopia, Egypt and Sudan on the first filling and annual operation rules for the GERD continued via a video conference attended by observers. The two countries agreed to assess the outcome of the negotiations and continue negotiating outstanding issues.
Ethiopia said it had already achieved its first-year target for filling the reservoir of the dam, thanks to a heavy rainy season. For its part, the Egyptian Ministry of Irrigation said in a statement that Egypt and Sudan had expressed their fears regarding “unilateral filling” and that “the Ethiopian unilateral action of filling the dam overshadowed the meeting and raised multiple questions about the benefits of the current path of negotiations to reach a fair agreement on filling and operating the GERD.”
Regarding the future of the GERD in 2021, Ethiopia may accept the negotiations and change its position, driven by internal tensions in Tigray province.
With regard to US mediation, many analysts believe that this depends on the relationship of the political leadership in Egypt with the new US administration, which could seriously intervene in order to reach an agreement that satisfies the three parties, especially since the United States has major interests in the Middle East.
It is also likely that the Arab and Gulf States' support will continue, especially for Egypt's stance in the GERD negotiations.
Fourth, world scenarios:
The world may well pass through 2021 seeing several scenarios, the most important of which will be creating a vaccine for the coronavirus in large quantities. In this case, the focus will shift from developing the vaccine to the equally daunting task of its distribution. In addition, the economic recovery after the epidemic will also be incomplete.
The next president of the US to enter the White House, Joe Biden, will seek to reform the new world disorder, starting from the Paris Agreement and the Iranian nuclear deal. However, analysts see more tensions between the United States and China, especially as Biden wants to reform relations with US allies to make them more effective.
The pandemic has accelerated the adoption of technological advances such as video-conferencing, online shopping, telemedicine and distance learning. In 2021, it will become clear how these changes will continue.
Tourism will shrink, and its shape will change, with more emphasis being placed on domestic travel. Airlines, hotel chains and aircraft manufacturers will struggle. Universities that rely heavily on foreign students and cultural exchanges may also suffer.
An important aspect of the crisis in 2020 was the opportunity to take action on climate change, with governments investing in green recovery plans to create jobs and reduce emissions.
The writer is chairman of the board, CEO and director of the Regional Centre for Strategic Studies.
The article is the introduction of the Egyptian Centre for Strategic Studies (ECSS) annual report “Outlook 2021” to be published soon.

*A version of this article appears in print in the 7 January, 2021 edition of Al-Ahram Weekly.


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