The economics behind conflict in MENA

The conflicts in Iraq, Libya, Syria and Yemen have killed hundreds of thousands of people and displaced millions. In seeking to explain the violence that has struck the Middle East and North Africa (MENA) over the past two decades, analysis to date has focused predominantly on ideological and identity-based factors. This report expands this discourse by incorporating approaches adopted from the literature on the political economy of war to examine the conflict economies of Iraq, Libya, Syria and Yemen.

Economic motivations, at the individual and group level, are key to understanding the wars in these countries, yet have tended to be overlooked in the MENA context. (As the wars have progressed and evolved, the national and local economies in which conflict is embedded have also changed.) Such motivations can offer an alternative or complementary explanation for armed group membership and armed group behaviour. While some groups will fight to promote or defend a particular identity, others fight for economic survival or enrichment. For many more actors, these motivations are tied together, and separating out ‘greed’ and ‘grievance’ is a difficult, if not impossible, task. Even if economic motivations did not spark the wars in Iraq, Libya, Syria and Yemen initially, it is clear that such factors now play a critical role in the persistence of open fighting, localized violence and coercion.

The objectives of this report are twofold. First, it seeks to develop a framework for comparative analysis of conflict economies at the local level in the MENA region. Traditionally, the idea of a conflict economy has been tightly linked to the funding for arms, ammunition and fighters. Further, most analyses of conflict economies are conducted at the national level. Even where research is conducted on a regional basis, discussion of the impact of conflict is brought back to the national level. In contrast, we see a broader political economy of war at work in the region. Our analysis illustrates how a conflict economy is embedded within a complex local socio-political system, in which many variables and agendas interact. We deliberately avoid characterizing conflict economies in terms of ‘black’ and ‘grey’ markets that somehow need to be ‘cleaned up’, as this erroneously implies that they can eventually be converted into licit markets like their peacetime counterparts. A more nuanced and multifaceted reading is essential. For the purposes of this report, we define a conflict economy as a system of producing, mobilizing and allocating resources to sustain competitive and embedded violence, both directly and indirectly.

Second, we show that a ‘political economy of war’ framing offers new approaches for reducing competitive and embedded violence. ‘Competitive violence’ can be defined as violence ‘deployed by warring elites to contest or defend the existing distribution of power’. Fighting between rival armed groups for control over resources and rents, among other things, usually falls into this category. ‘Embedded violence’, in contrast, underpins ‘how a political settlement works, as the deals agreed between elites may revolve around who has the “right” to use violence’. In practice, this could mean that one group is ‘permitted’ to use violence against another group – and no punishment will be enforced. In the context of this study, the use of armed force to assert the status quo to limit the number of ruling elite members is one example of embedded violence.