Editor’s Note: As an economist, Nader Habibi brings an important perspective to Middle Eastern issues. He has written for Stimson on an eclectic range of topics that underline problems affecting the entire region and possibilities for positive change.
By Barbara Slavin, Distinguished Fellow, Middle East Perspectives
The Middle East and North Africa (MENA) region lags far behind many other parts of the world when it comes to trade, investment, and policy coordination. Yet these countries confront important challenges that could be addressed more effectively as a bloc.
Among them are the treatment of ethnic minorities, population demographics, and a two-state solution to the Israel-Palestine conflict.
Ethnic and Minority Rights
Fear of separatism and domestic instability has driven most Middle Eastern states to impose severe restrictions on the cultural and political rights of ethnic and religious minorities. These policies have led to relative underdevelopment and lower standards of living for some ethnic and religious minorities.
The most important example is the Kurds who live in Iran, Iraq, Syria, and Turkey. The four countries, despite confronting similar demands for political and cultural rights, have generally not coordinated their responses. Often, one country has supported the struggle of Kurdish groups against a neighbor. Turkey and Iran, for example, while suppressing their own Kurdish citizens, have accused each other of supporting Kurdish insurgencies in the other.
There have been occasional bilateral agreements, but these have been limited to security pacts against separatist Kurdish groups, without any focus on positive coordination for development and cultural rights. The latest example is the recent security agreement between Iraq and Turkey against the Kurdish Workers Party (PKK) presence in northern Iraq.
Given the persistence of Kurdish nationalism despite repression, an effort by all four countries to enhance the rights and living standards of Kurds could have many positive benefits.
Current policies date to the emergence of modern states in the Middle East after World War I when dominant ethnic groups – Turks, Persians, and Arabs – supported cultural homogenization as a requirement for state building, national unity, and territorial integrity. Consequently, they have looked with suspicion at the demands of any ethnic minority for cultural expression and self-governance.
The majority ethnic group in each country also fears that giving concessions to the Kurds could facilitate outside intervention. Iran and Turkey are very mindful of how external support for Kurds in Iraq and Syria during periods of state failure resulted in the creation of semi-autonomous Kurdish regions under external protection.
These four countries could partially overcome their fears if they negotiated a common code of minority rights and a mechanism for coordinated implementation. Iran, Iraq, and Turkey (and at a later stage a stable Syria) could agree that while all citizens must learn and use the national language, Kurds and other ethnicities enjoy the right to preserve their ethnic heritage.
They could set standards for Kurdish language media, participation in local and national government, and the removal of political, social, and economic discrimination at the national level. This would imply a fairer distribution of national resources, development funds, and government jobs, which would reduce the development and income gap of the Kurds relative to the national average.
If the approach was regional, it would be easier for the majority ethnic group in each country to accept the concessions, without worrying that they would be exploited by a neighbor to instigate instability and separatism.
Precedents for such measures can be found in Europe after World War II and again after the collapse of the Soviet Union. European countries at risk of ethnic unrest and civil war cooperated to support ethnic rights while resisting demands for secession and separatism.
Transition Toward Low Fertility
The Middle East has experienced a significant demographic transition from high growth rates in the 1960s and ‘70s to moderate rates after 1990. However, the situation now is uneven. Some countries that have experienced large declines, such as Iran and Turkey, are trying to reverse the trend, while Egypt, Algeria, Yemen, and Iraq are still experiencing high fertility rates and population growth rates that exceed one percent a year.
Ideally, the successful countries should continue their low fertility trajectories while encouraging MENA countries with relatively higher rates to lower them.
The total population of the region was 106 million in 1960 and reached 256.2 million by 1990, according to World Bank data. The successful family planning policies in many MENA countries, and the rising level of education among women, reduced fertility rates. By 2020 the total population stood at 479.96 million (estimated at 500 million in 2024). If rates had not declined, the figure would have been near 600 million.
In Iran and Turkey, fertility rates have dropped to 1.5 to 1.6 children per woman, below the 2.1 births required for a stable population. This decline is also visible in wealthier Arab countries such as Kuwait and the United Arab Emirates. Some governments that celebrated the decline in the 1990s and 2000s are now raising alarms. In a significant policy reversal, Iran and Turkey are offering incentives to encourage households to have more children.
MENA governments are concerned about the declining share of working-age people relative to the retired and elderly population in coming decades. Some countries also view a large population as contributing to military and economic strength and fear they will be disadvantaged by the relative size of their populations compared to other Middle Eastern countries.
Some governments focus on the fertility differential among ethnic groups. In Israel, for example, Jews and Palestinians have been involved in a demographic war alongside multiple other clashes.
Since many MENA countries, and the region as a whole (with the exception of oil-rich GCC states) suffer from high youth unemployment, low per capita income, and weak industrial activity, there is no advantage to high population growth. Moderate fertility rates in the range of 1.8 to 2.1, which result in a graduate decline or stable population levels, would be preferable. If through regional coordination, MENA countries with higher rates commit to putting more effort into reducing population growth, the countries that have achieved lower fertility rates might feel less compelled to reverse their population policies. A stable or declining population will raise short-term challenges but help future generations enjoy more prosperity.
Regional Coordination Toward A Two-State Solution
While there are many disagreements and rivalries among Middle Eastern leaders, they all say they support Palestinian aspirations for statehood. However, individual countries have followed differing and often contradictory and counterproductive strategies.
On one side, Iran and its regional allies known as the Axis of Resistance are engaged in military confrontation with Israel. Since the Hamas attack on Israel last October 7, this confrontation has threatened to escalate into a regional war drawing in multiple local and external powers.
On the other side are the MENA countries that have recognized Israel, such as Egypt, Turkey, Jordan, and Morocco, the UAE and Bahrain, and countries flirting with such recognition, such as Saudi Arabia. These countries in general do not support Hamas or other actors that engage in armed resistance. Instead, they offer economic support to Palestinians and engage in diplomatic negotiations with Israel and the United States in support of the Palestinian cause.
After more than 80 years of Palestinian struggle and countless lives lost, neither side has been successful.
Despite some reduction of tensions among MENA countries over the past two years, they have not achieved coordination in their Palestine policies. Iran is still strongly opposed to the participation of some Arab countries in the Abraham Accords. Saudi Arabia, Jordan, and the UAE, in turn, oppose Iran’s support for Arab proxies and accuse Tehran of destabilizing the region and interfering in Arab affairs.
There is some evidence that the prospects for diplomatic cooperation among Middle Eastern countries have improved since the start of the Gaza war. Iran, for example, has signed off on several communiques calling for a two-state solution. If despite their differences and regional rivalries, the Middle Eastern countries could agree on a unified and coordinated policy toward the Palestinian crisis, they would be more effective. Such coordination requires realism and a willingness to compromise. Iran and the Axis of Resistance, for example, must accept that Israel enjoys full U.S. support and cannot be defeated militarily.
Similarly, the Abraham Accords bloc must accept that decades of negotiations and friendly lobbying in Washington have not secured a homeland for the Palestinians.
A coordinated posture by the Arabs, Iran, and Turkey that offers a collective regional normalization of relations with Israel conditional on Israeli acceptance of two states and a consequent termination of all military activities against Israel, would create a more effective negotiating partner for the U.S. and Israel. It would also increase the likelihood of success for supporters of Palestinian sovereignty and independence.
Nader Habibi is an Iranian American economist and Henry J. Leir Professor of Practice in the Economics of the Middle East at Brandeis University.
MENA Cooperation Could Bring Important Benefits on Three Key Issues
By Nader Habibi
Middle East & North Africa
Editor’s Note: As an economist, Nader Habibi brings an important perspective to Middle Eastern issues. He has written for Stimson on an eclectic range of topics that underline problems affecting the entire region and possibilities for positive change.
By Barbara Slavin, Distinguished Fellow, Middle East Perspectives
The Middle East and North Africa (MENA) region lags far behind many other parts of the world when it comes to trade, investment, and policy coordination. Yet these countries confront important challenges that could be addressed more effectively as a bloc.
Among them are the treatment of ethnic minorities, population demographics, and a two-state solution to the Israel-Palestine conflict.
Ethnic and Minority Rights
Fear of separatism and domestic instability has driven most Middle Eastern states to impose severe restrictions on the cultural and political rights of ethnic and religious minorities. These policies have led to relative underdevelopment and lower standards of living for some ethnic and religious minorities.
The most important example is the Kurds who live in Iran, Iraq, Syria, and Turkey. The four countries, despite confronting similar demands for political and cultural rights, have generally not coordinated their responses. Often, one country has supported the struggle of Kurdish groups against a neighbor. Turkey and Iran, for example, while suppressing their own Kurdish citizens, have accused each other of supporting Kurdish insurgencies in the other.
There have been occasional bilateral agreements, but these have been limited to security pacts against separatist Kurdish groups, without any focus on positive coordination for development and cultural rights. The latest example is the recent security agreement between Iraq and Turkey against the Kurdish Workers Party (PKK) presence in northern Iraq.
Given the persistence of Kurdish nationalism despite repression, an effort by all four countries to enhance the rights and living standards of Kurds could have many positive benefits.
Current policies date to the emergence of modern states in the Middle East after World War I when dominant ethnic groups – Turks, Persians, and Arabs – supported cultural homogenization as a requirement for state building, national unity, and territorial integrity. Consequently, they have looked with suspicion at the demands of any ethnic minority for cultural expression and self-governance.
The majority ethnic group in each country also fears that giving concessions to the Kurds could facilitate outside intervention. Iran and Turkey are very mindful of how external support for Kurds in Iraq and Syria during periods of state failure resulted in the creation of semi-autonomous Kurdish regions under external protection.
These four countries could partially overcome their fears if they negotiated a common code of minority rights and a mechanism for coordinated implementation. Iran, Iraq, and Turkey (and at a later stage a stable Syria) could agree that while all citizens must learn and use the national language, Kurds and other ethnicities enjoy the right to preserve their ethnic heritage.
They could set standards for Kurdish language media, participation in local and national government, and the removal of political, social, and economic discrimination at the national level. This would imply a fairer distribution of national resources, development funds, and government jobs, which would reduce the development and income gap of the Kurds relative to the national average.
If the approach was regional, it would be easier for the majority ethnic group in each country to accept the concessions, without worrying that they would be exploited by a neighbor to instigate instability and separatism.
Precedents for such measures can be found in Europe after World War II and again after the collapse of the Soviet Union. European countries at risk of ethnic unrest and civil war cooperated to support ethnic rights while resisting demands for secession and separatism.
Transition Toward Low Fertility
The Middle East has experienced a significant demographic transition from high growth rates in the 1960s and ‘70s to moderate rates after 1990. However, the situation now is uneven. Some countries that have experienced large declines, such as Iran and Turkey, are trying to reverse the trend, while Egypt, Algeria, Yemen, and Iraq are still experiencing high fertility rates and population growth rates that exceed one percent a year.
Ideally, the successful countries should continue their low fertility trajectories while encouraging MENA countries with relatively higher rates to lower them.
The total population of the region was 106 million in 1960 and reached 256.2 million by 1990, according to World Bank data. The successful family planning policies in many MENA countries, and the rising level of education among women, reduced fertility rates. By 2020 the total population stood at 479.96 million (estimated at 500 million in 2024). If rates had not declined, the figure would have been near 600 million.
In Iran and Turkey, fertility rates have dropped to 1.5 to 1.6 children per woman, below the 2.1 births required for a stable population. This decline is also visible in wealthier Arab countries such as Kuwait and the United Arab Emirates. Some governments that celebrated the decline in the 1990s and 2000s are now raising alarms. In a significant policy reversal, Iran and Turkey are offering incentives to encourage households to have more children.
MENA governments are concerned about the declining share of working-age people relative to the retired and elderly population in coming decades. Some countries also view a large population as contributing to military and economic strength and fear they will be disadvantaged by the relative size of their populations compared to other Middle Eastern countries.
Some governments focus on the fertility differential among ethnic groups. In Israel, for example, Jews and Palestinians have been involved in a demographic war alongside multiple other clashes.
Since many MENA countries, and the region as a whole (with the exception of oil-rich GCC states) suffer from high youth unemployment, low per capita income, and weak industrial activity, there is no advantage to high population growth. Moderate fertility rates in the range of 1.8 to 2.1, which result in a graduate decline or stable population levels, would be preferable. If through regional coordination, MENA countries with higher rates commit to putting more effort into reducing population growth, the countries that have achieved lower fertility rates might feel less compelled to reverse their population policies. A stable or declining population will raise short-term challenges but help future generations enjoy more prosperity.
Regional Coordination Toward A Two-State Solution
While there are many disagreements and rivalries among Middle Eastern leaders, they all say they support Palestinian aspirations for statehood. However, individual countries have followed differing and often contradictory and counterproductive strategies.
On one side, Iran and its regional allies known as the Axis of Resistance are engaged in military confrontation with Israel. Since the Hamas attack on Israel last October 7, this confrontation has threatened to escalate into a regional war drawing in multiple local and external powers.
On the other side are the MENA countries that have recognized Israel, such as Egypt, Turkey, Jordan, and Morocco, the UAE and Bahrain, and countries flirting with such recognition, such as Saudi Arabia. These countries in general do not support Hamas or other actors that engage in armed resistance. Instead, they offer economic support to Palestinians and engage in diplomatic negotiations with Israel and the United States in support of the Palestinian cause.
After more than 80 years of Palestinian struggle and countless lives lost, neither side has been successful.
Despite some reduction of tensions among MENA countries over the past two years, they have not achieved coordination in their Palestine policies. Iran is still strongly opposed to the participation of some Arab countries in the Abraham Accords. Saudi Arabia, Jordan, and the UAE, in turn, oppose Iran’s support for Arab proxies and accuse Tehran of destabilizing the region and interfering in Arab affairs.
There is some evidence that the prospects for diplomatic cooperation among Middle Eastern countries have improved since the start of the Gaza war. Iran, for example, has signed off on several communiques calling for a two-state solution. If despite their differences and regional rivalries, the Middle Eastern countries could agree on a unified and coordinated policy toward the Palestinian crisis, they would be more effective. Such coordination requires realism and a willingness to compromise. Iran and the Axis of Resistance, for example, must accept that Israel enjoys full U.S. support and cannot be defeated militarily.
Similarly, the Abraham Accords bloc must accept that decades of negotiations and friendly lobbying in Washington have not secured a homeland for the Palestinians.
A coordinated posture by the Arabs, Iran, and Turkey that offers a collective regional normalization of relations with Israel conditional on Israeli acceptance of two states and a consequent termination of all military activities against Israel, would create a more effective negotiating partner for the U.S. and Israel. It would also increase the likelihood of success for supporters of Palestinian sovereignty and independence.
Nader Habibi is an Iranian American economist and Henry J. Leir Professor of Practice in the Economics of the Middle East at Brandeis University.
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