Published
October 08, 2024
The economic stakes are rising amid the tensions in the Middle East, as fighting between Israel and Iran’s proxies escalates into a direct conflict between Jerusalem and Tehran, said Johns Hopkins University professor Vali Nasr, speaking on The Call, a morning video update offered as part of the Chamber’s Global Intelligence Desk.
Nasr warned the economies of particularly the Persian Gulf region hang in the balance as the conflict escalates. The former U.S. government advisor shared his insights on Thursday, October 3, after Iran fired missiles into Israel, and as Jerusalem was expected to respond with some sort of counterstrike.
Nasr noted Iran is on the northern shore of a gulf it shares with the other exporters of the region. “It’s not just the flow of oil and gas from Qatar, Saudi Arabia, etc. through the Straits of Hormuz,” he said.
“The entire business model of the region is built around it being a stable, major hub in global trade,” Nasr said, adding: “Would the business model of these countries — becoming global centers, attracting investment, building new industries, etcetera — be viable if they're in a war zone?”
Nasr joined The Call after Iran retaliated in response to Israeli attacks on its regional proxies, militants including Hamas, Hezbollah and the Houthis, with Tehran sending nearly 200 ballistic missiles into Israel. The damage was limited by defensive measures taken by Israel and the U.S.
Israel, as Nasr was speaking on Thursday was expected to retaliate: “It is not in a mood to settle. It's not settling for a ceasefire in Gaza. It's not settling for a ceasefire in Lebanon,” he said. “And it wants to take the fight to Tehran.”
“The Iranians, similarly, have been putting enormous amount of pressure on Israel and the United States since October 7th, through Houthis, through Hezbollah, through Hamas. And they're not going to back off, either.”
“The region is entering a phase it has never been in before,” Nasr said. “Everybody in the region is nervous.”
About The Call
The Call is created for the Chamber’s membership by the Global Intelligence Desk. For more information, please email: globalintel@uschamber.com.
For more on the Chamber’s Middle East practice, please email slutes@uschamber.com
About the authors
Jay Sapsford
Jay Sapsford is Senior Vice President for Global Risk Analysis and helps lead the Chamber’s efforts in assessing geopolitical and economic risks that impact the business community. He plays a key role in identifying global trends, risks, and opportunities on behalf of the Chamber’s membership.
