Tag Archives: ISIS

Bank of ISIS: How to Bankrupt It

When you think of ISIS, forget the image of balaclava-clad men, with kalashnikovs screaming “Allahu Akbar”. Think of a carefully managed startup that has, like other successful companies, lured international investors, diversified its income and widened its outreach. Just like any startup runs on equity and investment, this terrorist organisation also obtained funds to organise its structure and plan operations.

If ISIS Inc. was headquartered in Silicon Valley, it would be considered one of the top private companies in America. Based on even conservative estimates, last year the group controlled assets in excess of $2 trillion, with an annual income amounting to $2.9 billion, according to Thomson Reuters. That’s more revenue than the retailer J Crew and the household appliance corporation, Conair, earn a year.

Wikipedia

Yet, in defeating ISIS, it’s important to dispel short-term solutions, particularly those that fall under the sway of “retribution” such as mass bombing. Sanctions and intense warfare alone won’t work, because ISIS thrives on the failure of Middle Eastern governments. To beat ISIS, governments must first address President Bashar al-Assad’s government in Syria as part of the problem. This is a mess born of the Iraq war and the Syrian civil war, the brutality and sectarianism of which has become a recruiting tool for the Islamic State. “Assad is not a sideshow,” says Emile Hokayem in this report. “He is at the center of this massive dilemma.”

Take ISIS’s authority over oil, for starters. It is by far the most lucrative commodity for the group. It is the “black gold that funds Isis’ black flag” and not only fuels the war machine, but also provides electricity and gives the jihadis critical leverage against their neighbours. Yet, blindly bombing ISIS’s oil reserves could actually help it more than it could hurt it by disrupting the livelihood of those who relied on oil trade. As Hassan Hassan, Chatham House associate fellow, writes:

Airstrikes disrupted this wartime economy and many families, who continued to buy oil from its new owners, ISIS, increasingly found it difficult to find alternative means to survive. This pushed some families to send their sons to join ISIS as the only way to generate a monthly income, according to several individuals living under ISIS.

The depletion of Syria’s ageing oilfields are, alone, containing ISIS to some degree. The group’s need for fuel for military operations also means there’s less to sell in the market.

It’s too late to expect that freezing the assets and halting the sale of weapons to those countries that have supported ISIS will stunt the organisation’s power. The jihadist group has already become immune to international sanctions.

Not only has it infiltrated every aspect of the economy, including the banking system (for example, more than 20 Syrian financial institutions continue to operate in ISIS-held territory, according to Matthew Levitt, director of the Stein Counterterrorism program), it has also been making millions for years simply through a string of illegal activities (think: extortion through illegal taxes, and kidnap and ransom payments, selling sex slaves and plundering of antiquities excavated from ancient palaces and archaeological sites).

So any optimism that ISIS will have financial oversight is short-lived. In fact, “blocking the assets that fill ISIS’ coffers would mean rethinking the world’s economy,” says Italian journalist Roberto Saviano, an impossible feat considering the group has already exploited the underbelly of the financial system.

So how do we bankrupt ISIS, considering all the above?

Forget the strategy that addresses the symptoms not the disease. Indeed, as Emad Mostaque, strategist at Ecstrat tells Rebel Economy:

Our governments guarantee us safety from political violence, so when political violence is introduced into public life, governments typically over react and expend valuable resources fighting a small, hard-to-hit enemy.

This is why the war on terror has been a resounding failure, spending $2 trillion, killing 2 million civilians and seeing the number of enemy recruits going from under 1,000 to over 100,000 in 14 years.

Instead, there should be more focus on a long-term option that addresses grave unemployment (remember, ISIS thrives on the Arab world’s failures to provide to the people and relies on unemployed youths for new recruits). This means providing people with opportunities to enter competitive, labour intensive jobs, within blue-collar industries and prevent the draw to radicalism. It is a strategy for economic reform that critically channels most of the gains to the bottom 80%. The summary of this five-fold plan, by Middle East analyst Nathan Field, is necessary reading for understanding why ISIS continues to recruit and grow stronger.

In the end, there’s many things to be done:

  • Focus on resolving the Syria crisis as a whole and life after the Assad regime

  • Get the region to think differently about jobs for youths to help stem the flow of disenfranchised young people to ISIS

  • Targeted attacks against ISIS to limit their growth, and other sanctions

  • Cyber war on the ISIS propaganda machine to mitigate their message

There’s also a radical option, more in line with the rebel fighters of Libya. Train Syrian refugees in Turkey and other parts of Europe in the art of sabotage and send them back in as the Resistance. The most embarrassing problem for ISIS is their own “people” striking back at them. Bankrupting ISIS, a terror group which has further reach than any group before it, can only happen if the entire structure collapses, and that starts from within.



Sinai: House of War

The Islamic State, or ISIS, and their affiliates are increasingly showing organizational skill and willingness to engage targets on foreign soil. But one of the key frontiers for this ruthless, extremist group is the Sinai Peninsula. Here, ISIS is building a new generation of jihadist fighters.  Mohannad Sabry, a journalist based in Cairo, has just published a book based on the security and political situation in Sinai, Sinai: Egypt’s Linchpin, Gaza’s Lifeline, Israel’s Nightmare. It was published a day before the Russian plane came down over Sinai, an eery reminder of the frequency of terrorist attacks and, ultimately, our lack of comprehension of the ISIS force. 

Sabry talked to Rebel Economy about how ISIS has become a “magnet in the field for militant groups, attracting every wannabe,” including the young and the amateur. For these young terrorists, the fall of the Metrojet flight to Russia, the killings of hundreds in Europe and beyond, is considered impressive.  Sinai, Sabry says, “has become Beit El Harb, a House of War.” 

  • First thing’s first. Was the Russian plane was taken down by a bomb?

It’s a possibility, but do we have any evidence? I don’t think so. The only evidence we have is residue left on the plane.  There’s little hope in having transparency on the subject. But you cannot just say you have a bomb on board without having any evidence. The intelligence didn’t tell us anything detailed. They just said we have theories, but nothing solid. That opens up a lot of speculation. Simple we have a very valid theory, but until we are given more evidence on the ground, we cannot confirm this theory. Is it 90% possible? Yes it is, but it’s not confirmed. We’re not getting any detailed information from the intelligence and the fact that the Russians and Egyptians are running the investigation is not helping, those countries do not have a track record of transparency.  

  • Why is Egypt so sure that there was no bomb? Is it possible they are not being honest?

They are denying any kind of crisis or scandal which is the usual Egyptian goal, the easiest thing to do for the Egyptian regime is to simply deny anything, and then everyone forgets about it. This is exactly what has happened after every crisis. After the Rabaa massacre, they said we didn’t commit the massacre. They thought they’d deny the scandal and no one would react. But this time the crisis is much bigger than anything they’ve ever handled before. And let’s not forget we are living in the post 9/11 world so anything that involves planes or flight security is terrifying for the world. It is unprecedented and something that Egyptians are not used to.

So now, the Egyptians are using a friendly rhetoric.

By simply holding a press conference instead of not acknowledging the crash, and the fact that one of the investigation team said that he heard the last minute recording of the black box demonstrates a difference in their tactics. The fact they brought Russian and British investigators to Sinai is unprecedented. They’ve been denying other countries access to Sinai and now we’re seeing access given by the Egyptians. But unfortunately it took a passenger flight to crash to change their actions, and 224 lives.

  • Do you think Suez Canal security is also a major issue?

The Suez Canal is far from the major Islamist territories of Sinai, it’s more than 200km away. There was one attack in 2013, and since then the egyptian military understands the importance of the Suez Canal. It’s an international investment and there’s an international collective concerned with securing it. We’ve seen groups infiltrate Ismaila, and in the capital where the Interior minister was killed. But the Canal is hundreds of kilometres long. Are they [militant groups] capable of causing more damage? Yes, it’s a possibility.

  • Can you explain a bit more about Ansar Beit al-Maqdis? What troubles have they caused? Are they the group people now refer to as Islamic State in Sinai?

In 2011 there was a dozen groups in Sinai, half of them were online and amateurs. Jeish el Islam, Tawhid Wal Islam, and others are among the groups associated with that region, but clearly the main group is Ansar Beit al-Maqdis, and they are a very understandable dynamic, and the bigger group in Sinai. They are doing what the Al Qaeda campaign did in the 1990s, when declaring global jihad and they ended up attracting other groups to them. What happened then is happening again with ISIS. They are a magnet in the field for militant groups, attracting every wannabe, including young and amateur Islamists. In the overall context, Sinai has become Beit El Harb – a House of War, not a House of Peace. This is actually more dangerous than having weapons – having a reputation and this is helping lure in the kids and the fragmented groups.

  • North Sinai always seems to be in the news for something terrible. Why is it that the Egyptian government can’t seem to regain control of the area? 

North Sinai is in the news every couple of days, there’s attacks all the times. Egypt is fighting a war with a guerrilla army, you’re talking about a military institution that relies mainly on conscripts that are simply ill-trained and unfortunately we’ve seen so many of them killed because they’re not trained to deal with a guerrilla war. There has been countless examples of intelligence failure, where in the best case scenario they failed to utilise the intelligence. All of this collectively explains why we are not winning the war.

  • Can you explain a bit more about the tribal system in Sinai? How does that affect the ability for the army and/or police to root out IS in Sinai? Why does Egypt military distrust the Bedouins?

The state doesn’t trust the Bedouin community, and they don’t want their help. I’ve met the tribal king pins and they’ve offered the Egyptian military help, but they’ve always refused this.

If it’s a case of why tribes haven’t taken out the Islamists, it’s more complicated than hiring a few Bedouins.

Intelligence requires sources to report what they see, like a Bedouin who sees an Islamist planting a bomb. That’s impossible in Sinai, though, because the Bedouin community is not being protected. Dozens of Bedouins have been beheaded. Yet the Bedouins have proved themselves loyal to the state – who freed the kidnapped tourists? Who freed the kidnapped soldiers under Morsi? But what do those guys get, they get nothing from the state.

Egypt is not willing to cooperate with the Bedouins and trust the community. But the easiest thing to do to gather intelligence is to secure the friendly relations of the people and to protect them from the killing.



The New Sinai

It is a dangerous time for Egypt. The latest reports to come out from Western governments blaming the crash on a bomb have shown Egypt’s worst fears may be true – the country has experienced one of its worst terrorist attacks. Now, the most likely scenario emerging is that a bomb was smuggled aboard the plane and exploded midflight, despite security and a relatively modern airport at Sharm El Sheikh. 

At first, the death of 224 people in the plane crash was seen by the Egyptian government as a tragic accident, and at the very least a dent on the economy.

Egyptian officials’ vehemently denied any terrorist link, dismissing claims by a militant group linked to the Islamic State who said that they brought down the plane. In fact, their initial assessment was of no foul play, according to someone close to the Egyptian intelligence services who spoke with Rebel Economy earlier today, and they were especially certain that the plane wasn’t hit by a missile.

Yet, just a few days later, the same officials, with a growing sense of confusion, prompted an investigation into the flight, and began to survey the fuselage and other materials onboard, according to the same source. Egypt continues to outwardly deny any terrorist involvement.

However, one of the most lethal groups in the region are now within shooting distance of two of Egypt’s most important economic lifelines and foreign currency earners: the Suez Canal and Sharm El Sheikh, one of the last remaining tourist destinations considered an oasis away from the turmoil elsewhere in the country.

And despite Egyptian officials and political analysts insisting for so long that extremist groups in North Sinai, where the ISIS affiliate is hiding out, didn’t likely have access to surface-to-air missiles that could take down a commercial airliner flying at 30,000 feet, the worst case scenario – an onboard bomb – has occurred. Not only does this demonstrated that ISIS are getting more sophisticated, and bypassing controls and borders, but that the government had no clue it was happening.

After all, it’s not easy to get a bomb on a plane in 2015.

Sinai has always been a study of contrasts: in the south, it’s full of tourists, luxury resorts, scuba diving, and lots of foreigners. The north is shockingly different – rundown cities, outlaws and Islamic extremists hiding in the desert and in mountain encampments. But now, what’s worrying is the influence of ISIS in Sinai and their proximity to big targets. Up till now, ISIS’s ambitions were limited by their geography. The classic ISIS in Syria are a scary phenomenon, but they have had limited access to Western targets.

The Sinai contingent is like a pick and mix of targets for militant group. It’s physically close to Jordan, Israel and mainland Egypt – all of which have a lot of westerners coming through, including attractive targets for a group seeking to make a bigger name for itself on the world stage. What’s more, Sinai is somewhat lawless, and its coastlines are under-policed.

It is a very dangerous place for ISIS to have a foothold, and could turn the fortune of the country around within months.