Special Report: Hamas In Transition | STRATFOR

Special Report: Hamas In Transition | STRATFOR


After more than five years of existing in political stalemate, Hamas is now trying to manage a worsening relationship with Iran and Syria and exploit the political rise of its Islamist parent organization, the Egyptian Muslim Brotherhood (MB). Without a clear vision on how to proceed, Hamas is likely to undergo serious internal strains that could raise the potential for a splintering of the heretofore most tightly run organization of the Palestinian territories.
Six years ago, Hamas unexpectedly swept parliamentary elections in the Palestinian territories and won the right to form a government. But the idea of a self-professed Islamist militant organization running the Palestinian government did not sit well with Israel and much of the West or with Hamas' rival, Fatah. Sanctions on Hamas immediately intensified, and a civil war broke out between Hamas and Fatah. Hamas was driven into political isolation after it forcibly took over the Gaza Strip in mid-2007.
Hamas then entered a long period of political stagnation. As a heavily sanctioned political pariah, the group's financial stresses rose. This provided Iran an opportunity to deepen its financial links with the Hamas regime. Though weapons and supplies still flowed to Gaza, the Egyptian regime of then-President Hosni Mubarak maintained a tight security grip over the Sinai-Gaza border to keep Hamas under control. When Israel launched Operation Cast Lead in December 2008, Hamas was able to both resist and garner international sympathy, but the two-month operation still dealt a blow to Hamas militarily and did little to ease the group's political constraints. Apart from a rampant smuggling trade via Gaza tunnels, Hamas had little space to exercise its political authority.
But regional events in 2011 brought about large changes in the challenges and opportunities faced by Hamas. Political demonstrations in Egypt led to the fall of Mubarak. After decades of being repressed by the Mubarak regime, the Egyptian MB entered the political mainstream. Though the military, which remains Egypt's ultimate authority, wants to keep Hamas confined in Gaza, the MB's rise has raised international acceptance of Islamists as political players. When Arab unrest reached Syria, Hamas' refusal to publicly support the regime of President Bashar al Assad cost its exiled politburo its footing with the regime in Damascus; Hamas had to start seeking an alternative base. Meanwhile, as demonstrations continued to spread throughout the Arab world, Iran's growing assertiveness in the region put the spotlight on Hamas, a Sunni entity, for its substantial ties with the Shiite Islamic Republic.
The group now finds itself at a turning point. Hamas has to balance deteriorating relationships with longtime patrons Iran and Syria, establish a new political vision, identify proper sources of funding and manage growing internal disagreements.

Picking Sides

When al Assad's Alawite regime began resorting to more violent crackdowns against a growing, Sunni-dominated opposition, Hamas leaders in Damascus, led by politburo chief Khaled Meshaal, had reason to be nervous. Damascus has served as the exiled leadership's main hub of operations since 2001, and it is the main channel for funding to reach Hamas. When unrest in Syria began, Hamas' best option was to try to not appear involved in Syria's internal affairs; the group could not risk its credibility by standing behind an Iranian-backed Alawite regime against Sunni resistance. Because of the overwhelming support in the Arab world for the Sunni-led uprising, Hamas could no longer ignore, as it did in the past, the al Assad regime's intolerance of its comrades in Syria's branch of the MB.
In August and September, Syria and Iran tried to pressure Hamas into organizing pro-Assad demonstrations in the Palestinian refugee camps in Syria. It was time for Hamas to decide whom it would support. Hamas had two choices: It could follow orders and showcase its close alignment with the Iran and Syria, or it could create some distance from the Iranian-led coalition, use that distance to reinforce its relations with its Sunni Arab neighbors and, most critically, seize the opportunity to follow the MB's lead out of political isolation.
Hamas chose the latter and refused to stage the demonstrations. The group could not afford to side against a wave of Sunni opposition without absorbing a hit to its legitimacy. Yet beyond the ideological discomfort it was experiencing, Hamas had a bigger vision in mind.

Hamas' Political Vision

Hamas formally was created in 1987, largely as the result of two factors. First was public dissatisfaction with the secularist and corrupt Fatah-led Palestine Liberation Organization (PLO). The second was an effort by the MB to respond to the first intifada in a way that allowed it to remain politically insulated. The creation of a separate Gaza group that could engage in armed resistance answered the MB's dilemma. However, Hamas' original leadership still viewed militancy as a means to a political end. Hamas founder Sheikh Ahmed Yassin, the leader of the MB and of the Islamic Center in Gaza, argued that Hamas was basically a political movement: It would fight for the rights of Palestinians, with the objective of eliminating Israel. The violent means Hamas has used make it highly controversial as a political player, but it is important to note that Hamas has held political ambitions since its inception.
Hamas' core struggle is over how to proceed along that political path while presiding over a stateless entity -- especially when its reputation has been primarily built on militant resistance, not on political credentials. As the organization learned after the 2006 election, even a sweeping political victory in the Palestinian territories yields limited results for an organization widely recognized as the premier Palestinian militant group. In other words, if Hamas was not prepared to abandon its militant arm and change its charter to recognize Israel, it needed to undergo a serious rebranding effort.
That opportunity came with the fall of Mubarak. The spread of unrest provided an opening for Islamist groups throughout the region to raise their political voice and force a wider acceptance of their growing role in the political affairs of the Arab world. The rise of the Egyptian MB in particular created an opening for Hamas to publicly reassert itself as a legitimate political player operating in the same league as its parent organization.
However, Hamas must make several difficult political decisions to achieve such a transition.

Coping with Finances

Hamas is highly secretive about its finances, but it has been unable to fully conceal the financial stress it has experienced over the past several months. It has been widely rumored that Iran began curtailing its monthly payments to Hamas after the group's refusal to demonstrate on behalf of the Syrian regime. According to multiple sources, Iran had directed $25 million per month to Hamas; to put that in perspective, Hamas' stated annual budget for administering the Gaza Strip is about $700 million.
In addition to the decline in Iranian financing, Hamas may also have reason to be concerned about the status of its investments in Syria. A number of Hamas members have business partnerships with members of the Syrian business community, including those close to the regime. Though the value of these assets is unknown, much of Syrian investment linked to Hamas is in real estate, resorts, food imports and olive oil exports.
Hamas may also be seeing less income from Islamic charities. Though a significant amount of funding is still likely earmarked for Hamas, a Stratfor source linked to the group said the rise of the MB and other regional Islamist opposition groups has attracted a major influx of money from donors looking to sustain the effects of the Arab Spring, making Hamas a lower priority.
These are not the only sources of Hamas funding. Hamas is believed to make about $50 million per year by taxing trade that runs through the Gaza Strip's extensive tunnel system. The group also reaps an unknown amount of profits from local businesses in which it holds a significant stake, including the Gaza Strip's only shopping mall and sea resorts and businesses spread throughout the Middle East, Southeast Asia and Central Asia.
Nonetheless, there are indications that Hamas is experiencing significant financial pain because of its worsening relationship with Iran and Syria. Meshaal and Gaza-based Hamas leader Ismail Haniyeh have been taking tours throughout the region in recent weeks to meet with leaders from Jordan, Qatar, Egypt, Saudi Arabia and Turkey. Hamas has allegedly sought financing from these states to compensate for the drop in Iranian support. Due to the uncertainty faced by the Syrian regime, Meshaal's faction also has reportedly been gauging these states' willingness to provide a new base and office space for the group's exiled leadership.

The Costs and Benefits of a Relationship with Hamas

Hamas can make a compelling offer to these states. With concern growing in the region over how to check Iran's power, Hamas' move to distance itself from Iran and its allies in Syria could significantly undermine Tehran's influence in the Levant region. Additionally, these countries, particularly Egypt and Jordan, see a strategic interest in bringing Hamas closer. They can build leverage with the group -- creating another mechanism to balance Israel's power -- but also use that increased influence to keep Hamas in check. However, the strict condition these states are attaching to any deal are giving Hamas pause.
Jordan, Egypt, Saudi Arabia, Qatar and Turkey share an interest in keeping Hamas hemmed in Gaza. These states frequently express their support of the principle of Palestinian statehood, but Egypt, Jordan and Saudi Arabia in particular are most concerned by the idea of a Palestinian polity emerging that could threaten their national security. Egypt, dealing with an emboldened MB, does not want Hamas to break free of its isolation and meddle in Egyptian affairs. The Egyptian military elite is already on alert for Hamas attempts to instigate a crisis between Egypt and Israel; such a crisis could rally Egyptians and Palestinians alike and provide the Islamist opposition with the means to discredit the military's authority. In Jordan, where Palestinians constitute a majority of the population, the ethnically distinct Hashemite regime is facing a vociferous opposition led by the Jordanian MB and does not want to embolden its Palestinian population. Saudi Arabia has long had a tense relationship with Hamas and remembers well its past brushes with Palestinian militancy.
Building leverage with a militant group comes with risks. If any of these states agreed to start or increase funding for Hamas or host a Hamas office, they would not want to be held accountable for renegade actions by the group, especially by the United States and Israel. At the same time, they know Hamas is not ready to disarm, recognize Israel and make a full political transition.

Sending Mixed Signals to Tehran

These states also understand that Hamas is unlikely to completely sever its ties with Iran. Beyond the money, weapons and training it has received from Iran and its allies, Hamas needs to maintain a decent working relationship with Iran to avoid creating greater complications for itself in the Gaza Strip.
Palestinian Islamic Jihad (PIJ), a much smaller militant outfit than Hamas, has had a tight financial, ideological and logistical relationship with the Islamic Republic since the group's inception in 1980. PIJ is firmly committed to its militant campaign. The group openly rejects building ties with surrounding Arab states due to their perceived hypocrisy toward Palestinian statehood and the Arab states' alleged collusion with Israel. PIJ is thus the most likely Palestinian recipient of Iranian aid no longer destined for Hamas. PIJ and Hamas have long cooperated. Hamas is even suspected of occasionally relying on PIJ to carry out attacks, in an effort for Hamas to maintain plausible deniability in dealing with Israel. However, Hamas may have a decreased ability to control PIJ actions within Gaza if Hamas is no longer cooperating closely with PIJ's main backer, Iran. So long as Hamas controls Gaza, Israel will likely hold Hamas accountable for any attacks that emanate from there. A significant loss of control over militancy in Gaza could thus leave Hamas in a much more precarious position with regard to Israel.
Hamas' leadership seems to have been sending mixed signals to Tehran -- rather than running the risks involved in an outright break -- while waiting for agreements to come through with the Arab states. However, these states first want real assurances that Hamas will behave according to their standards and fundamentally shift away from the Iran-Syria axis. Indeed, according to the Palestinian Al Quds daily, Haniyeh was allegedly strongly advised by the leaders of Qatar, Bahrain and Kuwait to cancel his upcoming visit to Tehran if Hamas is serious about making a deal. Haniyeh's arrival in Tehran on Feb. 10, despite the demands of the Arab states, shows that Hamas still feels the need to keep its options open with Iran.
Hamas knows the opportunity the MB's political elevation presents, but several complications apparently are preventing Hamas from making any clear, hard decisions.
While struggling to balance between Sunni states and Iran, Hamas is also trying to find a way to moderate its political position at home. Ongoing Hamas efforts to reconcile with Fatah and become part of the PLO are designed to insulate Hamas from the drawbacks of ruling Gaza alone. Hamas will not capitulate to Fatah for the sake of reverting to a more comfortable opposition posture. The group wants to share enough power – and present itself in enough of a pragmatic light – to resume financial flows and provide Hamas with some plausible deniability in dealing with Israeli military reprisals against the Gaza Strip.
However, this is placing a lot of pressure on the group. In trying to reintegrate itself with Fatah under the PLO umbrella and reinforce its relations with the surrounding Arab states, Hamas risks developing a crisis in legitimacy among Palestinians. The group already has accomplished little during its time in political office. Should a power-sharing government with Fatah fail to yield results, Hamas could be susceptible to the same criticism levied against its secularist rivals. Money is still sorely lacking in the Gaza Strip, and middle class members of Hamas who are making money are increasingly viewed as corrupt in the Palestinian territories. Hamas does not want to risk being put in the same light as Fatah and thereby seeing its credibility erode among its own supporters.

A Hamas Splintering?

Stresses within Hamas are already beginning to manifest in the form of public spats between the group's Gaza-based leadership and its exiled leadership over which political course to take with Fatah, how to manage the group's finances and what terms Hamas should agree to in dealing with foreign backers. Deep, personal rivalries have long existed within these factions, but the strains appear to be turning more severe. This dynamic was most recently illustrated the week of Feb. 6, when Meshaal signed a power-sharing agreement with Fatah leader and Palestinian National Authority leader Mahmoud Abbas in Doha, Qatar. Haniyeh and his deputy Mahmoud Zahar did not attend the Doha summit, and their parliamentary bloc strongly rejected the deal two days later, citing a clause that said Abbas would remain both president and prime minister in a future government. Haniyeh has since denied any rifts within his movement, but the more Hamas insists on its unity, the more doubts are raised regarding its internal coherence.
Aside from questions about how to reconcile with Fatah, there is also the important question of who will handle Hamas' finances if the exiled leadership moves from its financial base in Damascus. It appears that Hamas is looking to set up multiple offices in countries that agree to host Hamas and help fund the organization. This could see the exiled leadership spread across Cairo, Amman and possibly Doha. Meshaal, who has Jordanian citizenship, is likely to end up in Amman while Mousa Abu Marzouk, deputy head of Hamas' political bureau, has already reportedly moved with his family to Cairo. A scattering of Hamas' exiled leadership to these capitals may serve to enhance the group's ties with each of these states and encourage them to increase their funding to Hamas, but it also leaves the group beholden to the interests of multiple states that share a desire to keep the group contained. Moreover, the wider Hamas' exiled leadership is spread, the more difficult these leaders will find it to coordinate and remain relevant compared to the Gaza-based leadership.


\Special Report: Hamas In Transition | STRATFOR

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