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Starting July 1, Israel may take the first step toward annexing territory in the West Bank, in line with U.S. President Donald Trump’s peace plan for the region. Discussions about the potential annexation have mostly focused on its implications for the two-state solution and renewed violence. But it would also have significant effects on Israel’s rivalry with Iran and on U.S. efforts to isolate Tehran. Although many Israelis view annexation as a strategic gain, the move would be a strategic gift for Tehran.
Annexation is not yet a done deal. According to the Israeli government’s coalition agreement, Prime Minister Benjamin Netanyahu may hold a cabinet or parliamentary vote on unilaterally annexing West Bank settlements and the Jordan Valley starting July 1, so long as the Israelis act in concert with Washington. But Benny Gantz, the alternate prime minister and defense minister, has expressed serious reservations, and Washington wants both leaders to be in agreement before it greenlights any decision. As July approaches, some Israeli politicians, retired security officials, and experts have warned that annexation would bring about the end of the two-state solution and potentially trigger another Palestinian intifada. And, for its part, Iran would likely welcome the chance to reassert its anti-Israel credentials.
Iran’s opposition to Israel, and its effort to disrupt any Arab-Israeli normalization, dates back to the country’s founding. The first supreme leader, Ruhollah Khomeini, made opposition to Israel a core pillar of the regime’s identity and approach to foreign affairs. These views have endured largely without interruption. Iranian officials have stridently opposed any progress toward Israeli-Palestinian peace, and Tehran has for decades provided assistance to Palestinian groups such as Hamas and Palestinian Islamic Jihad. The country has likewise tried to derail previous U.S.-supported efforts to broker peace, including the 1991 Madrid conference and the 1993 Oslo Accords.
Iran will likely spearhead international opposition to annexation. The regime would raise the mantle of its defense of Palestinian rights to distract from its own issues at home, including a botched response to the COVID-19 pandemic, a weak economy, and general popular exasperation with regime incompetence and corruption. Although the impact of such a propaganda campaign in changing public sentiment would likely be limited, it would lay the groundwork for the consolidation of a more hard-line agenda after the 2021 presidential elections. The annexation would also provide the regime with a golden opportunity to justify its increase in defense spending and its controversial expenditures abroad.
Perhaps more significantly, annexation would also provide Iran’s leaders with more ammunition to criticize Israel and escape, if only rhetorically, the U.S. campaign to isolate it in the region. Tehran can direct its ire toward those Muslim nations that have started to quietly normalize ties with Israel, such as Saudi Arabia and the United Arab Emirates. Iran’s regional policy has been a source of tension with its neighbors going back decades, but these concerns have intensified since the Arab Spring, after which Iran became more interventionist in conflicts in neighboring countries. Arab public perceptions of Iran have suffered as its regional presence has grown. And given that Iran was an epicenter for the coronavirus in the Middle East, it is facing significant headwinds. The Israeli-Palestinian conflict is a prime way for Iran to change the subject.
As annexation hands Iran an opportunity to improve its standing in the Middle East, it would also weaken Israel’s standing internationally and consume it domestically. In its zero-sum competition, a distracted Israel is a strong plus for Iran. Key international players have already made it clear that they oppose annexation and are preparing retaliatory measures. European states have warned Israel against unilateral annexation and are working with the European Union to develop sanctions. In the United States, Israel would weaken its relationship with key Democrats and further polarize American public support for Israel. The American Israel Public Affairs Committee, a pro-Israel lobbying group, already gave U.S. legislators a green light to publicly raise concerns about the annexation move, a rare decision for the most prominent organization supporting U.S.-Israeli ties. Moreover, given that the former vice president and presumptive Democratic presidential nominee Joe Biden openly opposes annexation, Israel is setting itself up for a difficult four years (at least) if Trump isn’t reelected in November. If annexation triggers a new wave of Palestinian violence, Israel’s military and security services will be forced to devote attention to the home front—giving Iran a chance to strengthen its hand on Israel’s frontiers, undermining U.S. efforts to keep Tehran under pressure across the region.
Meanwhile, Israel risks eroding years of work toward normalizing relations with key regional states. Over the past decade, Israel and Gulf Arab states have strengthened ties around a shared perception of the Iranian threat. From the U.S. perspective, this is a strong positive for its anti-Iran campaign. In practice, Arab states in the Persian Gulf may continue their security cooperation with Israel thanks to their wariness of Iran. But as the two sides of the Gulf take steps to address their issues (as modeled by the United Arab Emirates and Iran) and Israel’s plan raises the cost of Gulf acquiescence, public overtures toward Israel will be more difficult. In an op-ed and video earlier this month, Emirati Ambassador to the United States Yousef al-Otaiba underscored this point (although the UAE foreign minister last week tried to temper his statement). For its part, Iran will make sure to present itself as the only regional power still standing with Palestinians even as Gulf monarchies fold. In the long term, other Muslim states may be dissuaded from taking steps toward normalization with Israel.
Israel’s intention to pursue annexation has once again elevated the Palestinian issue, handing Iran a fresh opportunity to play the role of disruptor. Iran would be keen to exploit Israel’s isolation regionally and internationally. A more distracted Israel gives Iran an opportunity to shore up its diplomatic and military position in the region, at precisely the time the Trump administration is trying to turn the screws tighter. At the White House in January, Netanyahu praised the Trump proposal as a “great plan” and the “opportunity of the century.” As Israel gears up for the potential of annexation, Iranian leaders probably agree.