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The regional struggle between Iran and its allies, and Saudi Arabia and its allies, has heated up significantly. And finally, toward the end of the first year of the Trump administration, the impact of the transition between two markedly different US administrations, particularly in their respective approaches to the Middle East and Israel’s relations with its principal ally, the United States, has emerged clearly.

Against this background are several weighty long and short term challenges currently on Israel’s political-security agenda. Since its establishment Israel has had to contend with threats to its national security that both required immediate action and held complex significance for the future. Today too,the combined effect of strategic developments in Israel’s nearby and more remote environment presents Israel’s decision makers and policymakers with the expressed need to formulate responses based on the different contexts behind these events and trends, and the cumulative outcome of Israel’s military and political actions – reactive and proactive alike.

The titles of the chapters in Strategic Survey for Israel 2017-2018, the newest volume in the annual series published by the Institute for National Security Studies (INSS), reflect the major national security issues that Israel currently confronts and the dilemmas that will challenge it in the coming year and beyond. The titles also point to the inter-connections between the issues and the various arenas. As such, they signal that responses that are formulated for each challenge – whether they are manifested on a politicaldiplomatic level or are primarily military in nature – will have implications for complementary arenas. The book’s analyses of the different spheres and the challenges they pose are joined by policy recommendations that will help Israel influence a variety of components in its strategic environment in accordance with its leading interests and national goals.

The first chapters are dedicated to the State of Israel’s regional and global environment. Israel’s primary security challenge is its northern arena, in which a new balance of power is emerging based on the consolidation of Russian power in Syria, Iran’s foothold in parts of this battle-torn country, and the relative strengthening of Hezbollah. The specific significance of these developments is likewise analyzed in the chapter dealing with Iran’s strategic balance as it has evolved in the Middle East in recent years; in the chapter surveying the military defeat of the Islamic State; and in the chapter examining the evolving change in the balance of power between the world powers vis-à-vis the Middle East in general and the competition for power and influence between Russia and the United States in particular. The international status of the United States is discussed in a chapter that examines the North Korean nuclear crisis and its implications for contending with Iran’s nuclear program.

Subsequent chapters focus on a discussion of Israel’s central role in selected critical issues. One chapter addresses Israel’s relations with the United States, with an emphasis on the strategic proximity between the two countries and America’s importance to Israel – particularly in light of the challenges Israel currently faces. Another chapter analyzes the potential for renewing the Israeli-Palestinian dialogue and the implications that positive developments in this direction could have on Israel’s relations with the pragmatic Sunni states in the Middle East. The chapter that follows explores what is a “Jewish and democratic state,” and analyzes the theoretical and political roots of disagreements in the realm of Israeli national security. The book concludes with a net assessment by INSS Director Maj. Gen. (ret.) Amos Yadlin, which summarizes the political and security challenges now confronting Israel.

Yadlin’s analysis includes a list of policy recommendations that aim to reduce risks and threats and at the same time cultivate opportunities that, if realized, could help shape Israel’s environment and make it more secure and strategically comfortable. The editors of this volume would like to extend their gratitude to the INSS researchers who contributed the articles. In addition, as in every year since the launching of the Strategic Survey for Israel series nearly one decade ago, a major role in the preparation of this year’s volume was played by Moshe Grundman, the INSS Director of Publications, and Judith Rosen, editor of INSS English publications. We extend our heartfelt thanks to them and our deep appreciation for their assistance.

Shlomo Brom and Anat Kurz

December 2017

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Contents

Preface 7

The Northern Arena: Israel’s Principal Security Challenge
Udi Dekel and Carmit Valensi / 11

Iran and its Rivals: A Strategic Balance Sheet
Sima Shine / 29

The Ramifications of the Military Defeat of the Islamic State
Yoram Schweitzer / 39

International Actors in the Middle East: Common and Conflicting Interests
Oded Eran / 57

Confronting Nuclear Proliferation Challenges: Iran and North Korea
Emily B. Landau, Ephraim Asculai, and Shimon Stein / 69

Israel-United States Relations
Shahar Eilam and Assaf Orion / 81

Israel and the Middle East: Potential to Thaw the Frozen Political Process and Upgrade Relations in the Regional Arena
Shlomo Brom, Kobi Michael, Anat Kurz, and Gilead Sher / 91

Between a “Jewish and Democratic State” and Issues of National Security
Pnina Sharvit Baruch and Zipi Israeli / 105

Israel’s Strategic Environment: Elements, Challenges, and Policy Recommendations
Amos Yadlin / 131