Review of Environment, Energy and Economics - Re3 The Birth of a Jihadist Caliphate


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The Birth of a Jihadist Caliphate
by Daniel Atzori
Economics - Articles

The jihadist group formerly known as ISIS, which already controls vast areas of Syria and Iraq, has recently proclaimed the restoration of the caliphate. The presence of a jihadist state in the Middle East represents a formidable threat to the Arab state system. 

Keywords: Oil, Energy, Political Economy, MENA, Globalization, Arab Spring, Jihad, Terrorism, Islamism, ISIS, Islamic State, Al-Qaeda, Muslim Brotherhood

JEL: F51, N45

Suggested citation: Atzori, Daniel, The Birth of a Jihadist Caliphate (July 25, 2014). Review of Environment, Energy and Economics (Re3),

The contemporary Arab state system was born out of the ashes of the Ottoman caliphate. Jihadists are claiming that a new caliphate is rising again, like the Arabian Phoenix, out of the ashes of the Arab state system. 

For decades, Islamists worldwide have dreamed of restoring the caliphate, abolished by Turkey’s National Assembly in 1924 after the Ottoman defeat in the First World War. On the first day of Ramadan 1435, which corresponds to the 29th of June 2014, the jihadist movement, once known in the West as ISIS (Islamic State of Iraq and Syria) or ISIL (Islamic State of Iraq and the Levant), has declared the restoration of the caliphate. The head of the jihadist group, Abu Bakr al-Baghdadi, claimed to be the new caliph (khalifa) and prince of the believers (amir al-mu’minin), and asked for the loyalty of Muslims all over the world. In a recent document, entitled “A message to the mujahidin and the Muslim ummah in the month of Ramadan”, Abu Bakr al-Baghdadi affirmed:

“So let the world know that we are living today in a new era. Whoever was heedless must now be alert. Whoever was sleeping must now awaken. Whoever was shocked and amazed must comprehend. The Muslims today have a loud, thundering statement, and possess heavy boots. They have a statement that will cause the world to hear and understand the meaning of terrorism, and boots that will trample the idol of nationalism, destroy the idol of democracy and uncover its deviant nature.”

The proclamation of the coming of a “new era” would only seem propaganda, if ISIS, which now simply calls itself Islamic State (al-dawla al-islamiyya), were not already in control of vast lands which, until not long ago, were ruled by the Iraqi and Syrian governments. 

The conflict between transnational jihadism and the Arab state
The Islamic State dominates, at the time of writing, important Iraqi cities such as Mosul, Tikrit and  Fallujah, as well as the former Iraqi borders with Jordan and the frontiers of the Kurdistan Regional Government. The jihadists aim to conquer Damascus, once the capital of the Umayyad caliphate (661-750) and Baghdad, the capital of the Abbasid caliphate (750-1258), while it already controls Raqqa, which was the headquarter of the caliph Harun al-Rashid (796-809) against the Byzantine Empire. The jihadists’ dreams consists in the reactivation of the caliphate, which Islamists view as the golden age of Islam. Past, present and future blend in their utopia. 

In Abu Bakr’s statement reported above, the jihadist leader calls Muslims to trample “the idol of nationalism”. There is indeed an irreconcilable tension between Islamism, even more in its jihadist version, and the Arab state. The caliphate used to be a form of government, which embodied the political unity of the whole Muslim community (umma). Thus, from the point of view of the jihadists, if a legitimate caliphate arises, formal allegiances to nation-states are meaningless; this means redrawing the entire political map of the Middle East. Abu Bakr al-Baghdadi does not consider contemporary Muslims leaders as legitimate, rather seeing them as “the treacherous rulers – the agents of the crusaders and the atheists, and the guards of the Jews”. What is more, the jihadist leader declares to Muslims:

“Raise your head high, for today – by Allah’s grace – you have a state and khilafah [caliphate], which will return your dignity, might, rights, and leadership. It is a state where the Arab and non-Arab, the white man and black man, the easterner and westerner are all brothers. […] Therefore, rush O Muslims to your state. Yes, it is your state. Rush, because Syria is not for the Syrians, and Iraq is not for the Iraqis. The earth is Allah’s. […] The State is a state for all Muslims. The land is for the Muslims, all the Muslims.”  

For jihadists, the caliphate is the only legitimate state. It is worth noticing that the Prophet Muhammad was not only, according to Muslims, the messenger and prophet of God, but also the head of a polity, an Islamic state whose capital was Medina. The death of the Prophet Muhammad, in 632, created a vacuum of power among the first Muslim community. Abu Bakr al-Baghdadi is not the real name of the jihadist leader; indeed, Abu Bakr was the name of the first caliph, chosen among the companions of the Prophet Muhammad. The word “caliph” derives from the Arabic word khalifah, which means successor; hence, the caliph is considered as the political successor of the Prophet Muhammad. The institution of the caliphate always had, throughout Islamic history, an enormous political importance; since its abolition, ninety years ago, the notion of “caliphate” maintained a huge symbolic importance. That is why the jihadists’ declaration of its restoration is so remarkable. Indeed, Islamism itself developed in concomitance with the decline and fall of this ancient institution. The Muslim Brotherhood, the most influential Islamist movement in the Arab world, was established in 1928, only four years after its abolition; since its inception, the goal of organization was clear: the reconstruction of the caliphate. 

The First World War and the abolition of the caliphate ushered, for the Arab world, the triumph of the nation-state. The street protests of 2011, by challenging Arab authoritarian regimes, opened a window of opportunity to overcome the split of the Islamic world into nation-states, seen as a colonial legacy. For jihadists, the caliphate seemed at hand.

From war of position to war of maneuver
While the Muslim Brotherhood generally opted for a gradualist, bottom-up strategy, other Islamist movements, such as Al-Qaeda, chose other means. Using the terminology adopted by Antonio Gramsci to refer to the revolutionary movements’ strategies, the Muslim Brotherhood embraced a “war of position”, likened to the First World War trench warfare. Al-Qaeda and other jihadist movements, on the other hand, recurred to a “war of maneuver”, which we could compare with the highly mobile German blitzkrieg. The breeding ground of Al-Qaeda was the anti-Soviet jihad fought in Afghanistan in the 80s, followed by, among the others, the Algerian and Bosnian civil wars. Now, the Syrian civil war has provided the breeding ground of a new generation of jihadists to emerge. They are extremely violent and brutal, but often young and educated, as well as skilled in the use of social media: hashtags such as “#IslamicState”, “#CaliphateRestored” and “#IS” have made their messages increasingly popular on Twitter. It is ironic that, at the beginning of the so-called Arab Spring, there was a widespread hope, in the West, that social media would have spread democracy throughout the Middle East; today, they are used to spread jihad. However, their war is not virtual. The Islamic State has achieved a result that al-Qaeda never even dreamed of: it created a state. The retrospective utopia of Islamism, based on the dream of restoring an allegedly perfect society, which already existed in the past, has been attained. It is obviously too early to assess whether the Islamic State will last; but the importance of its declaration, at least from a symbolic point of view, is huge.

The 1917 Russian revolution demonstrated to the whole world that a Communist revolution was feasible. Worldwide, Communists were galvanized, as much as anti-Communists were scared. The 2014 proclamation of the Islamic State has demonstrated that the restoration of the caliphate is not utopian. Utopia literally means “no place”. Now, there is a place: the Islamic State. It is therefore possible that fellow jihadists worldwide will be enthused, and will join the cause of the Islamic State. Indeed, according to Islamic jurisprudence, a caliph has the right to declare jihad. This is obviously not to imply that the entire Middle East is about to be swallowed up by the caliphate; however, the Arab state system is undergoing profound tectonic shifts. 

The process of erosion of the Arab State
The Arab uprisings of 2011 were a sign of the profound crisis of the Arab state. The weakness of this form of political organization has always been its difficulty in exerting hegemony upon society. While possessing strong coercive apparatuses, the Arab state was less able to gain the consensus of the population. According to the Islamists, the Arab state is a colonial legacy, a social construction extraneous to Muslim people.  

The historical caliphates, such as the Umayyads, the Abbasids and the Ottomans, ruled upon peoples of different creeds and ethnicities. Islam provided the legitimacy to these political systems. During the 19th century, while the Ottoman caliphate was undergoing a process of profound crisis, which eventually led to its dissolution, Arab nationalism developed. By celebrating Arab civilization, instead of Islam, this ideology managed to attract Arab Christians and Muslims alike. Arab nationalism reached its height during the charismatic presidency of Egyptian President Gamal Abdel Nasser (1956-1970). However, the defeat of Egypt during the Six Day War against Israel (5-10 June 2014) represented a fatal blow for Arab nationalism. Thus, in 1967 a steady process of erosion of this ideology began. Together with socialism and secularism, also Arab nationalism was blamed for the defeat. From the Islamist point of view, if the Arab world wanted to regain its pride and glory, it had to abandon Western ideology, and go back to Islam. Since then, waves of Islamization invested Arab societies, eroding the very foundations the Arab state was based upon. This has been particularly evident in the countries where the ideology of Arab nationalism, in its different forms, provided the foundations of the state. 

This process of erosion did not touch, if not marginally, the Gulf states, since they based their legitimacy more on a social pact guaranteed by energy revenues than on ideology (Atzori, 2003). The situation is different for Saddam Hussein’s Iraq and Muammar Qaddafi’s Libya, which based their legitimacy on a blend of energy revenues, Arab ideology and sheer coercion. These regimes, already discredited, were ousted by foreign interventions, the 2003 US invasion of Iraq and the 2011 military intervention in Libya. After the removal of the dictators, Iraqis and Libyans were incapable of rebuilding a functional state; the states themselves, and not merely the authoritarian regimes, were lacking legitimacy in the eyes of the people. 

What future for the Arab state?
The presence of either a failed state or a jihadist state across territories, which once belonged to the Iraqi and Syrian states, is a worrying sign of the possible dissolution of the modern state system established by the 1916 Sykes-Picot agreements, at the twilight of the Ottoman Empire.

The disengagement of the United States from Iraq has created a power vacuum which is currently being filled by the jihadists, in several Sunni regions of Iraq, and by Iran, in the Shiite areas. In the meanwhile, the Kurdistan Regional Government (KRG) may seize the moment to proclaim its independence. KRG’s President Massoud Barzani already called for a referendum in order to decide the independence of the Kurdistan.

Are we about to witness a dissolution of the Iraqi state? The possibility of a flaring up of internecine warfare in both Syria and Iraq is highly likely. In both Iraq and Syria, authoritarian regimes guaranteed for decades, with the iron fist, the coexistence between different ethnicities and sects. The fall of the regime of Saddam Hussein and the crisis of the regime of Bashar al-Assad did not pave the way for Western-style liberal-democracy, but to a Hobbes’ state of nature, of a war of all against all. 

After the fall of Mubarak in 2011, it was highly probable for Egypt to follow a similar path. Tensions between Islamists and Christians, as well as between Islamists and seculars, were already threatening the very existence of the Egyptian state, while jihadists were attempting to transform the Sinai into a safe haven of terrorism.

Several Western policy-makers and analysts hoped that, under the presidency of Muhammad Morsi, who came to power in July 2011, the Muslim Brotherhood would have transformed itself into a conservative, religiously inspired, yet liberal and democratic, political party. After all, political parties such as Italy’s Democrazia Cristiana (DC) and Germany’s Christlich Demokratische Union Deutschlands (CDU) combined a Christian inspiration with a solid belief in democracy. 

Could not Muhammad Morsi become the Muslim version of Konrad Adenauer, the CDU politician who was chancellor of West Germany from 1949 to 1963? The problem is that, once in power, the Muslim Brotherhood did not show any sign to accept political pluralism. They steadily pursued the project of transforming Egypt into an authoritarian Islamic state. At the same time, they mismanaged the economy to such an extent that the whole country was plunging into chaos. In other words, Egypt seemed on the verge of becoming a failed state. Massive street protests and the intervention of the army managed to reserve the situation, demonstrating that the crisis of the Arab state was not irreversible. Abdel Fattah el-Sisi proved that the Arab state could be re-established. Ordinary Egyptians understood that stability is much more valuable than the Islamic State utopia. 

Libya may be undergoing a similar path: troubled by violence since the fall of Qaddafi, it is now witnessing an attempt to re-establish state authority under the leadership of General Khalifa Haftar. Haftar’s Operation Karama is an attempt to fight jihadist militias in order to restore the prerogatives of the state, first of all its monopoly of the legitimate use of violence.

Concluding Remarks
While stability attempts could prevail in North Africa, the Islamic State is threatening Western Asia. The new caliphate would attract legions of jihadists from all over the world, providing a safe haven for terrorism. As we said, the previous generation of jihadists grew in the 80s Afghanistan, then in the 90s fought in Bosnia, Algeria and elsewhere. In the following decade, they brought terrorism to United States and Europe. At present, no one knows where the new “international brigades” of jihadism, sprung out of the Syrian conflict, will go next. All the great powers of the world are concerned, including Russia and China, since foreign terrorists could fuel tensions in both Chechnya and Xinjiang. After all, the Islamic State is not hiding its desire to make its jihad global. 

It should be clear that the threats posed by the Islamic State are different from those posed by al-Qaeda. While al-Qaeda, as an international terrorist network, had a very fluid nature, the Islamic State has declared statehood, it controls a territory and at the same time claims power on all Muslim lands, as well as on the territories once occupied by Muslims, including vast areas of Europe. Al-Baghdadi even affirmed its project to conquer Rome, the capital of Catholic Christianity. 

Despite its sophisticated and smart use of social networks, the Islamic State’s decision to proclaim statehood makes it vulnerable. A successful military offensive could effectively erase the Islamic State from the map. However, at this stage is not clear who has the political will to counteract the jihadists. The Iraqi army alone do not seem able to face the jihadists, also because many of its soldiers are Sunni, and may not be happy to fight their own coreligionists. On the other hand, any kind of Iranian intervention against the jihadists will only manage to increase the popularity of the cause of the caliphate among Sunnis worldwide. The international community should be aware that the Islamic State is no longer a mere regional issue.


Al-Baghdadi, Abu Bakr, A message to the mujahidin and the Muslim ummah in the month of Ramadan, Al-Hayat Media Center, 2014.

Atzori, D., The Political Economy of Oil and the Crisis of the Arab State System, FEEM, Nota di lavoro, 61.2013

Ayyubi, N., Over-stating the Arab State. Politics and Society in the Middle East, I.B. Tauris, New York, 1995










Daniele Atzori is senior researcher at FEEM Milan