The Islamic State, development and economic trajectories

IS is not merely a terrorist organization, in fact it displays some very specific features that are not found in common terrorist organizations. First, IS has shown to be able to effectively exploit long-established transnational smuggling routes and gray markets as well as to manage a complex and widespread racket system in controlled areas: IS strategies mirrors a mafia-like organization with tentacles intruding in many aspects of political and economic life of occupied territories. Secondly, IS deploys its military forces with impressive strategic planning: its recruits are trained to be professional soldiers with notions of guerrilla-style operations and tactical manoeuvrings. IS also controls an intelligence apparatus with the purpose of collecting and processing viable information. Third, IS has formalized its organizational structure to resemble a state-entity, it has established pervasive governance structures in the occupied territories and it is attempting to manage those areas offering service provision, law and order, education and operating industrial facilities.
The first chapter is focused on IS origins and first developments, from being an al-Qaeda franchise in the Levant until it severed its ties and established an independent Caliphate. This chapter is a functional background introduction to the entire work, as I think it is not possible to understand IS present and future development without highlighting some crucial passages of IS history: the methodological and ideological dispute with al-Qaeda, the influence of ex-Ba‘athist officials, the impact of the discriminatory Shia government in Iraq, the complicity of the Syrian regime toward jihadist groups, all have contributed to what IS is today.
The second chapter offers a detailed overview of IS finances: I have first studied the figures from a general perspective, and then I have isolated each financial source and examined its percentage share and its mutation over the years. The majority of IS resources are extractive, from natural assets (oil, gas, phosphates, etc.), from the economic infrastructure (bank looting, antiquities smuggling, etc.) and from human activities (taxes, confiscation, racketing, etc.): the overview shows the creation of a wide network of illicit and illegal activities, based on customary smuggling routes, and successfully infiltrated by IS. The chapter is closed by an analysis centred on the war economy, its impact on the Syrian population and the far-reaching consequences of the destruction of the entire economic productive system of the country.
The third chapter focuses on IS governance structure and balance-sheet: focusing on budgetary requirements and expenditure trends, helps to define future economic trajectories, it provides an insight on IS actual governance ability and exposes IS vulnerabilities. In order to anchor the data to real life situation, I have presented two case studies as practical examples of IS governance structure and economic administration: the case of al-Raqqah, the de-facto capital of the Caliphate and the case of Wilāyat al-Khayr, the administrative division corresponding to Dayr al-Zūr province. Both cases are unique for the kind of first-hand information we have about them and because they are exemplary of IS policies and development trends.
The conclusive chapter covers three topics: a qualitative examination of IS critical capabilities, requirements and vulnerabilities, in order to define IS future trajectory, including its weaknesses and strengths; a comparison between actual states features and IS structure, for the sake of rising awareness about the fact that IS is not a state, but it might slowly become a real threat to the international system; an overview of IS global strategy, because the future of IS depends on its core heartlands as well as on the activities that IS affiliates are carrying out in other countries.