Political risk and political change are at pivotal points in today's Middle East. While Lebanon's ceasefire smoulders, Iran fumes and Iraq blazes with insurrection, forces of change promise a way out of the cycles of violence. Policymakers and investors must see their way through the worrying short-term risks to enjoy the long-term benefits that will be offered once political reform becomes entrenched.

Today's instability occurs at a time when there is progress on the political stage. Countries and markets have embarked on policies of reform. The election of female parliamentarians in Saudi Arabia and the first democratic elections in Kuwait show rulers and dynasties are trying harder to win mandates. Uphill efforts to introduce democracy in Iraq might even be shown, in hindsight, to fit with this trend. It may not be long before Israel's claim to be the only democratic Middle Eastern country, so much part of its argument for support, is challenged.