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DW, 10 July 2016

The self-style "Islamic State" has lost territory equivalent to the size of Belgium over the past 18 months, a UK think tank has said. But the report warns the group is refocusing on mass attacks outside its territory.

The "Islamic State" (IS) lost 30,500 square kilometers (11,700 square miles) since last year, IHS, a security think tank in the UK, announced on Sunday.

That's the good news. The bad news is that this may cause the international jihadis to redouble focus on planning "mass casualty attacks" in other countries.

"As the Islamic State's caliphate shrinks and it becomes increasingly clear that its governance project is failing, the group is reprioritizing insurgency," IHS senior analyst Columb Strack said. "As a result, we, unfortunately, expect an increase in mass casualty attacks and sabotage of economic infrastructure, across Iraq and Syria, and further afield, including Europe."

The Iraqi military's recapture of Fallujah, an IS stronghold just west of Baghdad, last month and its continued assaults on Mosul has led the insurgents to step up bombings on Shiite Muslim targets, the latest attack in Baghdad killing nearly 300 people.

In Syria, the militants lost ground this year to both Russian and Iranian-backed forces supporting President Bashar al-Assad and to the US-backed Syria Democratic Forces (SDF) alliance.

The US Defense Department said in May that IS had lost some 45 percent of the territory it held in Iraq and between 16 percent and 20 percent of its territory in Syria.

IS has also seen its revenues drop from around $80 million (72.4 million euros) a month in mid-2015 to $56 million a month by March 2016, IHS reported.

"This figure has probably continued to decrease since March by at least another 35 percent," IHS analyst Ludovico Carlino said.

Meanwhile, an SDF advance is underway to retake areas north of Islamic State's de facto capital in Syria, Raqqa.

But even faced with growing territorial losses, the group has now shifted from itself previous triumphal tone boasting of its victories and the establishment of its vision of Islamic rule.

IS spokesman Abu Mohammed al-Adnani said in May the group would not be defeated even if its enemies took Mosul, Sirte, or Raqqa, its main strongholds in Iraq, Libya and Syria respectively.

"True defeat is the loss of willpower and desire to fight," al-Adnani said.