BEIRUT, Lebanon, 19 September 2006 — The rush to rebuild this war-crushed country has gotten tangled up with a high-stakes sectarian competition, as Arab governments in the region race against Iran and its ally Hezbollah to prove political clout and capture grass-roots loyalty, analysts say.

A steady stream of foreign delegations crunch over the rubble of the southern suburbs for photo opportunities; spokespeople churn out competing news releases; catty remarks fly between Hezbollah and the Lebanese government. Milk trucks on remote farm roads near the Israeli border proclaim that their boxed milk is a gift from the Gulf people; an Iranian flag emblazons water tanks in Beirut.

For decades, Lebanon has been an oft-abused host to its neighbors — a sun-warmed playground for the wealthy, but also a proxy battlefield for tensions that wash over the Middle East. In the current struggle, the region’s power players jockey not with guns, but with charity dollars, boxed food and showy displays of compassion.

“There’s a kind of competition between the Arab governments and Iran,” said Kamel Mohanna, general coordinator for Arab NGOs Forum. “It’s a competition to have political influence here ... to decrease the influence of Iran, to show that not only Iran has sent money to this area.”

The unmistakable sense of one-upmanship is a stark reminder of the panic that has gripped the region as the power of Iran swells. Animosities between Sunnis and Shiites stretch back into the origins of Islam, and have sharpened in recent years as the Arab states of the Gulf compete for influence against Iran. Sunni Arabs watched with increasing unease as Iranian influence spread among Shiites in post-invasion Iraq, and sat by nervously while Tehran, the Iranian capital, squared off against the West over its controversial nuclear program.

This summer’s war in Lebanon upped the ante even more. The perception that Hezbollah guerrillas drove Israel out of Lebanon has swept the coffee shops and streets of the Arab world. Hezbollah chief Hassan Nasrallah has been lionized, even among Sunni Arabs who previously might have viewed him with suspicion as a Shiite, analysts say.

As soon as the bombing stopped, Hezbollah foot soldiers waded into devastated streets and handed bundles of cash to families who’d lost their homes to Israeli bombing. Hezbollah has been coy about its ties to Iran, but the bulk of the cash is presumed to have come from Tehran.

The Lebanese government, dominated by Sunnis and Christians, has struggled to counteract the perception that Hezbollah is monopolizing the aid and reconstruction efforts.

“Iran may be trying to come into play here, saying, ‘Hey, we’re not bad guys, we’re benevolent,”’ said Mohammed Mamlouk, who is in charge of coordinating foreign aid for the prime minister’s office. “But they’re not fooling anybody. I bet even the Shiites here know better.”