Hezbollah, Iran preventing Lebanese recovery: Expert

Hezbollah, Iran preventing Lebanese recovery: Expert
Members of the Iran-backed Hezbollah militia march in Srifa, Lebanon, during a funeral one of their commanders killed in battle in 2016. (Shutterstock photo)
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Updated 07 November 2020

Hezbollah, Iran preventing Lebanese recovery: Expert

Hezbollah, Iran preventing Lebanese recovery: Expert
  • Panel discussion highlights political intransigence, economic mismanagement as obstacles to reform

LONDON: Hezbollah and Iran are preventing Lebanon from enacting badly needed reforms to emerge from political, social and financial crises, Ziad Majed, associate professor and program coordinator for Middle East pluralities at the American University of Paris, said on Friday.

Iran “is contributing to conflicts in the region, thus opening Lebanon as a theater to many of the terrible events of the region,” Majed said during a virtual panel discussion organized by the Council for Arab-British Understanding and attended by Arab News.

Alia Moubayed, a financial analyst, said the dysfunctional political system has contributed to Lebanon’s financial issues.

“The existential nature of (this) crisis stems from the fact that it’s a multipronged crisis. It’s a balance-of-payments crisis … It’s also a debt crisis. Lebanon’s debt has been above 140 percent for decades, and most recently it has just continued to edge up. We got to a point where this debt became increasingly unsustainable, leading to basically a debt default,” she added.

“It’s also a banking crisis. The banking system was attracting capital from abroad and offering exorbitant returns at risk of not being paid, to the extent that up to 75 percent of the assets of banks were exposed to the sovereign and Central Bank risk. All the money in dollars amounted to more $120 billion; the Central Bank, not being able to print dollars, was unable to give (funds) back.”

Moubayed said this is having serious social impacts on ordinary Lebanese. “Per capita income more than halved in less than a year. Almost 80 percent of the value of the currency has been lost,” she added.

“This obviously led to hyperinflation — more than 120 percent. That’s really wiping out the savings of Lebanese (people) but also undermining many livelihoods, particularly for the poor. Poverty rates exceed 50 percent, compared to 37 percent in 2019.

“There was also the horrible explosion that happened at the heart of the Beirut port, which deepened contraction of GDP (gross domestic product). The economy is really reeling.”

Ziad Abdel Samad, executive director of the Arab NGO Network for Development, said the Aug. 4 blast was a pivotal moment for the country — symbolic as well as material.

“The Beirut blast … was the manifestation of the government’s failure. Both corruption and negligence disabled the main agencies from doing their jobs properly,” he added.

Moubayed said: “We find ourselves with a lack of willingness, competence and … ability to move the country on a virtuous path. It’s being thwarted by the political elite because somebody has to bear the brunt of these losses. That means those who benefited for most of this time … are now trying to avoid this overhaul.”

Majed agreed, saying: “In this kind of configuration, it’s extremely difficult to modify electoral law, to modify the concept of the power-sharing formula, and to talk about a citizenship that’s capable, through its creativity and activism, to reconstruct a new Lebanon or political system.” 

He added: “If you combine with that the whole financial management or all the economic crises and the current terrible situation, you have a country that’s just pushing some of its people to leave, and that’s terrible.” 

Abdel Samad, though, suggested a complete rethink of social and economic approaches in Lebanon, based on “creating a big coalition” to “adopt an urgent reform agenda” and “recover the state and stolen assets” from the political elite.

“It’s easy to see the collapse of Lebanon will create serious threats to the region. Lebanon is hosting more than 1 million Syrian refugees and around 500,000 officially registered Palestinian refugees,” he said.

“It’s important to underline that any external pressure and functions can help, but won’t have the expected result unless they rely on a strong local movement able to break the status quo and lead the nation to real changes.”

Moubayed said if political change happens, a roadmap exists to solve Lebanon’s financial issues.

“We need a capital control law that would reduce the leakages out of the system. Another immediate action would be a rationalization of the costly subsidy system that isn’t benefitting those who need it,” she added.

“In addition to these measures, we need to approach the crisis in a comprehensive way — solid debt restructuring that would address the unsustainability of public finances.

“The second pillar of the approach would be the restructuring of the banking system in order to put back the financial sector to its right size, because it’s clearly an oversized system that the society and economy can’t sustain, but also (there would need to be) stronger regulation.

“The third (pillar) would be a strong social protection system that Lebanon has been lacking. Clearly the whole structure of governance (needs) reform. I don’t think Lebanese citizens are willing to undergo more pain if we don’t establish a system of good governance based on an independent judiciary … strong accountability (and) transparency.”


Lebanese protesters break lockdown: ‘Death by COVID-19 is better than starvation’

Lebanese protesters break lockdown: ‘Death by COVID-19 is better than starvation’
Updated 14 min 29 sec ago

Lebanese protesters break lockdown: ‘Death by COVID-19 is better than starvation’

Lebanese protesters break lockdown: ‘Death by COVID-19 is better than starvation’
  • Hundreds of people took to the streets in Tripoli, Sidon, and Beirut to denounce the suspension of the economy

BEIRUT: The closure and curfew period in Lebanon has been extended for two more weeks to contain the spread of the coronavirus disease (COVID-19), prompting people in Tripoli, Beirut, and Sidon to take to the streets.

The protests were spontaneous, considering that the neighborhoods from which they started are poor, where the residents work for daily wages.

The Minister of Social Affairs and Tourism in the caretaker government Ramzi Musharrafieh said on Tuesday that “230,000 families in Lebanon benefit from aid and have been receiving 400,000 Lebanese pounds ($263) per month since the beginning of the crisis.” He added that “25 percent of the Lebanese people do not need aid.”

Hundreds of people took to the streets in Tripoli, Sidon, and Beirut to denounce the suspension of the economy and the failure to provide people with alternatives.

One of the protesters said: “Contracting COVID-19 and dying of it is easier than having my family and myself starve to death.”

Protesters in Tripoli took to Al-Nour Square on Monday after days of expressing their impatience and protesting outside the houses of the city’s officials.

One of the protesters said: “COVID-19 does not scare us. We cannot tolerate this life of humiliation anymore. The officials in power have starved and robbed us.”

The protesters clashed with the security forces — the army and the Internal Security Forces — hurling stones and water bottles at them. 

Their chants demanded financial compensation for the poorest families, who have not been able to work for two weeks and must wait a further two weeks before they can return to their jobs, resulting in a whole month without any financial income.

The protests spiralled out of control and turned into riots that ended with dozens of arrests. Several army personnel were deployed to control the situation in Al-Nour Square and its vicinity. Riot police used tear gas to disperse the protesters.

The Lebanese Red Cross said it brought in six ambulances as 41 people were injured during the protests. The organization transferred 12 people to hospitals, while 29 were treated at the scene.

In support of the Tripoli protests, dozens gathered at the Ring Bridge in central Beirut.

Activists gathered in Sidon’s Elia Square for a vigil, amid security measures. The protesters chanted slogans denouncing the political authority’s arbitrary decisions, which they argue worsened the economic collapse. 

Some protesters said that 60 percent of the poor people in Lebanon are suffering because of these decisions, which were not accompanied with support for people who were laid off due to lockdown measures.

The protests extended to Taalbaya in the Bekaa and the coastal town of Jiyeh. The protesters moved from the poor neighborhoods of Beirut to Corniche el Mazraa and blocked the road, but the riot police reopened it.

Bechara Al-Asmar, head of the General Labor Union, told Arab News: “Things are heading toward chaos, and the authorities’ decisions are ill-considered. When forcing people to stop working, it is important to give them incentives and compensation. There are 120,000 daily workers impacted by the closure, which has come amid a severe economic crisis.”

He added: “They must exempt the factories that suspended production so that they can survive and not lay off their workers if the closure results in stopping operation. 

“What can the factories that have agreements with clients abroad do to deliver their products? This is the only sector that is bringing Lebanon fresh money and giving people jobs.”

Al-Asmar said that aid provided by the government “covers 47,000 families, and a further 8,000 taxi drivers have been added to them. This is a small percentage compared to the need among the general population.”

He continued: “Employees are now receiving half a salary or a very meager salary if they don’t lose their jobs as employers prefer shutting down their businesses to continuous losses.”

Bechara added: “We are facing a major social crisis. The daily workers are complaining of their inability to put bread on the table, while the state is unable to hold coordination meetings, so how can it provide compensation for those affected?”