Why a man behind a Beirut bank holdup became the face of Lebanon’s painful financial collapse

Special Popular perception of hostage-taker as a national hero underscores the depth of Lebanese depair over its financial collapse. (AFP)
Popular perception of hostage-taker as a national hero underscores the depth of Lebanese depair over its financial collapse. (AFP)
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Updated 18 August 2022

Why a man behind a Beirut bank holdup became the face of Lebanon’s painful financial collapse

Why a man behind a Beirut bank holdup became the face of Lebanon’s painful financial collapse
  • While the world reels from rising food and fuel prices, Lebanese have long lived with hyperinflation and its effects
  • Move to release Bassam Hussein comes as no surprise after lawsuit is dropped against someone seen as a national hero

BEIRUT: The news that Lebanon’s attorney general on Tuesday released a man who stormed a bank in Beirut last week and took hostages would have scandalized the public in most countries. But Bassam Hussein was no ordinary hostage-taker and Lebanon is no ordinary country.

Hussein had reportedly held bank employees and customers at gunpoint on August 11 to demand his own money back. According to the National News Agency of Lebanon, when his request to withdraw part of his frozen savings of $210,000 to cover medical bills for his ailing father was denied, he threatened to torch the bank and kill everyone in it.

The attorney general’s decision came after the Federal Bank dropped its lawsuit against Hussein, who emerged as a national hero in a country where banks have subjected their customers to all manner of restrictions, including strict limits on savings withdrawals.

Hussein had targeted a bank but his act of desperation was viewed by many of his compatriots as emblematic of a much bigger rot.

Lebanon, a nation once described as the “Switzerland of the Middle East,” the darling of foreign investors, artists and intellectuals, has been reduced to a perpetually failing state, with the dubious honor of having an inflation rate that crossed the 200 percent mark this year.

Last week, The New York Times published a story comparing the rising inflation rate in the US — currently at 9 percent — to Argentina’s 90 percent. This is a country that in the 1980s saw its rate hit an “unbelievable” 3,000 percent. Citizens of the South American nation struggle to cope, using cash to pay for everything from buildings to coffee and store their money everywhere but the bank, the newspaper reported.

Similar to Argentina, Lebanon’s once-welcoming banks with revolving glass doors are now fortified with heavy metal and barbed wire for security, all of which are spray painted over with angry graffiti of desperate people denied access to their savings.

The crippling financial crisis that began in 2019, accompanied by a rapid devaluation of the national currency and runaway inflation, has pushed an unprecedented number of families in Lebanon below the poverty line.




Bread is one of the few subsidized food items in the country. (AFP)

An embodiment of this tragedy is Rachelle, a widow with a special-needs son, whose husband committed suicide two years ago following a long history of family quarrels over large sums of money lost as Lebanon’s economy unraveled.

Rachelle, a resident of Jounieh who did not want to give her last name, can only withdraw a maximum of $400 per month from her bank account. She is one of millions of Lebanese who cannot freely access their savings, because the funds were used by banks to pay unreasonably high interest rates to attract more deposits.

The banking crisis had an immediate effect on the Lebanese lira. The shortage of dollars in the currency market, the country defaulting on its Eurobond debt, and the resulting loss of faith in the stability of the local currency all contributed to the rapid devaluation of the lira.

The Lebanese currency has lost more than 90 percent of its value since 2019. As a result, people’s purchasing power has plummeted, multiple types of goods have disappeared from the shelves, prices have skyrocketed, and the country has been declared a “hunger” hotspot.

Almost 80 percent of the Lebanese population is now considered to be living below the poverty line after the imposition of informal capital controls.

INNUMBERS

* 6.7m Population in 2021.

* -.08% Annual population growth (2021).

* 150k Net migration (2017)

Source: World Bank

A recent World Bank report labeled the financial meltdown as “deliberate” and one of the worst economic crises in modern times.

Rachelle now survives on small amounts of money sent by her family and in-laws from abroad, in addition to food stamps and parcels distributed by local NGOs.

“I cannot pay my bills; I live in constant fear and anxiety that I will be thrown out of my house. I have diabetes and I am close to giving up altogether as I can barely afford my medication,” she told Arab News.

Like her, millions of Lebanese are unable these days to buy medicines, which are entirely imported from abroad, leading to spikes in prices every time the lira depreciates.

Lebanon has been plagued by corruption for decades, a situation that benefits those well connected to the political elite at the expense of everyone else. The 2019 economic meltdown resulted in the near total disappearance of the middle class — who have now become the working poor.

“Before the crisis, we had some kind of a middle class. The result of the inflation led to a lot of people becoming poor or falling under the poverty line,” Mohamad Faour, a professor of finance at the American University of Beirut, told Arab News.

“Whatever was in the middle has ceased to exist,” he said, referring to the deepening economic inequality in Lebanon. “We have a new class of nouveau riche whose income is in dollars, but even their condition is not quite stable.”




Protesters march against Lebanon's draft capital control law in April this year. (AFP)

The problem of sky-high inflation is compounded by a fluctuating currency exchange rate, which can go from 20,000 lira to one dollar to 30,000 in one week, making financial planning impossible.

To make matters worse, even when the lira appreciates — mostly due to dollar injections into the market by the central bank — prices rarely go down.

Elie, an unemployed Lebanese university graduate who lives in Beirut, told Arab News: “I’ve somewhat become used to uncontrollable price changes, and ever since the crisis began, I’ve started compromising with several things and checking prices of any item I buy.”

He added: “What still surprises me is that there is absolutely no price control, and the same item on the same day can be found with several drastically different prices in different shops.”

Faour says this anomaly is a legitimate grievance, but explains that it is not unique to Lebanon. “This happens to all countries facing currency (crises),” he told Arab News.




Lebanon, a nation once described as the “Switzerland of the Middle East,” the darling of foreign investors, artists and intellectuals, has been reduced to a perpetually failing state. (AFP)

“The value of goods and currency are based on expectations and in Lebanon the situation is chaotic and the general sentiment is negative. But we also can’t neglect the big exploitative element of many importers who are profiting off margins due to uncertainty.” 

Political and bureaucratic mismanagement and inaction are seen as contributing factors in the runaway inflation. Faour says reasonable reforms proposed by the International Monetary Fund have inevitably been sabotaged by politically connected bankers and politicians.

All the traditional parties and politicians ruling Lebanon have played a role in leading the country into the abyss, he says.

“You have a power-sharing agreement that isn’t enabling any decision-making. We have to address the problems head-on, which is very hard because it means facing off with the bank owners who will be taking a big part of the hit due to their reckless lending decisions,” he said.

“We have to be able to tell depositors what they’ve lost and what they can still have. We need a safety net to make the descent less painful. The stabilization, unfortunately, will entail unpopular decisions.”

While the volume of the Lebanese lira in the market has increased significantly since the beginning of the financial crisis, this is not what is at the heart of the problem, according to Faour.




An all too familiar sight in Lebanon, as people wait for hours in cars to get fuel at a gas station in Zalka. (AFP file photo)

“Public misconception is that inflation is because the government is printing too much money, but that’s not the case,” he told Arab News.

“It’s the result of the exchange rate collapse and the government fiscal policy which has been characterized by austerity.”

Pointing out that “public salaries are still at the original 1,500 lira rate,” he said. “The government is actually not spending enough money; the fiscal deficit has dropped dramatically.”

To the people of Lebanon, this abrupt economic decline means more than just numbers on a graph. The growing inability to secure even their basic needs has taken its toll on the mental health of the Lebanese.

“People around are, at least partly, in clear denial,” Elie, the unemployed graduate, told Arab News, speaking philosophically.

“Everybody right now would say that they have become used to the dramatic changes of everyday life compared with just a few years ago and that ‘it could have been worse.’

“But deep down they know that it really couldn’t, that all aspects of life at times appear unbearable and psychologically exhausting.”

 


Anger in Paris over Iran ‘spy’ charges

Anger in Paris over Iran ‘spy’ charges
Updated 07 October 2022

Anger in Paris over Iran ‘spy’ charges

Anger in Paris over Iran ‘spy’ charges
  • French schoolteachers’ union official Cecile Kohler and her partner Jacques Paris were arrested in May on charges of fomenting “insecurity” in Iran
  • France condemned the arrests and allegedly forced confessions, in which Kohler said on video that she was sent by France to spark a revolution

JEDDAH: France on Thursday accused the regime in Iran of taking two of its citizens hostage after Tehran broadcast video footage of the couple making forced confessions to being spies.

French schoolteachers’ union official Cecile Kohler and her partner Jacques Paris were arrested in May on charges of fomenting “insecurity” in Iran. France condemned the arrests and demanded their immediate release.

In Thursday’s TV footage Kohler “confessed” to being an agent of the French external intelligence service, in Iran to “prepare the ground for the revolution and the overthrow of the regime of Islamic Iran.” Paris said: “Our goal at the French security service is to pressure the government of Iran.”

The video sparked anger in France. “The staging of their alleged confessions is outrageous, appalling, unacceptable and contrary to international law,” foreign ministry spokeswoman Anne-Claire Legendre said.

“This masquerade reveals the contempt for human dignity that characterizes the Iranian authorities. These alleged confessions extracted under duress have no basis, nor did the reasons given for their arbitrary arrest.”

The French couple's appearance on TV coincides with weeks of anti-government protests in Iran over the death last month in morality police custody of 22-year-old Mahsa Amini. It also came a day after a debate in the French senate in which all political parties condemned Iran's crackdown on the protests.

Rights groups say Iranian state media broadcast more than 350 forced confessions between 2010 and 2020. Four French citizens are in jail in Iran and France is assessing whether another one may have been arrested during the current protests.

In a tweet on Oct. 5, the Human Rights Activists in Iran and 19 other human rights organizations asked US President Joe Biden in an open letter "to address the Iranian regime’s violent crackdown on the Mahsa Amini protests and Iran’s ongoing human rights crisis."

"The Iranian people need the support of the United States and the entire international community to attain their rights and freedoms," the letter said. 


Arabs view access to water as most pressing environmental issue, survey finds

Arabs view access to water as most pressing environmental issue, survey finds
Updated 07 October 2022

Arabs view access to water as most pressing environmental issue, survey finds

Arabs view access to water as most pressing environmental issue, survey finds
  • The Arab Barometer interviewed 26,000 citizens between October 2021 and July 2022 in 12 countries that represent about 80 percent of the Arab world
  • Despite broad concerns about climate change and the environment, the survey found many in the region consider other issues to be higher priority

WASHINGTON: Arabs believe the climate change-related threat to water resources is the biggest environmental issue facing the region and its people.

This was a key finding of the latest Arab Barometer Report on the attitudes in 12 Arab countries about the environment, which was published on Thursday.

The Arab Barometer is a research network that gathers opinion and offers insights into the social, political and economic attitudes of citizens across the region.

Its latest survey on the environment found that the majority of the people it polled were concerned about the availability of drinking water, the pollution of water sources, and the quality of the air in their communities.

Tunisia had the highest proportion of people who considered availability and quality of water the biggest environmental challenge facing their country, at 60 percent, followed by Algeria with 50 percent, and Iraq, Palestine and Libya with 47 percent.

The findings are part of the seventh round of polling by Arab Barometer, which has been tracking the views of people in the Middle East and North Africa since 2006. It describes itself as the largest publicly available survey of the opinions and attitudes of citizens across the region.

For its latest report, it interviewed 26,000 citizens between October 2021 and July 2022 in 12 countries that represent about 80 percent of the Arab world: Algeria, Tunisia, Libya, Morocco, Mauritania, Jordan, Lebanon, Palestine, Iraq, Egypt, Sudan and Kuwait. In addition to the environment, other parts of the survey covered political, social and economic issues.

Issues related to waste management ranked second among the key environmental issues people in region are most concerned about. Recycling is already an important environmental-protection activity in many countries and the survey found that many people in the region already recycle their waste, but that they do so mostly for “cost-saving” benefits or “convenience, rather than to protect the environment.”

Educational background tended to affect people’s views on environmental issues such as climate change, air quality, pollution and trash, with those who were better-educated expressing greater concern about them.

In addition, issues related to climate change were more of a concern among people living in rural location than those in urban areas.

Aside from the availability and quality of water and its quality, other attitudes toward the environment varied.

A previous survey, in October 2020, found that less than than seven percent of citizens in Arab countries believed that reducing pollution should be the top priority of government spending in the coming year. In research carried out in the spring of 2021, less than nine percent said that foreign aid should be used to address environmental concerns.

In the latest poll, less than five percent of people surveyed in the majority of Arab countries said foreign aid donated to their nations should be used to tackle climate change and environmental challenges. In Egypt, Jordan and Palestine, the figure was as low as 1 percent.

Yet the research also found that citizens of the region blame themselves for not being proactive enough on environmental issues, and their governments for failing to take action to properly address climate change and environmental challenges in their communities.

They expressed high levels of support for their governments to take action to tackle environmental issues. But despite broad concerns about climate change and the environment, the study found most people in the region view other issues as being more urgent and of higher priority.


Alexandria Film Festival pays tribute to departed performers

Alexandria Film Festival pays tribute to departed performers
Updated 07 October 2022

Alexandria Film Festival pays tribute to departed performers

Alexandria Film Festival pays tribute to departed performers
  • Festival management remembered Egyptian stars who passed away in 2022 by showing a video clip during the opening ceremony

CAIRO: The 38th session of the Alexandria Film Festival for Mediterranean Countries has opened at the Bibliotheca Alexandrina.

It is named after the artist Mahmoud Hemida.

Festival management remembered Egyptian stars who passed away in 2022 by showing a video clip during the opening ceremony.

Famous names included Hisham Selim, Maha Abu Auf, Samir Ghanem, Dalal Abdel Aziz, Ahdi Sadiq, Ali Abdel Khaleq, Ahmed Halawa, and Aida Abdel Aziz.

Film critic Amir Abaza, who has a leading role in organizing the event, told Arab News: “We chose to name the festival in the star Mahmoud Hemida’s name because he is of a great cinematic stature who has presented a large number of important works.”

Hemida has also reinvested profits into cinema, as well as participating in the production of a number of films without looking for profit, added Abaza.

The festival also honored a number of art stars, namely director Mohamed Abdelaziz, actress Donia Samir Ghanem, director Saeed Hamed and producer Wajih El-Leithi.

Radio broadcaster Imam Omar was also honored the King of Comedy Medal went to the late Samir Ghanem and Dalal Abdel Aziz.

The festival also honored the Greek star Alexis Protopsalti, the French artist Marianne Borgo, and the Armenian-Egyptian star Nora Armani.

A movie called “Barsoum Looking for a Job” — produced in 1923 and directed by Mohamed Bayoumi — was played at the end of the ceremony.

A publication on the 100 most important comic films in Egypt was among a number of books released on the sidelines of the festival.

However, the inclusion of non-comic films such as “Between Heaven and Earth” by Salah Abu Seif created some controversy and some questioned the lack of high-level comedy movies such as “Kit Kat” by Daoud Abdel Sayed and “Umm Ratiba,” directed by Alsayed Badir.

Critics also highlighted the absence of any Mohamed Sobhi flicks, one of the biggest comedy stars in Egypt.

Adel Imam topped the poll as best actor, Shwikar as best actress, Fatin Abdel Wahab as best director, and Abu Al-Saud Al-Ibiari as best author. Thirty-two film critics and researchers participated in the poll.


Turkey, Israel ties warm with naming of ambassador

Turkey, Israel ties warm with naming of ambassador
Updated 06 October 2022

Turkey, Israel ties warm with naming of ambassador

Turkey, Israel ties warm with naming of ambassador
  • Ankara appoints new envoy 4 years after last was expelled
  • Ambassador knows region, has experience: Analyst

ANKARA: Turkey has appointed a new ambassador to Israel, as both countries move to end four years in the diplomatic wilderness.

Sakir Ozkan Torunlar has been named to fill the role left empty after the two regional powers expelled each other’s ambassadors in 2018 in a row over the killing of 60 Palestinians by Israeli forces during protests on the Gaza border.

His appointment comes weeks after Israel named career diplomat Irit Lillian as its new ambassador to Turkey. President Recep Tayyip Erdogan was also expected in the coming months to reciprocate a March visit to Ankara by his Israeli counterpart, Isaac Herzog.

Contrary to expectations, Torunlar is not a political appointee and is an experienced career diplomat. He was consul-general in Jerusalem and ambassador to Palestine between 2010 and 2014, and was awarded the Order of the Jerusalem Star by Palestinian President Mahmoud Abbas.

Israel is expected to endorse Torunlar’s appointment.

Selin Nasi, a non-resident scholar in Eliamep’s Turkey Program, said that Ankara’s choice was positive for Israel.

“Previously, the foreign ministry was planning to appoint Turkey’s pro-government SETA Foundation foreign policy director, Ufuk Ulutas,” she said, who she added was seen in Israel as a “controversial figure” for his “anti-Israeli views” and lacked diplomatic experience.

Upcoming domestic elections in both countries had accelerated the reconciliation process, she said.

“Given the upcoming parliamentary elections in November, the Israeli side in a way tried to consolidate the process by naming its ambassador in advance, preventing possible interference of domestic politics,” she told Arab News.

“Turkey has also entered the election season. The government is trying to balance domestic concerns with its commitment to restoring ties with Israel,” said Nasi.

Experts say that Turkey and Israel want to deepen their cooperation in tourism, energy, agriculture, water technology, trade and defense.
 

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Nasi said defense cooperation had ground to a halt after the Mavi Marmara incident of 2010, when Israeli commandos stormed a Turkish aid ship headed to Gaza as part of a “freedom flotilla.” Nine crew members died in the attack.

“The docking of the Turkish frigate Kemalreis at Haifa port on the sidelines of a NATO drill for the first time since the Mavi Marmara, indicates a possible thaw in this area as well. It will take time to repair broken trust,” she said.

Both countries’ opposition to the Iranian regime is also expected to push Turkey and Israel closer, she added.

“More importantly, as two militarily strong actors in the region, these two countries have the power to shift the balances on the ground when they cooperate.”

However, Nasi warned that Turkey’s ties with Hamas would be closely monitored by Israel and that domestic politics “may still interfere in the normalization process.”

According to an annual public opinion poll by the Mitvim Institute, an Israeli foreign policy think tank, 72 percent of respondents wanted strengthened relations with Turkey. The figure was up 12 percentage points on the poll last year.

Gallia Lindenstrauss, a senior research fellow at the Institute for National Security Studies in Israel, said the choice of career diplomats by both sides was a good start to better relations as careful and skillful diplomacy was needed.

“There are a few challenges ahead: Elections in Israel, growing tensions in the West Bank, elections in Turkey.”

However, she said that a decision earlier this year to discuss an update to a 1996 free trade agreement was “a good opportunity to see where to expand the already flourishing trade relations between the countries.”

Turkey’s resumption of full diplomatic ties with Israel could also improve Ankara’s image in Washington, which has been damaged by its arms deals with Russia and squabbles in NATO.

The rapprochement is also expected to boost the Turkish tourism industry, Lindenstrauss added. “Israeli tourists are once again flocking to Turkey and we will soon see the return of Israeli airlines to Turkey,” she said.


UAE president thanks education workers in World Teachers’ Day speech

UAE president thanks education workers in World Teachers’ Day speech
Updated 06 October 2022

UAE president thanks education workers in World Teachers’ Day speech

UAE president thanks education workers in World Teachers’ Day speech
  • Sheikh Abdullah bin Zayed underscored teachers’ role in fostering generations that are proud of their values and identity

ABU DHABI: The UAE President Sheikh Mohammed Bin Zayed has thanked teachers in a statement on “World Teachers’ Day,” where he outlined the Emirati roadmap for improving the education sector.
Sheikh Abdullah bin Zayed, the UAE’s minister of foreign affairs and international cooperation and chairman of the Education and Human Resources Council, said the statement on Thursday illuminated the UAE’s commitment to teachers.
Sheikh Abdullah thanked all teachers on the occasion, expressing the UAE’s gratitude for their efforts to ensure that children receive a top-quality education, the Emirates News Agency (WAM) reported.
Noting that educators played a key role in accelerating recovery across the educational sector, Sheikh Abdullah highlighted the great responsibility they bear and their dedication to educate children and youth in the UAE, especially throughout and after the COVID-19 pandemic.
He underscored teachers’ role in fostering generations that are proud of their values and identity, noting that teachers prepare them with the skills and knowledge required to drive development across society and pave the way for a brighter tomorrow.
The minister added that education is crucial for accelerating sustainable development across all sectors. He said that the UAE’s celebration of World Teachers’ Day is an expression of the pride it has in its educators.
Sheikh Abdullah said the education sector has seen a major shift over the past five decades, making great strides in developing and improving its outputs.