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World News /21 Oct 2019
10.21.19

Does the Lebanese Government Have the ‘Courage’ to Make the Right Decisions?

On my visit to Lebanon several weeks before the current demonstrations began, two Lebanese leaders, one a minister and the other a parliamentarian, described the mood of the Lebanese people and noted the lack of courage by Lebanese government officials, one admitting, “We do not have the courage to address our problems.”

That comment now appears prescient as Lebanon’s crisis is about more than Syrian refugees, who with existing Palestinian refugees and other immigrants, make up at least one-third of the population. This presence adds to the existing pressure on government services, unemployment and underemployment, infrastructure overload, environmental damage, and increased crime. And the government has no national strategy to effectively addresses these concerns.

Nearly daily, Israel threatens to intervene militarily in Lebanon against the Iranian-backed Hezbollah. Israeli jets and drones conduct illegal overflights of Lebanon, while Hezbollah threatens to wreak havoc inside Israel. One miscalculation by either side could lead to a catastrophic war. One almost occurred a month ago when Israel sent drones to the Hezbollah stronghold in the southern suburbs of Beirut; another in December, when Israel first discovered tunnels dug by Hezbollah from Lebanon into Israel.

However, the Israeli military threat and the refugee crisis are not taking up most of the attention of the Lebanese these days. It’s their economy and people from all over the country and across all sectarian groups are demonstrating in the streets.

They have many reasons to demonstrate. Economic growth could be in negative territory in 2019; bond agencies have rated Lebanese bonds as “deep junk;” unemployment and poverty are on the rise; and the government has little in the way of resources and management to address the country’s socio-economic problems. The Central Bank of Lebanon has enacted monetary policies to maintain the value of the Lebanese pound to prevent economic collapse, rampant inflation, and wage instability. But this cannot last without sound fiscal measures taken by the government. Adding to these pressures are the decrease of remittances and deposits from the Lebanese diaspora and the decline in significant deposits and foreign direct investment from Gulf countries, principally the UAE and Saudi Arabia, who have blocked their investments to Lebanon due to the Iranian influence on Hezbollah. In addition, the Syrian war has also cut off Lebanon from its only overland trade routes.

The U.S. has made its position clear by taking on Hezbollah by taking tough steps to weaken Hezbollah and Iran, sanctioning individuals and two banks in Lebanon, most recently, Jammal Trust. This affected 85,000 mostly innocent Shiite depositors who face challenges in retrieving and transferring their accounts. This is perceived by some as the U.S. targeting Lebanon’s Shiite community. The banking sector makes up 14% of the GDP of the country, and protecting this industry is a must if Lebanon is to recover.

There is a new U.S. Assistant Secretary of State for Near East Affairs and there will soon be a new U.S. Ambassador to Lebanon. These changes lead Lebanese officials to wonder if ongoing U.S. support will continue, especially regarding its negotiations on the Lebanon-Israel land and maritime borders, putting into question the future potential of natural gas development.

“It’s the perfect storm,” said one Lebanese official. Another remarked, “The U.S. wants us to be more aggressive with Hezbollah and in our economic policies. We have little room to maneuver,” adding, “We need breathing space…This is not our problem alone.” It is a problem involving outside actors much larger than Lebanon: Syria, Russia, Iran, Israel, Saudi Arabia, Turkey, and the United States. They have as much an effect on Lebanon as Lebanon’s internal actors.

As the U.S. has reduced its involvement in the Middle East, Russia sees an opportunity to fill the void and exert leadership. Russia claims to be a more dependable alternative, promising Lebanon and its neighbors increased trade, military equipment, and conflict mediation regarding Lebanon’s refugee repatriation. So far, Russia has shown little action and questionable capability, but this propaganda works at a time of U.S. regional retreat.

Despite Lebanon’s fears of abandonment, and in response to the legitimate concerns of the demonstrators, the U.S. can be helpful in many ways. For example, emphasizing its commitment to the sovereignty, independence, and stability of Lebanon, providing significant funding in direct military and foreign assistance, and continuing visits by senior diplomatic and military officials.

Time is running out however for the Lebanese government to show the courage to make the tough decisions necessary to right its economy. Thousands of Lebanese are demonstrating in the streets, expressing their frustration with a government that is failing to take decisive action on the economy.

The government has the power to make the needed changes, address its economic woes, and take control of its destiny. It has been offered $11 billion in soft loans and grants by international donors to rebuild infrastructure, kick-start the economy, and privatize government-run entities.

The international community however expects Lebanon to reduce its budget and public workforce, create transparent oversight mechanisms, and institute anti-corruption policies that will allow this beautiful country to reclaim its historic role as an economic model in the Middle East. The demonstrators are showing their concern and commitment to a more free, open, transparent, and inclusive Lebanon…will the politicians take up the challenge? All it takes is a little courage.

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