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1. Hezbollah Has a New Strategy to Survive Lebanon’s Financial Crisis

Author:
Hanin Ghaddar
Publication Date:
03-2020
Content Type:
Policy Brief
Institution:
The Washington Institute for Near East Policy
Abstract:
Unless Washington and its allies respond to the protestors’ legitimate demands for reform, the group will survive through measures such as expanding its smuggling activity, promoting its financial institutions, and selectively scapegoating corrupt politicians. When IMF officials visited Lebanon late last month amid its accelerating economic freefall, many wondered whether these developments might alter the behavior of Hezbollah, the designated terrorist group that has a deep financial stake in the country’s public and private sectors. During a previous funding crisis—the increase in U.S. sanctions against the group’s chief underwriter, Iran—the “Party of God” and its foreign sponsors formulated a new strategy to evade these measures and create alternative sources of funding. Such sources allowed Hezbollah to make further inroads into government agencies following the 2018 parliamentary elections. For example, the group’s leaders insisted on controlling the Health Ministry, which commands Lebanon’s fourth-largest budget at $338 million per year; they also gained more access to the Ministry of Public Works and Transport, the Agriculture Ministry, and the Ministry of Energy and Water, whose assistance was used to fund their affiliated projects and businesses. That worked until Lebanon’s own economy began its current nosedive. Unemployment has hit a record high of 40 percent, and the lira has slumped by about 60 percent on the parallel market, hiking inflation. Officially pegged to the dollar, the currency has plummeted 40 percent on the black market as local banks ration dollars necessary for imports of food, medicine, and other essential goods. Meanwhile, Lebanon has one of the highest debt-to-GDP ratios in the world (over 150 percent) and may not be able to pay $1.2 billion in Eurobonds this month. As with the Iran sanctions, however, Hezbollah has a strategy to survive this domestic pressure, at least in the near term.
Topic:
Foreign Policy, Corruption, Debt, Politics, Protests, and Hezbollah
Political Geography:
Middle East, Lebanon, and United States of America

2. Time to Change Course on the UN’s Lebanon Policy

Author:
Assaf Orion
Publication Date:
08-2019
Content Type:
Policy Brief
Institution:
The Washington Institute for Near East Policy
Abstract:
Serious change is required to avoid decisions that accommodate Hezbollah’s ends, ways, and means, and a vital first step is to look at current policy mechanics with a clear eye. With this month marking the thirteenth anniversary of UN Security Council Resolution 1701 and the end of the 2006 Lebanon war, the council will soon hold its yearly debates about renewing the mandate of the UN Interim Force in Lebanon. Contrasting the Secretary General’s latest report on 1701 with thirteen years of lessons learned reveals a clear pattern: the victory of consciously false hopes over hard experience, particularly when viewed from Israel’s perspective. Breaking this pattern will require substantial changes to the force’s size, mission, and conduct.
Topic:
Conflict Prevention, Foreign Policy, United Nations, Governance, and Hezbollah
Political Geography:
Middle East, Lebanon, and United States of America

3. Hiding in Plain Sight: Hezbollah's Campaign Against UNIFIL

Author:
Assaf Orion
Publication Date:
11-2019
Content Type:
Policy Brief
Institution:
The Washington Institute for Near East Policy
Abstract:
The Second Lebanon War, between Israel and Lebanese Hezbollah, ended August 14, 2006. Since that summer, populations on both sides of the Israel-Lebanon border have enjoyed the longest calm in their troubled history, thirteen years and counting. Mandated by United Nations Security Council Resolution 1701, the UN Interim Force in Lebanon (UNIFIL), an entity first established in the late 1970s, was expanded, and its 10,500 peacekeepers are busy and visible. UN reports over the past thirteen years emphasize the general calm. But calm does not mean safe and secure. During the war, Hezbollah launched approximately four thousand rockets out of its arsenal of twelve thousand toward Israel. Since the war, Iran has invested billions of dollars in building its Lebanese proxy military force throughout Lebanon, including in the south.
Topic:
United Nations, Peacekeeping, Conflict, and Hezbollah
Political Geography:
Middle East, Israel, and Lebanon

4. Hezbollah Prioritizes Its Own Interests, Putting Lebanon at Risk

Author:
Matthew Levitt
Publication Date:
10-2019
Content Type:
Policy Brief
Institution:
The Washington Institute for Near East Policy
Abstract:
As demonstrators rail against economic problems, corruption, and sectarianism, the group’s role in undermining the public’s financial and physical security is coming under greater scrutiny. Lebanese citizens took to the streets this weekend to protest the country’s acute financial crisis, which has been marked by one of the highest debt ratios in the world, a new currency crisis, and fears that a strike will close gas stations indefinitely. Many believe that deep-rooted corruption and sectarianism got them into this mess, and may now complicate efforts to get them out. Against this backdrop, more criticism is being directed at Hezbollah, the widely designated terrorist organization that is simultaneously the most powerful party in Lebanon’s government and an aggressively sectarian movement that keeps its activities and weapons outside the government’s control. As the Treasury Department recently noted, developments over the past few weeks have underscored the extent to which the group’s actions “prioritize its interests, and those of its chief sponsor, Iran, over the welfare of Lebanese citizens and Lebanon’s economy.”
Topic:
Foreign Policy, Corruption, Financial Crisis, Protests, and Hezbollah
Political Geography:
Middle East and Lebanon