Lifeless Lebanon lurches into new turmoil amid worsening economic crises

Olivier De Schutter, UN special rapporteur on extreme poverty and human rights gestures during an interview with Reuters, in Beirut on Thursday. (Reuters)
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Updated 12 November 2021

Lifeless Lebanon lurches into new turmoil amid worsening economic crises

  • ‘Destruction of Lebanese pound has devastated lives and impoverished millions,’ says UN poverty rapporteur
  • Lebanon could ‘suffocate’ amid mix of Gulf political disaster and economic catastrophe, economist tells Arab News

BEIRUT: Lebanon continued its freefall into economic turmoil on Friday, with the medical, fuel, and food crises worsening and no political initiative being taken to overcome the deteriorating situation.

The value of the Lebanese pound dropped to record lows, trading at 23,000 Lebanese pounds to the dollar on the black market.

This crash was at least partly due to a speech given by Hezbollah Secretary-General Hassan Nasrallah on Thursday evening, in which he reaffirmed his hostile positions toward Saudi Arabia and called on the Lebanese to have “patience,” offering no solutions to their mounting problems.

Fuel prices suddenly shot up on Friday. The price of a 20-liter gasoline canister ranged between 310,800 and 319,600 Lebanese pounds, the price of a diesel canister reached 311,000 pounds, and gas cylinders were selling for 266,000 pounds.

The average price of fuel is now equivalent to half of the minimum wage.

Gas station owners reported an approximately 50 percent “decline in the sale of fuel.”

Meanwhile, Economy Minister Amin Salam on Thursday decided to reduce the weight of a bundle of bread while maintaining its current price, which is the highest it has ever reached.

A 1,050-gram bundle is now sold for 9,500 Lebanese pounds.

The Ministry of Economy attributed this to “the high prices of flour, diesel and other materials.”

Olivier de Schutter, the UN special rapporteur on extreme poverty and human rights, issued a statement following a 12-day mission to study poverty in Lebanon, a copy of which Arab News obtained from the UN office in Beirut.

“The Lebanese authorities’ destruction of the national currency, political deadlock, and reinforcement of long-standing inequalities have plunged the country into abject poverty,” he said in the report.

“Lebanon is not a failed state yet, but it is a failing state, with a government failing its population,” he added.

“The destruction of the Lebanese pound has devastated lives and impoverished millions.”

De Schutter described the crisis in Lebanon as “manufactured.”

He added: “While the population is trying to survive day-to-day, the government wastes precious time evading accountability and scapegoating refugees from the comfort of their offices.

“This outrageous level of inequality is furthered by a tax system that rewards the banking sector, encourages tax evasion and concentrates wealth in the hands of the few. In the meantime, the population is subject to regressive taxes that hit the poorest most.

“This is a human-made disaster that was long in the making.”

De Schutter expressed his concern that the “political leadership seems unwilling to see the relationship between tax reform and poverty alleviation and underestimates the benefits of social protection systems for rebuilding the economy, especially in times of crisis.

“Unfortunately, I heard no credible poverty alleviation plan from the government that does not rely on international donors and non-governmental organizations. Dependence on international aid is not sustainable and in fact it weakens state institutions.”

The UN expert added: “The question is what political leaders spent the resources on.

“For decades, Lebanon ignored the need for social policies, including strong welfare programmes and public service infrastructure, and instead focused on unproductive sectors like banking, continuously expanding public debt and devoting those resources to debt servicing.”

He added: “Lebanon has an opportunity to rethink its economic model. Continuing to incentivize a failed model based on rentierism, inequality, and sectarianism will only sink the population further into destitution.”

He warned that the international community would not take Lebanese reforms seriously “until a credible plan is proposed for how to transform the economy, address inequality, ensure tax justice, and prevent further political stalemates,” warning that the donor community was running out of patience with the Lebanese government.

“After losing $240 million to the scam of arbitrary and unfavorable exchange rates, they need to see that the government is serious about transparency and accountability, and a rights-based approach can guide the government’s efforts in this process.”

De Schutter told Reuters: “Lebanon’s officials are living in fantasy land. This does not bode well for the country’s future.”

Prime Minister Najib Mikati’s government, formed in September, is yet to convene amid an ongoing political dispute.

Meanwhile, the reserve in hard currencies at the Central Bank is shrinking to such an extent that it is no longer possible to support medicines for chronic diseases. This decline in economic capacity comes after the Central Bank lifted support for regular medicines.

The crisis has now affected patients suffering from severe and chronic diseases, especially cancer patients, who lack access to life-saving medicines.

Economist Dr. Louis Hobeika told Arab News: “The state’s revenues have vanished. The customs dollar, which is still priced according to the official exchange rate, is no longer logical, and it must be gradually raised, not immediately raised to the exchange rate on the Central Bank’s official platform.”

He added: “Politicians knew that we were on the verge of such a crisis three years ago, but they did not do anything and waited for solutions from abroad, and this did not happen.”

The economist added: “The reserves dried up, and the Central Bank says that it has only $13 billion, but it could be less.”

Hobeika said that the Ministry of Economy’s issuance of a new price for fuel coming just two days after another price was issued — which included an increase of 2,000 Lebanese pounds — indicates the extent of the crisis.

After meeting with Parliament Speaker Nabih Berri, Information Minister George Kordahi reiterated on Friday that he does not intend to resign from the government “without guarantees” — a position that Hobeika believes will “worsen Lebanon’s economic crisis after its political crisis with the Gulf.”

Hobeika added: “We have not yet seen the results of the economic boycott of Lebanon. We now fear for the fate of the Lebanese working in the Gulf, but what if the crisis affects transfers to universities, charities and civil society organizations? What if Gulf Air traffic stops? Won’t Lebanon suffocate? Patience will not do any good then.”

Despite growing pressures, it appears unlikely that the Lebanese will take to the streets to renew their protests. This popular reluctance to express anger “is way more than mere frustration, it is a loss of purpose,” Hobeika said. 

“Citizens are stuck in a hellish, vicious cycle.”


Market blast in north Syria kills at least 9, injures dozens

Updated 43 sec ago

Market blast in north Syria kills at least 9, injures dozens

BEIRUT: A rocket attack on a crowded market in a town held by Turkey-backed opposition fighters in northern Syria Friday killed at least nine people and wounded dozens, an opposition war monitor and a paramedic group reported.
The attack on the town of Al-Bab came days after a Turkish airstrike killed at least 11 Syrian troops and US-backed Kurdish fighters. The Syrian Observatory for Human Rights, an opposition war monitor, blamed Syrian government forces for the shelling, saying it was in retaliation for the Turkish airstrike.
The Observatory said the attack killed at least 10 and wounded more than 30.
The opposition’s Syrian Civil Defense, also known as White Helmets, had a lower death toll, saying nine people, including children, were killed and 28 were wounded. The paramedic group said its members evacuated some of the wounded and the dead bodies.
Discrepancies in casualty figures immediately after attacks are not uncommon in Syria.
Turkey has launched three major cross-border operations into Syria since 2016 and controls some territories in the north.
Although the fighting has waned over the past few years, shelling and airstrikes are not uncommon in northern Syria that is home to the last major rebel stronghold in the country.
Syria’s conflict that began in March 2011, has killed hundreds of thousands and displaced half the country’s pre-war population of 23 million.
President Bashar Assad’s forces now control most parts of Syria with the help of their allies, Russia and Iran.

Palestinian killed in Israeli West Bank raid: Palestinian ministry

Updated 27 min 55 sec ago

Palestinian killed in Israeli West Bank raid: Palestinian ministry

  • Israeli military say soldiers came under fire during a raid in the town
  • Israel has occupied the West Bank since the Six-Day War of 1967

RAMALLAH, Palestinian Territories Presse: A Palestinian man was killed Friday by Israeli forces during a raid in the north of the occupied West Bank, the Palestinian health ministry said.
Salah Sawafta, 58, “died of critical wounds, sustained by live bullets from the occupation (Israeli military) in the head, in Tubas this morning,” a ministry statement said.
The Israeli military said soldiers came under fire during a raid in the town.
During an operation in “Tubas, several suspects hurled Molotov cocktails and opened fire at (Israeli) troops, who responded with fire,” the army said in a statement, adding “hits were identified.”
The mayor of Tubas, Hossam Daraghmeh, said Sawafta had been leaving dawn prayers when he was shot.
“He left the mosque and was heading to his house wearing a prayer robe. There was a vengeful soldier stationed in a building near the municipality who shot him in the head,” he said.
Daraghmeh said Sawafta had been unarmed when he was hit.
“This man did not have a stone or anything in his hand,” he said.
The Israeli military said five people were detained in overnight raids across the West Bank.
On Thursday, a 20-year-old Palestinian was killed by Israeli troops during clashes in the northern West Bank city of Nablus.
Israel has occupied the West Bank since the Six-Day War of 1967, when it seized the territory from Jordan.

Algeria wildfires ‘all under control’: civil defense

Updated 30 min 12 sec ago

Algeria wildfires ‘all under control’: civil defense

  • Since the beginning of August, almost 150 blazes have destroyed hundreds of hectares (acres) of forest in Africa’s largest country

Algiers: Wildfires, which killed at least 38 people and left a trail of destruction in eastern Algeria this week, are now under control, a civil defense official told AFP on Friday.
“All of the fires have been completely brought under control,” said fire brigade Col. Farouk Achour, of the civil defense department.
Since the beginning of August, almost 150 blazes have destroyed hundreds of hectares (acres) of forest in Africa’s largest country.
Deadly fires have become an annual scourge in Algeria, where climate change has turned large areas of forest into a tinderbox in the blistering summer months.
The justice ministry launched an inquiry after Interior Minister Kamel Beldjoud suggested some of the fires were started deliberately, and authorities on Thursday announced four arrests of suspected arsonists.
Authorities have been accused of being ill-prepared, with few firefighting aircraft available despite record casualties in last year’s blazes and a cash windfall from gas exports with global energy prices soaring.


A new honeymoon for Turkey-Israel ties may begin with envoy exchange

Updated 18 August 2022

A new honeymoon for Turkey-Israel ties may begin with envoy exchange

  • Timing coincides with efforts by both countries to build relationships in region, analyst tells Arab News

ANKARA: Israel and Turkey have announced the upgrading of diplomatic relations and the return of their ambassadors and consuls general after years of strained ties between the two nations. 

Israeli Prime Minister Yair Lapid greeted such a diplomatic breakthrough as an “important asset for regional stability and very important economic news for the citizens of Israel.

According to Dr. Nimrod Goren, president of the Mitvim Institute and co-founder of Diplomeds — The Council for Mediterranean Diplomacy — the announcement on the upgrading of ties marks a diplomatic success.

"It is the culmination of a gradual process that has taken place over more than a year, during which Israel and Turkey have worked to rebuild trust, launch new dialogue channels, adopt a positive agenda, re-energize cooperation, confront security challenges, and find ways to contain differences," Goren told Arab News.

“Based on these positive developments, restoring relations at the ambassadorial level is now seen as a natural step, perhaps even a long overdue one,” he said. 

“It was important to seal this move before internal politics gets in the way, as elections in both countries are drawing near,” Goren added.

Goren said that the timing also “coincides with efforts by both Israel and Turkey to improve and deepen their various relationships in the region.”

Turkey and Israel, once regional allies, expelled their ambassadors in 2018 over the killing of dozens of Palestinians by Israeli forces during protests along the Gaza border.

Relations were completely frozen after the death of nine Turkish activists over an Israeli raid on the Gaza-bound Turkish Mavi Marmara ship in 2010. 

Since then, many attempts have been made to mend ties, especially in the energy sector, and in trade and tourism, which emerged as strategic avenues for cooperation. 

Turkish President Recep Tayyip Erdogan and Israeli President Isaac Herzog have spoken on the phone several times and Herzog visited Ankara last March. 

As part of mutual trust-building efforts, Turkish Foreign Minister Mevlut Cavusoglu also visited Jerusalem in May, marking the first visit to Israel by a Turkish foreign minister in 15 years. His visit was reciprocated by Lapid, then Israeli foreign minister, in June. 

The two countries also cooperated in counter-terrorism efforts following Iranian assassination plots against a Turkish-Israeli businessperson as well as Israeli tourists in Istanbul. Turkey took steps to curtail the movements of Hamas within the country. 

They also signed a civil aviation agreement last month. 

Dr. Gokhan Cinkara, an expert from Necmettin Erbakan University, thinks that shifts in regional geopolitics are the main determinants for Turkey’s new efforts for normalization. 

“The competition between status quo and revisionism in the region is over. Consequently, every country has alternatives and can be replaced, which is also the case for Turkey. Due to the economic crisis and geopolitical deadlock that the country is passing through, it was inevitable for Turkey to search for new options,” he told Arab News.  

“The appointment of diplomats will ensure that bilateral relations will continue to operate under an institutional routine.”  

The ambassador to Israel is expected to be appointed soon. Both countries are also set to hold a joint economic commission meeting in September. 

However, Turkish Foreign Minister Cavusoglu said that Ankara would continue to support the Palestinian cause. 

“Despite the new chapter in relations, Israel and Turkey still have differences of opinion on key policy issues, including Israeli-Palestinian relations and the Eastern Mediterranean,” Goren said. 

“These differences will not go away, but Israel and Turkey are aware of the need to be sensitive in how they deal with them and to put in place bilateral mechanisms to regularly engage on these issues,” Goren said.

“If Israel and Turkey can somehow support each other on the road to conflict resolution with third countries (e.g., Turkey with Egypt, Israel with the Palestinians) — that will be a major benefit of the new chapter in ties.”

As bilateral relations have been moving on a positive trajectory since Israeli President Herzog’s visit to Ankara, Selin Nasi, London representative of the Ankara Policy Center and a respected researcher on Turkish Israeli relations, pointed to the timing of the envoy exchange. 

“The Israeli side has been taking the process a bit slowly in order to understand whether Ankara was sincere in its efforts to mend fences,” she told Arab News. 

Ankara’s “calm and measured response in the face of tensions in Jerusalem and in Gaza in the last couple of months and its full cooperation with Israeli intelligence against Iranian plots which targeted Israeli citizens in Turkey have seemingly reassured Israel’s concerns,” she said.

Nasi thinks that the ambassadorial exchange shows Turkey and Israel’s willingness to give the normalization process a formal framework, as well as their readiness to move to the next phase. 

“Considering the upcoming elections in Israel in November, normalization of diplomatic ties is likely to provide a shield against the interference of domestic politics,” she said. 

Although Turkey and Israel have managed to turn a new page in bilateral relations, Nasi thinks that it is equally important to see what they are going to write in this new chapter.  

“Both countries have a lot to gain from developing cooperation at a time when the US is shifting its focus and energy to the Pacific region and Iran is about to become a nuclear power,” she said.

“On the other hand, the Russian invasion of Ukraine has put energy security front and center once again. It revived hopes that the pipeline project that would carry Israeli natural gas via Turkey could be eventually realized,” she said. “While the unsettled Cyprus question remains the elephant in the room, it all comes down to the sides’ mending political trust. We may therefore see some openings in the future.”

Goren thinks that a relaunching of the Israel-Turkey strategic dialogue and the resumption of regular high-level contacts will also assist the countries lessen mutual misperceptions — related, for example, to Israel’s ties with the Kurds and Turkey’s ties with Iran — and avoid gaps in expectations.  

“Israel and Turkey should make sure that this time — unlike what happened in the previous decade — their upgrade of ties will be sustainable and long-term,” Goren said. 

The exchange of ambassadors has been also welcomed by the US.

“Today’s announcement that Israel and Turkey are fully restoring their diplomatic relations. This move will bring increased security, stability, and prosperity to their peoples as well as the region,” tweeted Jake Sullivan, national security adviser at White House. 

Nasi also said that Turkey’s relations with Israel “have always been a factor of its relations with the West and with the US in particular. In the backdrop of the ongoing war in Ukraine, Ankara has been threading a fine path with Russia.”

Nasi said “normalization of ties with Israel may aim to send a message to the US Congress, whose favorable view and support on the modernization of F16s is very much sought for.”

Russian ship carrying ‘plundered’ Ukraine grain reaches Syria: embassy

Updated 18 August 2022

Russian ship carrying ‘plundered’ Ukraine grain reaches Syria: embassy

  • "According to our information, SV KONSTANTIN has docked in Syria," the embassy said
  • It said the ship was carrying "grains that were plundered and illegally transported by the Russian occupation authorities"

BEIRUT: A Russian cargo ship allegedly carrying stolen Ukrainian grain has reached Syria, Kyiv’s embassy in Beirut said Thursday, the latest in a series of contested shipments arriving in the war-torn country.
“According to our information, SV KONSTANTIN has docked in Syria,” the embassy said in a statement to AFP.
It said the ship was carrying “grains that were plundered and illegally transported by the Russian occupation authorities,” adding that the vessel was initially destined for the Lebanese port of Tripoli.
Ukraine has repeatedly accused Russian forces of ransacking its grain warehouses since they invaded the country in late February.
The embassy’s statement came as another cargo ship carrying the first shipment of grain allowed to leave Ukraine under a UN-backed deal reportedly unloaded its cargo at the Syrian port of Tartus, which is managed by a Russian firm.
The Sierra Leone-flagged vessel Razoni was expected to arrive in Lebanon, but the shipment’s five-month delay prompted the Lebanese buyer to cancel the deal once the ship was already at sea, Ukrainian officials had said.
According to Samir Madani, co-founder of oil shipping monitoring website, the vessel docked in Tartus earlier this week.
Satellite imagery appeared to show that the ship — which was carrying 26,000 tons of corn — was unloading its cargo, Madani tweeted on Thursday.
Earlier this month, a Syrian-flagged ship was briefly seized by Lebanese authorities following similar claims by the Ukrainian embassy that it was laden with stolen cargo.
Lebanon later released the Laodicea vessel after investigations failed to prove it carried stolen goods, drawing criticism from Kyiv’s embassy.
The Laodicea started unloading its cargo at Tartus on August 8, according to Syrian state media.
Syria is a staunch ally of Russia, which intervened in the country’s civil war in 2015 to support President Bashar Assad’s government.
Moscow has lent Damascus very limited amounts of financial aid, but it has supplied Syria with wheat as a form of assistance.
The Syrian government relies on Moscow for the bulk of its wheat imports.