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.”


Greek PM criticizes ‘constant aggressive behavior’ of Turkey

Updated 05 July 2022

Greek PM criticizes ‘constant aggressive behavior’ of Turkey

  • Greece has voiced strong support for Ukraine in its war against the Russian invasion
  • Mitsotakis noted he was referring to “the constant aggressive behavior of Turkey,” with which relations have shown increasing strain over the past two years

ATHENS: Greece’s prime minister said Tuesday that Russia’s war in Ukraine is a “turning point” in the course of Europe, stressing that any type of outcome that could embolden aggression by other nations on the continent must be avoided.
Greece, which has long-standing disputes with far larger neighbor Turkey that brought them to the brink of war three times in the last half-century, has voiced strong support for Ukraine in its war against the Russian invasion.
“The battle of Ukraine is not just another event on the international scene. It is a turning point in the course of Europe,” Prime Minister Kyriakos Mitsotakis said in a speech at the European Parliament in Strasbourg, France.
“We owe it today to Ukraine to avert any type of fait accompli which could be imitated tomorrow by new potential trouble-makers,” he said.
Mitsotakis noted he was referring to “the constant aggressive behavior of Turkey,” with which relations have shown increasing strain over the past two years. Although both NATO members, the two countries have decades-old disputes over a series of issues, including territorial claims in the Aegean Sea and energy exploration rights in the eastern Mediterranean.
Recent quarrels have focused on Greek islands off Turkey’s coast, with Ankara accusing Athens of maintaining a military presence there in violation of treaties. Greece counters it is acting according to international law and is defending its islands in the face of Turkish hostility.
“One thing is certain, we do not need new revisionism and the revival of imperial fantasies,” Mitsotakis said. “And another thing is also certain, Greece will not tolerate any questioning of its national sovereignty and territorial integrity.”
The Greek prime minister said his country was “keeping our doors shut to threats, keeping our windows open to peaceful contacts. Disputes between nations are resolved based on international law, not through bullying.”
Last Friday, Turkish President Recep Tayyip Erdogan accused Greece of violating its airspace — something which Greece frequently accuses Turkey of doing to its own airspace, and denies violating Turkey’s.
“We don’t have an issue like ‘let’s go to war with Greece, let’s make war.’ But Greece is not standing by their promises,” Erdogan said after Friday prayers, accusing Greece of having violated Turkish airspace 147 times.
“Of course, if you’re going to violate our airspace like this, then what falls on us? My air force will give you the necessary visuals. That’s what our air force is doing,” Erdogan said, adding that “our armed forces are doing their duty and if these airspace violations continue after this, we will continue to do our duty in the same way.”
The Turkish president said the leaders of many NATO countries had tried to reconcile him and Mitsotakis. Erdogan said that “we are not thinking that right now,” but would see what happens in the future and evaluate it then.

Belgian held in Iran for ‘espionage’

Updated 05 July 2022

Belgian held in Iran for ‘espionage’

  • Man was seized in Iran on February 24 and has been in ‘illegal’ detention since

BRUSSELS: Iran has been holding a Belgian man for the past four months under “espionage” charges, Belgium’s justice minister said Tuesday, as his country weighed a controversial prisoner swap treaty with Tehran.
The man was seized in Iran on February 24 and has been in “illegal” detention since, the minister, Vincent Van Quickenborne, told Belgian MPs without identifying him.
Belgium last year imprisoned an Iranian diplomat for 20 years after his conviction under “terrorist” charges for plotting a bomb attack outside Paris in 2018.
While Quickenborne did not give the detained Belgian’s identity, Iran International, a Saudi-financed media outlet based in London, reported that a 41-year-old Belgian former aid worker is detained in Iran.
The outlet said the Belgian’s arrest appeared to be another instance of Iran “imprisoning foreigners as hostages to exchange them with certain Iranians jailed in Western countries.”
Among those Iran is holding is a Swedish academic who also holds Iranian citizenship, Ahmadreza Djalali, who taught at a Brussels university. Iran also applied “espionage” charges to Djalali and has sentenced him to death.
Quickenborne said officials from Belgium’s embassy in Tehran had twice visited the jailed Belgian to give all possible assistance, and that his family had earlier Tuesday made public his detention.
“I cannot say more, at the express request of the family,” the minister said.
Belgium’s parliament on Thursday is to vote on whether to ratify a bilateral treaty with Iran that would open the way for prisoners in each country to be repatriated.
Quickenborne on Tuesday said as he presented the proposed treaty to MPs for debate that “if the bill is not fully approved, the threat to our Belgian interests and certain Belgian citizens will increase.”
Some US lawmakers, however, are pressing Belgium to ditch the proposed treaty, which was signed in March.
One, Randy Weber, a Republican representative in Texas, tweeted he was “shocked to find out that the Belgian gov has cut a deal with the world’s leading state-sponsor of terrorism and plans to send Iranian terrorists back to Iran to plot more terroristic acts.”
The imprisoned Iranian diplomat, Assadollah Assadi, was convicted by a Belgian court in February 2021 of attempted “terrorist” murder and “participating in the activities of a terrorist group.”
He was found guilty of supplying explosives for a bomb attack on June 30, 2018 event outside Paris held by the dissident National Council of Resistance in Iran (NCRI) group.
Information supplied by several European intelligence services allowed Belgium to thwart the attack by intercepting the car carrying the bomb.
A two-year investigation into the plot determined that Assadi was an Iranian agent operating under diplomatic cover.
Assadi was arrested in Germany, where his claim to diplomatic immunity was denied because he was attached to Iran’s embassy in Austria, and extradited to Belgium for trial.
He opted not to appeal against his sentence. Tehran has protested his conviction.
Lawyers for the NCRI, whose core is made up of a militant organization known as the MEK, said the proposed Belgium-Iran treaty was designed to allow Assadi to go back to Iran.
The controversy in Belgium over the treaty comes as European powers are trying to bring Iran and the United States back into compliance with a 2015 nuclear deal.
That pact was badly weakened when former president Donald Trump pulled America out in 2018.
Iran has since leapt ahead with its uranium enrichment to a level putting it close to the point where it could produce nuclear weapons.


France repatriates 35 children, 16 mothers from Syria camps

Updated 05 July 2022

France repatriates 35 children, 16 mothers from Syria camps

  • Minors were handed over to child protection services while the mothers would face judicial proceedings

PARIS: France has repatriated 35 children and 16 mothers from camps in Syria where family members of suspected Daesh terrorists have been held, the foreign ministry said in Paris.
“France has today undertaken the return to the country of 35 French minors who were in camps in northeast Syria. This operation also includes the return of 16 mothers from these same camps,” a statement said, adding that the minors were handed over to child protection services while the mothers would face judicial proceedings.

Israel PM visits France with Lebanon gas row topping agenda

Updated 05 July 2022

Israel PM visits France with Lebanon gas row topping agenda

  • Yair Lapid took over the premiership on Friday following the collapse of Israel’s coalition government

TEL AVIV: Israeli Prime Minister Yair Lapid departed on his first foreign trip in office Tuesday to France, where he will ask for backing on a gas dispute with Lebanon that days ago saw Israel shoot down three Hezbollah drones.

Lapid took over the premiership on Friday following the collapse of Israel’s coalition government, which will see the country return to the polls in November for its fifth election in less than four years.

The new leader was confronted with his first test a day later, when Lebanon’s Hezbollah movement launched three drones toward an offshore gas field in the eastern Mediterranean.

Speaking before his departure from Tel Aviv, Lapid said he will raise the matter with French President Emmanuel Macron.

“We will also discuss of course what has occurred recently off the coast of Lebanon,” Lapid said.

“There have been repeated attacks on Israeli gas rigs. Israel will not accept this type of attacks on its sovereignty.”

Lebanon rejects Israel’s claim that the Karish gas field lies within its territorial waters.

Israel and Lebanon resumed negotiations on their maritime border in 2020, though the Karish site sits outside of the disputed area and is marked as Israeli on previous United Nations maps.

The US-backed talks have been stalled by Beirut’s demand that the UN maps must be modified.

Hezbollah’s backers Iran will also be on the agenda at the bilateral talks in Paris, as Israel stands firmly opposed to international efforts to revive a nuclear accord with Tehran.

“It’s important that our position against this agreement is heard,” Lapid said Tuesday.

Israeli officials fear that giving Iran sanctions relief in exchange for curbs on its nuclear program could allow Tehran to boost funding to Hezbollah, as well as the Palestinian militant group Hamas.

A senior Israeli official said the Lebanon gas issue will be high on agenda during talks at the Elysee Palace in Paris.

“We will ask France to intervene to secure the negotiations that we want to lead until the end of the gas issues,” the official told journalists traveling with the premier.

Lapid’s Paris visit comes days ahead of US President Joe Biden traveling to Israel and the Palestinian territories, before flying to Saudi Arabia for energy talks.

Washington is seeking to stabilize the global energy market following the Russian invasion of Ukraine, which led Moscow to cut its gas supplies to some European countries.

Israel and Egypt signed a deal last month to boost gas exports to the European Union, as the bloc attempts to end its dependency on Russian energy.

“The Lebanon issue is essential and Lapid will come back to the Israeli position, according to which Hezbollah is first and foremost a threat to the future of Lebanon,” said the Israeli official, who requested anonymity.

Israel and Lebanon remain technically at war but agreed to talks aimed at delineating their maritime border to allow both countries to boost gas exploration.

Egypt FM in London to inaugurate partnership council

Updated 04 July 2022

Egypt FM in London to inaugurate partnership council

CAIRO: Egypt’s Foreign Minister Sameh Shoukry headed to London to inaugurate the first partnership council between his country and the UK.

The council will be co-chaired by Shoukry and British Foreign Secretary Liz Truss. It will include political consultations and discussions on economic and trade issues, with the participation of British Trade Policy Minister Penny Mordaunt.

A spokesman for Egypt’s Foreign Ministry said the launch of the council comes in light of strengthening cooperation between the two countries in various fields.

While in London, Shoukry met with Lord Tariq Ahmad, British minister for South Asia, North Africa, the UN and the Commonwealth, to discuss bilateral relations.