Shops, government offices, businesses and banks, largely controlled by Lebanon’s Christian and Sunni elites, closed in a general strike last Thursday.
Protesters erected roadblocks in Beirut and other cities, burning tires and crippling traffic, including the road to Beirut airport.
As workers joined the strike to protest the appalling social conditions and endemic corruption that have destroyed their livelihoods, corrupt political parties in Lebanon seized the opportunity to call for the immediate installation of a new government.
Their attitude of support for the strike has been widely ridiculed on social media, with one Twitter user writing: “Let me understand. The same corrupt government, the criminal ruling class that blew up this city are actively protesting against themselves …? In what world is this acceptable?
The previous Friday, pharmacies called a two-day nationwide strike over the central bank’s failure to provide them with dollars at a preferential exchange rate as was the case before. This has made it impossible to import goods at an affordable price, amid a severe shortage of drugs and infant formula as hospitals struggle to cope with the coronavirus pandemic as criminal gangs amass or bring out drugs smuggled from the country.
The economic crisis was intensified by the pandemic, the default last year on Lebanon’s sovereign debt to international lenders and the explosion at the Port of Beirut last August that killed 211 people, injured more than 6,000 and destroyed much of the northern part of town.
More than half of the population has been plunged into poverty due to the drop in the purchasing power of the pound and the soaring unemployment rate which rose from 28% in February last year to 40% in December. While the government has said it will put in place a system of financial support to help those who need it most, it has failed to do so, leaving political parties to provide food and other aid to their families. clients.
A World Bank report released this month called Lebanon’s economic crisis one of the worst in the world for more than 150 years. Lebanon’s GDP fell from nearly $ 55 billion in 2018 to about $ 33 billion in 2020, a 40% drop in GDP per capita. Its currency has lost 90% of its value since late 2019 and is now trading at 15,100 pounds to the US dollar, with spike in inflation set to worsen this year.
According to Lebanon’s statistical service, last December food prices quadrupled in a year, clothing and footwear prices quintupled, and hotels and restaurants more than six times, while the minimum wage fell in terms actuals at just $ 67 per month, down from about $ 450 per month two years ago.
There are now shortages of food, fuel and electricity. Karpower of Turkey recently closed two floating electric barges that provide a quarter of the country’s electricity due to payment arrears. Basics like oil, flour, rice and sugar are gone. Meat is unaffordable, while people are forced to stand in line for hours to buy gasoline.
As the World Bank has pointed out, “Such a sharp and rapid contraction is usually associated with conflict or war.” He warned: “The dire socio-economic conditions risk systemic national failures with regional and potentially global consequences. It was a reminder that what is happening in Lebanon has ramifications beyond its borders, especially Syria, whose economy, financial system and people are inextricably linked to that of Lebanon.
The economic crisis has been made worse by political paralysis. After mass protests erupted in October 2019 against growing poverty, social inequalities and widespread government corruption, demanding an end to the sectarian political system and elections to form a new government, Hassan Diab, professor of engineering at the American University of Beirut has been asked to form a “technocratic” government. He replaced the government of Sa’ad Hariri, the billionaire Sunni client of Saudi Arabia and France, early last year.
As the new government sought to impose the cost of Lebanon’s financial losses on the banking sector, and thus on corrupt Sunni and Christian politicians with banking interests, including the Hariri family, the financial elite and their political allies acted to undermine the government’s economic program. .
As it became clear that he would be held responsible for last August’s explosion in the port of Beirut – although he was the first to sound the alarm on explosives held in the port since 2014 – Diab’s short-lived government has resigned. Once again, President Michel Aoun turned to the largely discredited Hariri to form a government, but the two failed to agree on a new cabinet that would include their various patronage networks. —Aoun supporting the Free Patriotic Movement, led by his son-in-law — the Gebran Bassil law and the Shiite Hezbollah party — no new government has been sworn in and Diab continues to play the role of guardian.
The country’s foreign reserves that are used to finance subsidies on basic commodities, including fuel, medicine and wheat, are running out. Lebanon, whose health system has collapsed, has suffered nearly 8,000 deaths from the coronavirus, if official figures are to be believed. Some hospitals refuse to perform anything other than emergency services to preserve remaining medical supplies, while desperate citizens are turning to the internet to trade goods and barter drugs.
Earlier this month, Hassan Nasrallah, who leads the Hezbollah movement which, along with his allies, holds a majority in parliament, said Lebanon may soon have to rely on fuel imports from Iran if shortages persist. .
Lebanon, a small country whose population has grown to six million following the influx of Syrians fleeing the decade-long proxy war to overthrow President Bashar al-Assad’s regime orchestrated by US imperialism, has long been at the mercy of rival regional powers. and their most powerful supporters. Caught in the crosshairs of the escalating conflict between the United States, Israel and the Gulf petro-monarchs on the one hand, and Iran and its allies, including Syria on the other, he was put strained as Washington intensifies pressure on Iranian.
The Gulf states have made any aid dependent on a government that excludes Hezbollah, while Western banks and institutions have refused to disburse the $ 11 billion pledged at a 2018 conference until the government puts in place. implement the free market reforms demanded by the International Monetary Fund. It is anathema to Lebanon’s corrupt financial elite who depend on government aid.
If talks in Vienna on resuming the 2015 nuclear deal with Iran are successful, with a partial lifting of sanctions on oil exports that have crippled the Iranian economy, it would free up Iranian funding for regional allies to Tehran. This would allow Hezbollah to partially fill Lebanon’s financial and economic vacuum, and thus align the country more closely with Iran, and by implication Russia and Syria.
It is for this reason that the US State Department announced last week that it would grant the Lebanese Armed Forces (LAF) an additional $ 15 million in foreign military funding. This brings the total for the year to $ 120 million, including to support Lebanon’s “border security and counterterrorism operations” which are expected to receive an additional $ 59 million. This would include operations in Syria, support for the offensive against the Islamic State, as well as the maintenance of “internal stability”.
Warning of a “critical” situation, LAF chief General Joseph Aoun said last Thursday at a France-led virtual meeting of the great powers and some Gulf Arab states that the country’s economic crisis would lead to the collapse of all state institutions. He said he did not have enough money to adequately pay his 80,000 soldiers, who were earning the equivalent of only $ 90 per month. The military worked illegally to increase their income, taking time off without permission or resigning. His warning came after the recent reception by the FAL of ammunition from Russia and around 100 light vehicles from China.
Aoun declared that the army was the “sole guarantor” of Lebanon’s security and its “most reliable institution at the national and global level … Therefore, maintaining cohesion and supporting the ALF to carry out their mission successfully. are of paramount importance ”.