The war in the Middle East has put Lebanon on the brink of economic disaster

The recent return of violence to Lebanon is undermining hopes that the worst of the crisis that has plagued the country for the past 4 years is now behind us.

After a spiral of hyperinflation, debt defaults and the collapse of public services, modest signs of economic recovery in one of thethe most serious crisis episodes (observed) around the world since the mid-Nineteenth century” was projected for 2024. However, this ray of optimism has faded as Lebanon risks being drawn into war with Israel.

January 2 Israel murdered senior Hamas political official Saleh al-Arouri in southern Beirut after every day Israeli shelling in southern Lebanon.

The conflict has already led to displacement over 75,000 residents in Lebanon, in addition to the death of one other 25 people. The conflict in Gaza also led to the cancellation ofover half of travel bookings to Lebanon“during the winter break. The tourism spending shock will quickly reverse the weak economic growth projected for 2023.

The mood in Lebanon over Christmas was one of deep concern about the prospect of conflict. Any spread of the conflict inside the country would result in further internal displacement and the stretching of state services beyond their breaking point.

Last conflict between Israel and Lebanon – in 2006 – it bore fruit estimated $6.75 billion (£5.3 billion) value of damage and lost income, in addition to hundreds of people killed or displaced from their homes.

A repeat of the 2006 war in Lebanon would cause a humanitarian catastrophe and worsen Lebanon’s already weakened economy. It is value noting that a brand new conflict would likely force hundreds of Lebanese residents to flee the country, exacerbating an already existing outward migration trend, which has not gone unnoticed by nearby Mediterranean countries.

Prelude to war?

The Iran-backed Lebanese militant movement Hezbollah sees itself as: resistance to Israel. Hezbollah has estimates 130,000 rockets and missiles ready for any conflict with Israel.

But despite this antagonistic stance, the group’s secretary-general, Hassan Nasrallah, has remained restrained in his rhetoric, a hopeful sign that he’s attempting to avoid war.

Immediately after al-Arouri’s assassination in Beirut, Nasrallah discussed the possibility “liberate” the entire territory of Lebanon through talks and an end to Israel’s use of Lebanese airspace and land to launch attacks on Syria. There are precedents for such conversations. In 2022, U.S.-brokered negotiations between Lebanon and Israel established clear boundaries inside which each countries could probe for natural gas.

It appears that Nasrallah’s encrypted message was heard by the United States. On January 11, US senior energy adviser Amos Hochstein landed in Beirut to debate ways to cut back tensions between the two countries.

While these proposals could appear positive, Lebanese society is aware of the uncertainties ahead. Nasrallah walks a tightrope between keeping Lebanon out of a conflict it cannot afford and attempting to be sure that Hezbollah maintains its credibility as the “resistance” to Israel.

There is fear on the streets of Lebanon that that is an unattainable path to negotiation and that Hezbollah will eventually be stimulated to take further motion, resulting in an escalation of the conflict. He reports it Israel murdered two Hezbollah commanders in southern Lebanon on January 14 only increased pressure on Hezbollah to reply.

Why is Lebanon so fragile?

Several overlapping crises over the past decade have already led Lebanon to collapse. The civil war in neighboring Syria has been ongoing since 2011 an estimated 1.5 million refugees seek refuge in Lebanon. This country hosts the world’s largest number of refugees per capita and per square kilometer.

Lebanon can be struggling serious economic crisis since 2019, which worsened as a result of the outbreak of the Covid-19 pandemic. As a result of this crisis, roughly 80% of Lebanese people now live in poverty and 36% below the extreme poverty line.

This crisis deepened in 2020 in consequence of: Explosion in the port of Beirut, in which 218 people died and part of the country’s capital was devastated. The explosion knocked half of Beirut’s healthcare facilities out of service, affected 56% of the city’s private businesses, and caused as much as $4.6 billion in property damage.

Lebanon’s precarious situation is made worse by a corruption-ridden power-sharing government and dysfunctional institutions. Lebanon is ranked 150 out of 180 countries for corruption, the government didn’t adopt a budget for over ten years, and credible allegations vote buying and political interference in elections have been recorded.

Lebanese residents, who’ve borne the brunt of these crises, have directed their anger at the government. In October 2019, when the economic collapse began, an estimated 2 million people took to the streets demand the resignation of the government.

The survey results also indicate a rapidly declining level of trust in the government and state leaders. Only 8% of Lebanese residents say they’re very or quite trusted in the government.

This is way lower than in other Middle Eastern countries surveyed. In Iraq, where residents have the next lowest level of trust in their government, a much higher percentage (26%) say they’ve an awesome deal or quite rather a lot of trust in their government.

Ceasefire crucial

In light of Lebanon’s instability, the prospect of war between Israel and Lebanon should be avoided in any respect costs. An immediate ceasefire in Gaza is crucial.

Moreover, a possible framework for an agreement between Israel and Hezbollah is already available. UN Security Council Resolution 1701 states that Israel respects Lebanese sovereignty and requires the deployment of a UN peacekeeping force on the border.

Reliable International mediation and pressure are urgently needed to implement an agreement aimed toward averting a humanitarian catastrophe.