Lebanon Seen Drifting Toward Total Chaos Amid Collapsing Pound

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Lebanon Seen Drifting Toward Total Chaos Amid Collapsing Pound

Crises-hit Lebanon over the weekend teetered on the verge of complete chaos driven by the Lebanese pound’s dramatic nosedive against the dollar that sent agitated Lebanese to the streets across the country, blocking highways with burning tires in Beirut and other areas and attacking public utilities to protest the deteriorating economic conditions.

A Future Movement lawmaker said fears of Lebanon plunging into total chaos have grown as a result of the collapsing pound and the continued obstruction of the formation of a new government by Aoun and his team. “Definitely, such fears [of total chaos] have increased as a result of the state of stagnation and obstruction adopted by the ruling team,” MP Mohammad Hajjar told The Daily Star Sunday.

Referring to Friday’s meeting between French Foreign Minister Jean-Yves Le Drian and US Secretary of State Antony Blinken in Paris, Hajjar said: “After their meeting, the French and American foreign ministers did not dither to warn that Lebanon is heading on the way to extinction if the current situation stays as it is. The road to extinction means absolute chaos and collapses at all levels. The team of [Aoun’s] mandate is alone responsible for this. Those who insist on blocking the government formation must bear full responsibility for what is happening.”

Speaking at a joint news conference in Paris, Le Drian said France and the United States have agreed to act together to put pressure on Lebanese officials responsible for the political and economic crisis gripping the country.

The collapsing Lebanese pound, which Saturday sank to a record low for the first time in Lebanon’s history, trading at LL18,000 to the US dollar on the black market, coincided with the breakdown of public services that has left the country in total darkness and with closed gas stations as a result of severe fuel, gasoline and diesel shortages that have threatened to bring to a complete halt private generators on which the majority of the Lebanese and businesses, including hospitals, depend for electricity.

Worse still, while Lebanon was quickly sliding toward the abyss and faced the risk of instability and social unrest and while top leaders have failed to agree on the formation of a new government to rescue the country, a fierce war of words erupted Saturday between the Free Patriotic Movement and the Amal Movement that carried with it intense political connotations and threatened to inflame sectarian tensions.

MPs and supporters of the two parties exchanged harsh and derogatory statements and tweets, accusing one another of involvement in state corruption and the squandering of public funds, largely blamed for the country’s crippling economic and financial crisis, the worst in decades.

The FPM-Amal tensions come on top of already strained ties between President Michel Aoun and the FPM on the one hand, and Prime Minister-designated Saad Hariri and the Future Movement on the other.

Since Hariri was designated by a parliamentary majority on Oct. 22 to form a new government, Aoun and the premier-designate have traded accusations about blocking the formation of a proposed Cabinet of nonpartisan specialists to enact reforms and salvage the country from all-out economic collapse.

Each also accused the other of violating each other’s constitutional powers in the Cabinet formation process, which has been stalled for months by a deepening rift between Aoun and Hariri over the makeup of the new government and the distribution of key ministerial seats.

The FPM-Amal rift is certain to ramp up political tensions in a country already wrestling with the worst economic and financial crunch in decades, posing the biggest threat to its stability since the 1975-90 Civil War.

In response to the falling pound and severe fuel shortages that led to long queues at gas stations, angry protesters Saturday blocked highways and main roads with burning tires and trash dumpsters across the country, including Beirut.

Protesters attacked public utilities, including branches of the Central Bank in the northern city of Tripoli and Sidon in the south. Calm returned to Tripoli Sunday after nearly 20 people, both civilians and soldiers, were reported wounded in overnight scuffles in the city between security forces and protesters.

Lebanon’s national currency has been in free fall since late 2019 as the impact of a political paralysis alongside the lifting of subsidies on essential goods has plunged the country into deeper economic and political turmoil. The pound has now lost more than 90 percent of its value on the parallel market, sending prices of food and other basic items skyrocketing and pushing more than half of Lebanon’s 6 million population into poverty and unemployment.

The price of fuel is expected to rise next week after the government said it would fund fuel imports at a rate of LL 3,900 to the dollar, instead of the official rate of LL1,507. The move effectively reduces subsidies on fuel as the Central Bank tries to shore up fast-diminishing foreign currency reserves.

Meanwhile, the FPM-Amal war of words has cast gloom on Hezbollah leader Sayyed Hasan Nasrallah’s attempts to find a solution to the Cabinet formation crisis.

In a televised speech Friday, Nasrallah said he accepted a request from MP Gebran Bassil, the FPM leader, for help in securing Christian rights in the new government. Hezbollah is a key ally of Aoun and the FPM.

Nasrallah said Hezbollah had presented “new ideas” to tackle “sticking points” in the Cabinet formation process which has been stalled for months over a rift between Aoun and Hariri regarding who should name two Christian ministers who are not part of the president’s Cabinet share. Aoun and Bassil strongly reject Hariri’s insistence on naming the two Christian ministers which the premier-designate argues is part of his constitutional powers. Hariri also wants the FPM’s Strong Lebanon bloc to grant a vote of confidence to the new government in exchange for allotting eight ministers to Aoun in the proposed 24-member Cabinet.

Seeking to defuse the FPM-Amal tensions, which followed a bitter war of words between Aoun and Parliament Speaker Nabih Berri earlier this month over the Cabinet formation process, the two parties Saturday issued separate statements calling on their supporters to halt media rhetoric against each other.

“In order to make way for Sayyed Hasan Nasrallah’s Cabinet efforts to succeed, and out of the Free Patriotic Movement’s desire for a government to be formed as soon as possible, the FPM asks its supporters to stop any media rhetoric with the Amal Movement,” the FPM’s central media committee said in a statement.

Later, the Amal Movement’s central media office issued a statement saying: “Since we have always been keen on not entering into polemics with any internal party and we were in a position to respond to statements and tweets that targeted [Amal’s] symbols and leaders, and after the FPM’s latest statement, we ask all supporters to stop all kinds of media polemics with the FPM.”

The FPM’s political committee also Saturday called on Hariri to “respond to the efforts being exerted and soon after his return to Lebanon to form a government capable of putting an end to the continuing dangerous financial and economic deterioration.”

In a statement issued after its weekly online meeting chaired by Bassil, the committee praised Nasrallah’s favorable response to the FPM leader’s request to him to secure Christian rights in the new government. The positions of Bassil and Nasrallah are “sufficient to confirm their readiness to carry out any positive moves to facilitate the birth of the government,” the statement said.

The FPM’s committee expressed its concern over the “negative repercussions on all the conditions if it turned out that there is no will to form a government.”

In his speech, Nasrallah stressed that Berri’s initiative aimed at solving the Cabinet formation crisis was still in place despite being rejected by Bassil.

The initiative, backed by Hariri and most of Lebanese parties, calls for the formation of a 24-member Cabinet of nonpartisan specialists with no veto power to any side. It is viewed by many politicians as the last chance to resolve the Cabinet crisis after the collapse of local, regional and foreign mediation attempts.

Hariri met Saturday in Istanbul with Turkish President Recep Tayyip Erdogan, discussing bilateral relations between the two countries, the conditions in Lebanon and the region, according to a statement released by Hariri’s media office.

Hariri has put on hold for now his decision to step down in response to the continued obstruction by Aoun and Bassil of his attempts to form a proposed Cabinet of nonpartisan specialists to carry out reforms and save the country from all-out economic collapse. He has said that stepping down was a “serious option.”

Source: The Daily Star