The economic and political crisis which has brought millions of protestors to the streets of Lebanon since October 2019 has intensified during the Covid-19 pandemic. Over the same period, the Lebanese pound has lost 80% of its value. While the government attempts to negotiate a bailout with the IMF, aiming to sustain the banking sector and the privileges of the rich, unemployment and famine stalk the country, and refugee camps in particular. Nationally, 50% are now in poverty and unemployment has reached 35%. US imperialism and its allies are exploiting the crisis to try and destroy Hezbollah, with new measures introduced by Trump to recolonise the region.
Some commentators are warning that the financial and coronavirus crises are leading Lebanon towards famine on the scale of 1915-18, which resulted in around 200,000 deaths. Two months into the crisis and after refugee cases of the disease had already been discovered, UNRWA, the aid agency for Palestinian refugees across the Middle East, announced a one-off $35 payment to refugees. US funding cuts have meant that UNRWA had a $55m budget shortfall in 2019. Teachers have reported children coming into school unfed. Covid-19 outbreaks have been reported at the cramped Ein El Hilweh and Beddawi refugee camps.
Syrians in Lebanon are surviving on an average of less than $2.90 per day and 60% have been permanently laid off, compared with 39% of Lebanese citizens. Many have attempted to return to Syria but the borders are currently closed. On 15 July, labour minister Lamia Yammine announced a crackdown on foreign workers, targeting ‘illegal’ Palestinian and Syrian workers with fines. Many do not possess the documents necessary to apply for official work permits and are banned from 39 professions. In a further symptom of the racist status quo, non-Lebanese citizens have been banned from buying subsidised dollars. Migrant workers from further afield have been made destitute, including hundreds of Ethiopian and Nigerian women sleeping outside embassies in Beirut for weeks, abandoned by migrant labour agencies which recruited them as part of a super-exploited workforce.
The financial collapse has brought the destruction of a previously well-off Lebanese middle class, with causes including the drying up of international remittances. The central bank had sought to boost foreign exchange reserves by offering huge interest rates on US dollar deposits, but this has now imploded dramatically. Tens of thousands have become heavily indebted, and have lost their jobs and salaries. A shortage of dollars has sent inflation into orbit. NGO workers, small grocery store owners and pharmacists living in better off neighbourhoods in the northern city of Tripoli have been a vocal section of demonstrations. Bank branches are barricaded and executives are anxious not to be seen in public. While many protestors have embraced anti-capitalist demands, some have joined racist and pro-Israel mobilisations led by the Phalangist Lebanese Forces Party, whose MPs quit parliament opportunistically to ‘support’ the protests.
October 2019 saw the biggest marches in Lebanese history, with a third of the population (more than two million people) taking part in protests denouncing sectarianism and economic attacks on the workers. Demands included calls for a secular system and redistribution of the wealth accumulated by the idle rich. Covid-19 lockdowns have not halted the movement, with huge cross-country demonstrations in June denouncing government inaction. Prime Minister Hasan Diab asked for patience, claiming that his government needed more time to fight corruption. Yet the miniscule reforms promised months ago have amounted to nothing. Recent events have debunked the myth that a government of millionaire politicians could curb the excesses of capitalism.
Despite accelerating poverty, bankers have smuggled $6bn out of Lebanon since October, according to Alain Bifani, who resigned as Director General of Finance in early July. While new controls prevented ordinary account holders from withdrawing more than $100 a week, foreign currency deposits of resident customers dropped by $11bn over the same period. Referring to a ‘dirty elite’ of bankers and politicians, Bifani said he saw Lebanon’s ‘old demons coming back’ – referring to the 1975 outbreak of war. Lebanon defaulted on its $90bn state debt in March and its GDP is expected to shrink by around 14% this year.
Lebanese politicians have for months been wrangling over an IMF bailout, seeking $20bn in foreign aid to stimulate the ailing economy. The loan has yet to be approved and some politicians have downgraded their estimated financial sector losses from $62bn to $18bn. However, the IMF is sceptical. More inclined to believe the government’s higher figure, the IMF estimates losses equivalent to 91% of Lebanon’s total economic output in 2019 and almost equal to the total value of the deposits held by the central bank from the country’s commercial banks.
Among the IMF’s demands are that Lebanon audit its central bank, and issue official capital controls to replace informal caps on withdrawals imposed by the banks. Omar Deeb of the Lebanese Communist Party reports that IMF reforms will mean ‘privatisation of the public-sector companies (electricity, telecoms, water), cancelling government subsidies for essential goods (wheat, medicine), “reforming” the pension schemes by lowering pensions and cutting the public sector.’ There will be wider political implications attached: with the US having a 16.52% IMF share and with it veto power, any negotiations will attempt to drive a wedge between the Lebanese rulers and opponents of imperialism. This means demanding Lebanon severs links with Syria and Iran. US Secretary of State Mike Pompeo stated: ‘Hezbollah is a terrorist organisation and we are supportive of Lebanon as long as they get the reforms right and they are not a proxy state for Iran.’ Britain has followed the US in designating Hezbollah as a ‘terrorist’ group. The IMF ‘deal’ can only mean that Lebanon becomes a proxy state of US imperialism.
The position of Hezbollah is complicated by both the cross-class alliances it sees as necessary to protect Lebanese sovereignty and a need to maintain unity of forces capable of repelling Zionist or imperialist attack. Sayyed Hassan Nasrallah and other leaders have so far opposed IMF intervention and see China as an alternative source of investment. Nasrallah said on 17 June, ‘Whoever is going to make us choose between being killed by weapons or being killed by starvation, I tell them: We will continue to carry our weapons and we won’t starve; and we will kill you.’
Louis Brehony
FIGHT RACISM! FIGHT IMPERIALISM! 277 August/September 2020
