The United Nations Conference on Trade and Development (Unctad) last week announced that foreign direct investment into Lebanon last year fell by 19.4 per cent to US$2.34 billion compared with $2.9bn in the previous year.
The figure was 46.5 per cent lower than 2009, a year in which inflows hit a high of $4.3bn. The Syrian civil war has had an undeniable effect but if the Lebanese had not insisted on electing the same crooks, gangsters and ideologue charlatans, they might have had a decent chance at insulating the economy from the buffeting winds of a regional conflict.
So in a week in which the United Kingdom rightly or wrongly left the European Union in a national referendum – I voted Remain, by the way – maybe it is worth revisiting that hoary old issue that many would like put to a national plebiscite: the matter of Hizbollah’s weapons.
In autumn 2006, I asked a veteran Middle East correspondent why the Lebanese did not just have a referendum on Hizbollah and its huge arsenal. The country was licking its wounds from a month-long war between the militant Shia party and Israel. More than 1,000 Lebanese were killed and material damage to the country was estimated at $6bn, 15 per cent of GDP.
Even after the clean-up, which was financed in part by generous GCC donations, it was clear there was no way the country was going to achieve any economic traction as long as Hizbollah sat outside the state. It had more firepower at its disposal than the national army and showed scant regard for any national interests outside its own narrow martial agenda.
“Be careful what you wish for,” he said. “The party is confident it would win a national vote on precisely this issue.” And at the time, he was probably right.
What made the situation all the more frustrating for those of us who simply wanted a level playing field to ensure Lebanon realised its enormous economic potential was the ratification in February 2006 of a memorandum of understanding between Hizbollah and Michel Aoun, the leader of the Christian Free Patriotic Movement and a former army commander.
Mr Aoun returned from a 15-year exile in Paris a year earlier after the 2005 Syrian withdrawal and set about consolidating a support base made up of mainly middle-class professionals – doctors, lawyers engineers architects and the like – disillusioned with the thuggery and corruption of the mainstream Christian parties.
Mr Aoun styled himself as a healer rather than a divider, even if the reality was that he and Hizbollah needed each other. The party needed Christian cover in the post-Syrian era, while Mr Aoun wanted Hizbollah to carry him to the presidency.
Ten years on and Mr Aoun is an old, and apparently sick, man. He probably will not be president, but he and his allies in Hizbollah are still holding the country hostage. There has been no president for two years, a situation that has severely hindered the day-to-day running of the country and no doubt done little to encourage investment confidence.
The good news is that things have changed since the heady days of 2006, when Hizbollah bathed in its Pyrrhic victory over Israel. Since 2011, the party deviated from its core business of resisting Israel and unilaterally entered the Syrian civil war on the side of the Assad regime. Now, the walls are closing in on the party as its constituents question the body count in a war against fellow Arabs. Meanwhile, the foreign community, led by the United States, wants to go after the party’s finances and is applying pressure on the Lebanese banking system, an institution older than the country itself and one on which the country’s very economic survival rests. On June 12, someone planted a bomb at the headquarters of Blom Bank in the centre of Beirut.
It’s time for that referendum.
Michael Karam is a freelance writer who lives between Beirut and Brighton.
business@thenational.ae
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