'All options are open' for Lebanon-Israel front, Hassan Nasrallah says


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Hassan Nasrallah, the leader of Hezbollah, delivered his first speech since cross-border clashes erupted weeks ago between Israel and armed militant groups following an unprecedented attack by Hamas on October 7, raising concerns of a regional spillover.

Hamas's battle “has extended to more than one front and more than one arena”, Mr Nasrallah said. He added that Hezbollah had “entered the battle on October 8" and warned that the chance of open conflict was “realistic”.

“This glorious operation has caused an earthquake within the Zionist entity,” he said in his speech, which was broadcasted live and shown on large screens across the country. In Beirut's southern suburb of Dahieh, thousands of people gathered in a large plaza to watch.

“These operations have created fear in the Israel enemy: military, security and psychological fear that will have strategic consequences on the entity, both in the present and in the future,” he said.

Washington's support for Israel was also condemned by the Hezbollah leader.

“You, the Americans, can stop the aggression against Gaza because it is your aggression,” he said.

The US “will not engage in a war of words” with Hezbollah’s leadership, a White House National Security Council official said on Friday, warning that the war could escalate into one “bloodier” than the 2006 Israel-Gaza war.

“The United States does not want to see this conflict expand into Lebanon. The likely devastation for Lebanon and its people would be unimaginable and is avoidable,” the official told The National.

Thousands cheered as the Hezbollah leader gave his long-awaited speech, which came after the most intense night of cross-border fighting. Israel pummelled southern Lebanon on Thursday night, killing four, after a volley of rockets were fired across the border.

Supporters of Hezbollah wave flags as they watch a televised speech by its leader Hassan Nasrallah in the Lebanese capital Beirut's southern suburbs on Friday. AFP
Supporters of Hezbollah wave flags as they watch a televised speech by its leader Hassan Nasrallah in the Lebanese capital Beirut's southern suburbs on Friday. AFP

The group claimed responsibility for a simultaneous attack on 19 Israeli military positions, while the military wing of Hamas, Al Qassam Brigades, said it fired 12 rockets from southern Lebanon into the Israeli city of Kiryat Shmona “in response to the massacre in Gaza”.

Mr Nasrallah has been silent since October 8, when Hezbollah opened the floodgates to a regional multi-front war of attrition in support of its ally Hamas.

In Lebanon, which has no president, no empowered government and no functioning parliament, the absence of any meaningful stances by the country's leadership, citizens – even opponents of the Iran-backed party Hezbollah – often look to Mr Nasrallah for insight on their country's foreign policy.

Twenty-one-year old Mohammad said he had travelled from south Lebanon's Tyre city and began tailgating at the plaza in the morning, “just to hear the Sayyed talk”. The plaza was already packed by 10am, he said.

His friend, who preferred to stay anonymous, told The National he had come to the plaza with a group of friends and his family, and that “my neighbours, and their neighbours and all of Dahieh is here”.

'All options are open' in tit-for-tat war of attrition

The clashes along the Lebanon-Israel border have been contained so far, but there is growing concern that any miscalculation or sudden violence could trigger a broader regional conflict, pitting Israel against Iranian proxies.

Mr Nasrallah reinforced the notion, although he stopped short of declaring full war on Israel.

“Every Israeli escalation will be met with a similar action from us. For every civilian, a civilian,” he said forcefully.

“All options are open on the Lebanese front. All options are on the table, and we are ready for all possibilities.”

The death toll in Lebanon since the Israel-Hamas conflict began now stands at 71, as reported by AFP. This count includes mostly Hezbollah fighters and other combatants, but it also includes at least seven civilians, one of whom was a Reuters journalist.

Military strategy

In his speech, the Hezbollah leader explained that the group's strategy for initiating a border war between Lebanon and Israel had succeeded in diverting a significant amount of the Israeli military's forces from Gaza.

Israel's armed forces had been diluted, he said, with a third of its army, half of its naval forces and a quarter of its air force diverted from Gaza to Lebanon.

The group had also succeeded in displacing “tens of thousands of residents from 58 settlements” from northern Israel.

The escalation between Israel and Hezbollah intensified after Israel announced the “second stage” of its operations in Gaza on Friday, marked by increased bombardment and the start of ground operations in the blockade strip.

“Since I was a kid, I heard about the West being champions of human rights,” said Hussein, who also came to watch the speech. “Where are they now? They are all supporting Israel and its crimes, they are all supporting oppression, even Arab countries.”

Hezbollah swiftly endorsed Hamas's deadly attack by commencing a border confrontation, with rockets launched into the occupied Chebaa territories on October 8. The group cited rising Israel incursions into Al Aqsa in Jerusalem, growing settlement expansion and violence in the West Bank, and the ongoing blockade of the Gaza Strip.

But, the leader said, “Al Aqsa Flood operation was 100 per cent a Palestinian decision”, implying that Iran and Hezbollah did not have a hand in engineering the operation.

Axis of Resistance

“The Islamic Republic of Iran openly supports the resistance movements in Lebanon, Palestine and the region, but it does not exert control over their leadership,” Mr Nasrallah said. “The decisions of the resistance belong to the leadership of the resistance.”

On Thursday night, Iraqi militia groups claimed that a drone was fired towards Israeli positions on the Dead Sea, while Yemen's Houthi rebels said on Tuesday they had launched three drone and missile attacks towards Israel since the start of the war, vowing to continue such attacks “to help the Palestinians to victory”.

“Iran is pushing its proxies around us, the Houthis, Hezbollah and others, in order to distract us from focusing on Hamas and Gaza,” said Israeli military spokesman Rear Admiral Daniel Hagari on Thursday.

“In the north, the IDF will respond with action, not with words. The IDF is on high alert.”

Iranian Foreign Minister Hossein Amirabdollahian said on Sunday that Iran does not want war to “spread out”.

People in the region were angry, he said, and “they are not receiving orders from us”.

“They act according to their own interest. Also, what happened, what was carried out by Hamas, it was totally Palestinian.”

The White House National Security Council official said: “We and our partners have been clear: Hezbollah and other actors – state or non-state – should not try to take advantage of the ongoing conflict.”

But Hezbollah's leader advised the US to be cautious in their approach to the conflict, saying during his speech: “The Americans would not only be striking Lebanon – they would also have to strike Iran.”

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Updated: April 08, 2024, 9:52 AM