The injuries and deaths in Lebanon in the past week, as pagers and walkie-talkies in the possession of Hezbollah members exploded, represented a new moment in the nearly year-long battle between Hezbollah and Israel over the Gaza conflict.
The Israelis’ ability to booby-trap the devices showed that they have a panoply of potential actions they can use against a group severely constrained in its actions. This was only reaffirmed last Friday, when the Israelis killed the most senior Hezbollah military leader, Ibrahim Aqil, and several commanders from its elite Radwan Force. And Israel took this a step further on Monday, when it succeeded in displacing a portion of the Shiite population of southern Lebanon and the western Bekaa Valley, after attacks that killed more than 500 people and injured over 1,600.
From the start of the fighting on October 8 of last year, Hezbollah was caught between contradictory imperatives. On the one hand, it had to come to Hamas’s assistance in Gaza in defence of a strategy developed with Iran known as the "unity of the arenas" strategy. The idea was that parties in the Iran-led Axis of Resistance would combine their efforts to combat Israel if one of them came under Israeli attack.
On the other hand, Hezbollah had to avoid a widening of the conflict with Israel that might lead to Lebanon’s destruction. The country’s economic collapse in 2019-2020, the growing sectarian hostility towards the group from elements in the Sunni, Maronite and Druze communities, and Hezbollah’s unpopular hegemony over the Lebanese state meant that the group’s leadership understood the real risks that a devastating war might have for its ability to prevail in the aftermath.
An essential element in the Unity of Arenas strategy was that it was based on the capacity of the Axis of Resistance to deter Israel. Until recently, it had managed to do so to a significant extent, although this did not prevent Israel’s devastation of Gaza and the mass killing of Palestinians. However, Hezbollah’s limits domestically also illustrated the vulnerabilities of the most powerful Axis of Resistance member.
By intensifying its attacks against Hezbollah over the past week, the Israelis showed that a gap was growing in the deterrence relationship between the two sides. As the Israelis were escalating their actions, Hezbollah seemed increasingly incapable of responding in kind. If so, what does this hold for the "unity of the arenas" strategy?
There were always profound risks in the thinking behind the strategy. All the countries or territories in which the Axis of Resistance is present – Lebanon, Syria, Iraq, Yemen and Gaza – are highly vulnerable in the event of Israeli retaliation. The reason for this is that Iranian regional power was built on a wasteland: wherever Iran and its allies intervened, they left behind failed or failing states.
One might assume that this played in favour of Iran’s allies, since the absence of functioning states meant Axis of Resistance members could do what they pleased, without opposition. But this reality doesn’t quite hold in Lebanon, where the country’s complex sectarian make-up and traditionally weak state have meant that religious communities and sectarian identities are much stronger than elsewhere.
While such communal identities may have widened divisions enabling Hezbollah’s hijacking of the Lebanese state, they have also created outposts of resistance and resentment to Hezbollah that the group has failed to overcome, but is sometimes mindful not to exacerbate. Yet it is also a measure of Hezbollah’s hubris that it largely disregarded this when embracing the "unity of the arenas" strategy.
By dialling up its attacks against Hezbollah over the past week, the Israelis showed that a gap was growing in the deterrence relationship between the two sides
With Gaza and large areas of southern Lebanon destroyed and Hezbollah struggling to keep up with Israel in imposing a deterrence equation, it may be time to reassess the "unity of the arenas" concept. Several factors underline why: Gaza has been obliterated; Hezbollah simply cannot afford a wider war; and the Syrian government, fearing Israel’s response, has shown that it will not open a new front against Israel.
What kind of value does this strategy have if, increasingly, the arenas are less and less unified, and less and less capable of keeping up with Israel’s escalations? If a full-scale war happens in Lebanon, for instance, Hezbollah may not be able to count on effective intervention by its allies. Neither its Iraqi nor its Yemeni allies can do much, Syria may hesitate to allow Iran’s allies to cross its territory to wage a war with Israel, and there are no guarantees that Iran will risk a war with the US by entering the fray.
Given all this, quiet abandonment of the "unity of the arenas" strategy once the current conflict ends, or even before, may be the best option. Israel’s ravaging of Gaza has already crippled the strategy by nullifying much of its Palestinian component. However, Hezbollah is unlikely to admit to such a retreat publicly. The strategy has become a pillar of Iran’s regional credibility, so its loss would be a major blow.
One question that needs to be asked is, who came up with the "unity of the arenas" idea in the first place? Since Hezbollah’s secretary general, Hassan Nasrallah, first publicised the idea early last year, it had the potential to be less of a strategy than a mutual suicide pact. It hasn’t actually become that, and to an extent has succeeded in reconfirming Iran’s regional reach.
However, the strategy has now come to be defined far more by its inadequacies than its possibilities. If Hezbollah, the strongest actor in the "unity of the arenas" approach, is now finding it challenging to deter Israel, what of its regional allies? Continuing on this path will probably only further widen the disparity between the Axis of Resistance, on the one side, and Israel and its US patron, on the other.
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Uefa Champions League semi-final, first leg
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The calling app is available to download on Google Play and Apple App Store
To successfully install ToTok, users are asked to enter their phone number and then create a nickname.
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Users can also invite other contacts to download ToTok to allow them to make contact through the app.
Farage on Muslim Brotherhood
Nigel Farage told Reform's annual conference that the party will proscribe the Muslim Brotherhood if he becomes Prime Minister.
"We will stop dangerous organisations with links to terrorism operating in our country," he said. "Quite why we've been so gutless about this – both Labour and Conservative – I don't know.
“All across the Middle East, countries have banned and proscribed the Muslim Brotherhood as a dangerous organisation. We will do the very same.”
It is 10 years since a ground-breaking report into the Muslim Brotherhood by Sir John Jenkins.
Among the former diplomat's findings was an assessment that “the use of extreme violence in the pursuit of the perfect Islamic society” has “never been institutionally disowned” by the movement.
The prime minister at the time, David Cameron, who commissioned the report, said membership or association with the Muslim Brotherhood was a "possible indicator of extremism" but it would not be banned.
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.”