As the situation in Israel and the Palestinian areas has deteriorated in the past week, Lebanon's Hezbollah has watched developments closely. The party welcomes much of what has happened, but it is too early for it to celebrate. Palestinian gains are more likely than not to affirm Hezbollah's limited appeal.
Hezbollah's assessment will be primarily focused on what the conflict has meant for Iran and its regional allies, rather than on how it has advanced the interests of the Palestinian people. Hezbollah will have welcomed Hamas's ability to bring Israel to a relative standstill while continuing to fire at Israeli targets, despite the ferocious bombardment of Gaza.
Much like Hezbollah in the Lebanon war of 2006, Hamas's ability to hit Israel has represented a moral victory to its supporters, regardless of Israel's more massive destruction of Palestinian areas. There has also been an improvement in the quality and range of Hamas's weapons, so that the organisation has inflicted damage as far away as Tel Aviv and Jerusalem, even forcing Israel to close its international airport.
Hamas’s potency signals the group’s full reintegration into the “resistance axis", the coalition of Iranian-led countries and armed groups opposed to Israel and the US. The ties between Hamas and Hezbollah, which had deteriorated during the Syrian conflict, improved markedly in 2017. The latest round of fighting in Gaza takes the reconciliation process a step further.
Hezbollah will have also welcomed that Hamas largely sidelined the Palestinian Authority in the clash with Israel over its storming of Al Aqsa Mosque last week. After the expulsion efforts in Sheikh Jarrah, it was Hamas that bombed Israeli targets. Though this condemned Gazans to new destruction, politically it underlined the ineptitude of the Ramallah-based Palestinian leadership, which had already discredited itself by postponing legislative elections on April 30.
A third development Hezbollah will have watched with satisfaction is that the Palestinians of Israel joined the protests against the Israeli government, creating the semblance of a broad Palestinian front in favour of Palestinian rights. To Hezbollah, this suggests that Israel's contradictions are coming to the fore, which in the party's eyes confirms its argument that the country is not viable.
And fourth, Hezbollah, like Iran, will probably have regarded Hamas's strikes against Israel as payback for Israel's bombing of Iranian combatants and proxies in Syria. Tehran can claim that it has imposed a deterrence relationship with Israel. Hamas cannot retaliate for each Israeli attack on Iranian or allied forces in Syria, but the effect of what is happening in Gaza on Israel's domestic stability is more potent than the domestic consequences of what Iran has suffered in Syria.
Despite all this, Hezbollah should be careful about claiming victory too soon. There is little doubt that the latest Gaza war, because it was coupled with protests inside Israel’s 1948 borders, has represented an important new turn in the Palestinian-Israeli relationship. Moreover, the emotions provoked regionally have shown that “Palestinian resistance", which Iran and its regional allies claim to champion, continues to pack a powerful punch, particularly in the face of Israel’s injustices.
However, precisely because of that, Palestinians will take their actions as a continuation of generations of national struggle, in which Iran’s and Hezbollah’s roles are only secondary. Nor is Hamas seen by most Palestinians as a vanguard in their fight for self-determination. In a poll by the Palestinian Centre for Policy and Survey Research last March, prior to the expected elections, only 22 per cent of respondents (15 per cent in the West Bank and 33 per cent in Gaza) wanted Hamas to lead the next Palestinian Authority government.
Palestinians will take their actions as a national struggle in which Iran's and Hezbollah's roles are secondary
One can expect Palestinian citizens of Israel to take an even dimmer view of Hamas. Palestinian national liberation remains primarily a secular and nationalistic phenomenon, with few ties binding it to Iran’s regional agenda.
Nor has the "resistance axis" been able to transform the fighting in Gaza into a weapon to place its Arab rivals on the defensive. The Organisation of Islamic Co-operation immediately condemned Israeli actions last week and held a foreign ministers' meeting on Sunday. At the virtual gathering, the Saudi Foreign Minister, Prince Faisal bin Farhan, described Israel's "systematic crimes" and notably reaffirmed the Arab Peace Initiative of 2002, which Israel has largely ignored.
The fighting also failed to have an impact on the agreements last year between several Arab states and Israel. This suggests that the long-term significance of the Gaza fighting is more likely to be felt internally and in the occupied territories, affecting Israel’s relations with Palestinians at home and under Israeli rule, than to transform the relationship between Israel and regional actors.
While Hezbollah may relish the fact that the weapons of the “axis of resistance” are causing more damage in Israel, it should remember that in any war Israel is far more capable of escalating to higher levels of devastation than its enemies. In Hezbollah’s case, the party’s challenge will be containing the popular backlash after any war, because few Arabs are willing to lose everything on Iran’s behalf.
Michael Young is a senior editor at the Carnegie Middle East Centre in Beirut and a Lebanon columnist for The National
A man watches a factory in the northern Gaza Strip burn after it was hit by what witnesses said was an Israeli artillery bombardment. Reuters
Israeli army tanks fire shells from a position by the border into the Gaza Strip. AFP
Palestinian firefighters douse a fire at the Foamco mattress factory following an Israeli air strike to the east of Jabalia in the northern Gaza Strip. AFP
A Palestinian firefighter takes part in efforts to put out a fire at a factory in the northern Gaza Strip after it was hit by Israeli artillery shells. Reuters
Palestinian firefighters at a factory in the northern Gaza Strip that witnesses say was hit by Israeli artillery shells. Reuters
Fire and smoke rise over Gaza city as Israeli warplanes attack the Palestinian enclave. AFP
Smoke and flames rise above a building during Israeli air strikes, amid a flare-up of Israeli-Palestinian violence, in Gaza city. Reuters
Seen from Ashkelon in Israel, a missile from Israel's Iron Dome air defence system leaves a bright trail as it moves to intercept rockets launched from the Gaza Strip. Reuters
Israeli soldiers next to an ammunition carrier at their position by the border with the Gaza Strip. AFP
THE BIO
Favourite author - Paulo Coelho
Favourite holiday destination - Cuba
New York Times or Jordan Times? NYT is a school and JT was my practice field
Role model - My Grandfather
Dream interviewee - Che Guevara
Avatar: Fire and Ash
Director: James Cameron
Starring: Sam Worthington, Sigourney Weaver, Zoe Saldana
Rating: 4.5/5
Washmen Profile
Date Started: May 2015
Founders: Rami Shaar and Jad Halaoui
Based: Dubai, UAE
Sector: Laundry
Employees: 170
Funding: about $8m
Funders: Addventure, B&Y Partners, Clara Ventures, Cedar Mundi Partners, Henkel Ventures
Profile box
Company name: baraka
Started: July 2020
Founders: Feras Jalbout and Kunal Taneja
Based: Dubai and Bahrain
Sector: FinTech
Initial investment: $150,000
Current staff: 12
Stage: Pre-seed capital raising of $1 million
Investors: Class 5 Global, FJ Labs, IMO Ventures, The Community Fund, VentureSouq, Fox Ventures, Dr Abdulla Elyas (private investment)
The specs
Engine: 3.6 V6
Transmission: 8-speed auto
Power: 295bhp
Torque: 353Nm
Price: Dh155,000
On sale: now
Northern Warriors v Team Abu Dhabi, 3.30pm
Bangla Tigers v Karnataka Tuskers, 5.45pm
Qalandars v Maratha Arabians, 8pm
Spider-Man: No Way Home
Director: Jon Watts
Stars: Tom Holland, Zendaya, Jacob Batalon
Rating:*****
What drives subscription retailing?
Once the domain of newspaper home deliveries, subscription model retailing has combined with e-commerce to permeate myriad products and services.
The concept has grown tremendously around the world and is forecast to thrive further, according to UnivDatos Market Insights’ report on recent and predicted trends in the sector.
The global subscription e-commerce market was valued at $13.2 billion (Dh48.5bn) in 2018. It is forecast to touch $478.2bn in 2025, and include the entertainment, fitness, food, cosmetics, baby care and fashion sectors.
The report says subscription-based services currently constitute “a small trend within e-commerce”. The US hosts almost 70 per cent of recurring plan firms, including leaders Dollar Shave Club, Hello Fresh and Netflix. Walmart and Sephora are among longer established retailers entering the space.
UnivDatos cites younger and affluent urbanites as prime subscription targets, with women currently the largest share of end-users.
That’s expected to remain unchanged until 2025, when women will represent a $246.6bn market share, owing to increasing numbers of start-ups targeting women.
Personal care and beauty occupy the largest chunk of the worldwide subscription e-commerce market, with changing lifestyles, work schedules, customisation and convenience among the chief future drivers.
Starring: Abdulla Zaid, Joma Ali, Neven Madi and Khadija Sleiman
Two stars
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.”
