How COVID-19 Exacerbates Lebanon’s Mounting Economic, Political Woes

COMMENTARY Middle East

How COVID-19 Exacerbates Lebanon’s Mounting Economic, Political Woes

Apr 16th, 2020 6 min read

Commentary By

James Phillips

Senior Research Fellow, The Heritage Foundation

Nicole Robinson

Research Assistant, The Allison Center for Foreign Policy

Lebanese President Michel Aoun wears a face mask during a meeting to evaluate measures taken against the spreading of the coronavirus at Baabda Palace in Beirut on March 26, 2020. Anadolu Agency / Contributor / Getty Images

Key Takeaways

Lebanon—already crippled by overlapping political, economic, and regional crises—faces catastrophic consequences from the COVID-19 pandemic.  

Lebanon has many vulnerabilities that could contribute to a perfect storm.

Regardless of the efforts by traditional political elites, nearly half of Lebanon’s population could end up living below the poverty line post-pandemic.

Lebanon—already crippled by overlapping political, economic, and regional crises—faces catastrophic consequences from the COVID-19 pandemic.  

The worsening public health crisis has magnified Lebanon’s severe economic, fiscal, and foreign-debt problems and has undermined efforts to address other critical issues, such as corruption, sectarian tensions, and poor governance.  

Even worse, the pandemic is likely to exacerbate Lebanon’s political instability, fuel conflict between rival political factions competing to secure scarce medical resources for their supporters, and aggravate tensions between Lebanese citizens and desperate refugees who have flooded in from neighboring Syria.

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Lebanon is facing its worst crisis since the end of its civil war in 1990 as it struggles to cope with the effects of COVID-19, the disease caused by the new coronavirus, hampered by an economy that already was on the verge of collapse and a new government that’s struggling to gain legitimacy. 

A Looming Perfect Storm

Lebanon has many vulnerabilities that could contribute to a perfect storm. Ruled by a weak and dysfunctional government that is distrusted by many—if not most—Lebanese citizens, the country has large numbers of urban poor living in cramped quarters.  

Lebanon also hosts 1.5 million Syrian refugees, the highest per-capita ratio of refugees to citizens in the world. Many of the refugees live in tents or squalid buildings where social distancing and regular hand-washing are nearly impossible.   

The coronavirus could not have hit Lebanon at a worse time. Just a month after Lebanon’s newly appointed prime minister, Hassan Diab, formed the new government on Jan. 21, the first cases of coronavirus began to appear. On March 15, President Michel Aoun declared a medical state of emergency in Lebanon. 

Lockdown measures, such as the closure of nonessential businesses and banks, as well as a curfew, were later implemented to slow the spread. 

Though Lebanon’s health care system is considered relatively strong, the financial crisis has caused medical-supply shortages, heightening fears that the number of cases could surge without proper supplies to treat patients. 

The number of cases reported is just over 650 infected, with 21 dead, as of April 15, although the actual numbers are suspected to be much higher. 

As the country continues to battle the virus, economic and political ramifications are already starting to play out. 

An Economic House of Cards

The economy is close to collapse. The Lebanese lira has depreciatedby more than 60% of its value since October, causing price hikes of essential imported goods, while an estimated 17% of the workforce have been out of jobs since September. 

With more than $90 billion in debt, Lebanon is saddled with the third-highest debt-to-gross domestic product ratio in the world. Interest payments consume almost half of government revenues, and the debt burden is likely to grow heavier. 

Before the COVID-19 lockdown-induced economic slump hit, Lebanon’s GDP was projected to fall by an estimated 12% in 2020. The closure of Lebanon’s bars, restaurants, nightclubs, and many other small businesses, combined with declining remittances from expatriate Lebanese workers in foreign countries, leaves little hope that the country can recover anytime soon.

The result might be that the health crisis triggers a second wave of anti-government protests after the pandemic. 

Since October, Lebanon has been wracked by mass protests against the governing elite. A new tax on messaging apps ignited spontaneous demonstrations against the entrenched and corrupt political oligarchs who long have failed to deliver adequate basic services while siphoning off state resources to feather their own nests and enrich their cronies. 

Though the multisectarian protest movement did pressure then-Prime Minister Saad Hariri to resign in late October, his government has been replaced by a new coalition government dominated by Hezbollah, the Iran-backed Shiite extremist movement. 

Hezbollah, a major target of the protests, seized on the coronavirus outbreak as a convenient pretext to put an end to mass demonstrations. 

On March 27, Lebanese security forces dismantled tents and forcibly evicted demonstrators in Martyrs’ Square in Beirut, the epicenter of the protest movement. Citing social distancing and the implementation of the curfew, the government has used the virus outbreak as an excuse to suppress the protest movement. 

That has forced the protesters to continue the movement through social media. Public seminars have now transitioned online, including both political and educational sessions. 

Activists continue to stress the deep suffering of the Lebanese people, worsened by the government’s slow response to the crisis. In the absence of government leadership, activists and protesters fear the resurgence of traditional political actors who have stepped up in recent weeks to compensate for weak public institutions. 

Controlling the Health Ministry under Diab’s new government, Hezbollah’s Islamic Health Unit is leading the government-effort in combating the virus.

The group claims to have mobilized 24,500 members and volunteers and allocated $2.3 million in a public relations campaign to highlight its governance services and social-welfare networks. Food items have been delivered to people in need, COVID-19 testing sites have been set up, and ambulances were made ready to care for patients. 

Other sectarian political parties have also stepped up their patronage efforts to bolster their damaged images. Political parties such as the predominantly Christian Free Patriotic Movement, the rival Christian Lebanese Forces Movement, the Shiite Amal Movement, and the Druze-led Progressive Socialist Party have implemented awareness campaigns, delivered food packages, and made donations to help hospitals in their communities. 

Like Hezbollah, these groups are trying to gain back the influence and political support that has been lost since the protests mushroomed in October. 

Viral Propaganda Battles

The rival political parties also have engaged in a blame game about the source of Lebanon’s coronavirus outbreak.  

Hezbollah, which long has served as Iran’s terrorist surrogate, was accused of stalling a ban on travel from Iran, a major conduit for the transmission of the virus from China to the Middle East.  

Hezbollah undoubtedly wanted to protect the image of its Iranian patron and to satisfy its own logistical needs, which include massive transfers of increasingly sophisticated Iranian rockets and precision-guided weapons. It responded with a propaganda campaign that blamed Lebanon’s health crisis on Catholic clerics returning from Italy. 

Regardless of the efforts by traditional political elites, nearly half of Lebanon’s population could end up living below the poverty line post-pandemic. The government has so far refused an International Monetary Fund bailout, meaning that there is little hope for a stimulus package to compensate for lost businesses or a massive loan to finance the purchase of essential imports, food, and medical supplies. 

Unless the Lebanese government takes serious steps to regain popular support by rooting out corruption, digging itself out of its economic hole, and providing clear leadership during this health crisis, round two of protests could trigger political turmoil that may be the straw that breaks the camel’s back. 

For more information on this topic:

Middle East Coronavirus Data Sketchy, Leaving Populaces to Suffer  

Why Protests Rocking Lebanon Forced Out the Prime Minister

How Protests Undermine Iran and Its Proxies in Iraq and Lebanon

Iran’s Coronavirus Propaganda Scapegoats America

Iranian Regime’s Reckless Disregard Made the Coronavirus Outbreak Worse

This piece originally appeared in The Daily Signal