arab-isolation-economic-collapse
Lebanese Minister of Information George Kordahi(Archives)

The crisis erupted between Lebanon and Saudi Arabia, with the latter announcing the withdrawal of its ambassador from Beirut, giving the former’s ambassador to leave within 48 hours, and stopping all Lebanese imports into the Kingdom.

The new crisis complicates the scene in Lebanon and pushes this country towards further isolation and collapse, deepening the political and economic crises it has been experiencing for more than two years.

The crisis with Saudi Arabia may turn the scales in Lebanon upside down, and push its officials towards new accounts, less than two months after the formation of a government that the Lebanese hoped would stop the economic and living collapse in their country.

And the Lebanese Minister of Information, George Kurdahi, considered during a television interview on Monday (recorded last August) that the Houthis in Yemen were “defending themselves against the attacks of Saudi Arabia and the UAE.”

As a result, Saudi Arabia, the Emirates, Kuwait, and Bahrain announced, on Thursday, the recall of Lebanon’s ambassadors to them, and informed them of its protest against Qardahi’s statements.

The country’s President Michel Aoun and Prime Minister Najib Mikati confirmed that “Qardahi’s statements were before his appointment as a minister, and do not reflect the state’s point of view, which is keen on the best relations with Arab countries.”

Over the course of two days, the reactions continued until Riyadh announced on Friday that it had summoned its ambassador to Lebanon, Walid Bukhari, for consultations.

Political repercussions and government confusion

This decision constitutes a dangerous turning point in the history of relations between the two countries and may have additional political and economic repercussions on Lebanon, which is burdened with crises of all kinds and confuses the government even more.

The writer and political analyst Mounir Al-Rabee said, “The Saudi measures were expected, especially since Riyadh’s (escalatory) position is not only related to Qardahi’s position, but rather as a result of a crisis that extends for several years with Lebanon.”

Al-Rabie added in his comment to The Eastern Herald, explaining that “Lebanon has not taken any measures to arrange the relationship with the Gulf countries after it declined in the last period.

A message to Mikati

Al-Rabie saw that the Saudi move is a basic message for the government of Najib Mikati, which Riyadh considers to be the government of “Hezbollah”, as described by the spokesman.

Mikati had expressed more than once that he seeks to correct Lebanon’s relationship with Saudi Arabia, and this is what was stated in his government’s work program that “one of its priorities is to work on restoring historical relations and ties between Lebanon and its Arab brothers.”

Historically, distinguished relations prevailed between Riyadh and Beirut, but they became tense in 2017, as Saudi Arabia accused Hezbollah of controlling the political and security decision in Lebanon, as well as its intervention in the Yemen war with the support of groups working against it.

Among the most prominent diplomatic tensions between the two countries, was last May, following statements by the Lebanese Foreign Minister at the time, Charbel Wahba, in which he said that “the Gulf countries supported the rise of the terrorist organization ISIS in the region.”

Isolation with the Arabs

Al-Rabie pointed out that “the atmosphere in Saudi Arabia indicates that Lebanon will be isolated with the Arabs and that what happened is an indication that Beirut is moving away from the Arabs and getting closer to the Iranian axis (represented by “Hezbollah” in the country).”

He added, “Saudi Arabia may not think of an actual return to openness to Lebanon except with a clear Lebanese program based on correcting the foreign policy of the Lebanese state, and adopting a balanced policy with the Arabs that distances Lebanon from the policy of axes.”

Some Lebanese politicians, including members of parliament, demanded Qardahi’s resignation, but Hezbollah refused to dismiss him or push him to resign, describing his position as “honorable and brave.”

Economic repercussions

The diplomatic escalation by Riyadh included stopping all Lebanese imports to Saudi Arabia, which would result in financial losses for Lebanon and deepen its economic crisis, which the World Bank classified as among the 3 worst economic crises in the world.

In this regard, economic expert Walid Abu Suleiman said that “the repercussions of this decision will weigh on the Lebanese industry and food and agricultural products.”

He continued with The Eastern Herald: “These repercussions will affect the revenues of the private sector, and cause a decline in the entry of foreign exchange into Lebanon, which constitutes an additional setback for the economy in the country.”

The economic expert feared that the Saudi decision would be followed by other similar decisions from other Gulf countries, because the Gulf Cooperation Council countries usually stand in solidarity with each other in such issues, according to the spokesman.

In 2019, the value of Lebanon’s exports to Saudi Arabia amounted to $282 million, but Riyadh’s decision on Friday, which included “stopping all Lebanese imports”, meant freezing this process.

Stopping Millions of Dollars Exports

According to economist Patrick Mardini, the economic and financial cost to Lebanon will be very expensive due to the severing of trade relations on the one hand, and the decline in Saudi investments in Lebanon on the other.

Mardini pointed out to The Eastern Herald that the two countries that import the most goods from Lebanon are the UAE and Saudi Arabia, followed by Syria, South Africa, and Iraq.

According to figures for 2018, Lebanon’s exports to the UAE amounted to 450 million dollars, while exports to Saudi Arabia amounted to 212 million dollars, meaning that these two countries account for 23 percent of Lebanon’s total exports.

According to Mardini, “stopping exports from Lebanon to Saudi Arabia or the UAE constitutes a severe economic blow to the country’s productive sectors, especially the agricultural and industrial sectors.”

As for Saudi investments in Lebanon, Mardini pointed out that “many Saudi businessmen invest in Lebanon, especially in the tourism, hotel, media and other sectors.”

And he indicated that “these investments have always constituted an injection of foreign funds into Lebanon, which constitute part of the domestic product, and therefore their cessation means a loss of those funds, which causes an additional decline in the abundance of foreign exchange.”

© The Eastern Herald
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