Lebanon suffers from Saudi-Iranian rivalry

Lebanon suffers from Saudi-Iranian rivalry

Tensions between Saudi Arabia and Iran are palpable: the use of Lebanon for proxy power plays has some serious repercussions particularly in relation to Saudi-aligned Gulf States.

Lebanon boasts an array of beaches and resorts dotting a charismatic coast, snowcapped mountains and picturesque ski chalets. On the other hand, it is crippled by political deadlock and has absorbed more than a million and a half refugees into a population of four and a half million

Lebanon faces isolation from GCC states

Lebanon remains in a state of political gridlock, with no acting president in place since 2014. A recent parliamentary election date passed on March 23, 2016; predictably leaving the Mediterranean country without a clear legislative future. Lebanese political tensions exhibit a clear link between government deadlock and the Saudi-Iranian power struggle. These facets can also be seen as the root for current implications to security and stability.

Since the summer of 2015, Lebanon has made the news not only due to security issues, but also for ‘rivers’ of garbage blocking roads and sparking massive demonstration actions across the capital and beyond. Infrastructural fragility is directly connected to a lack of good governance, and alone could be a cause for future unrest if the current garbage overflow solutions fall through in the near to mid-term.


Lebanon’s garbage crisis continues

In February, Saudi Arabia withdrew at least $3 billion in funding from Lebanon’s army due to ongoing complacency with regards to Iranian-backed Hezbollah and its importance within Lebanon and beyond. In early March, the Gulf Cooperation Council (GCC) officially classified Hezbollah as a ‘terrorist group;’ under Saudi Arabia’s direction, while simultaneously placing travel warnings on GCC nationals wishing to visit Lebanon: the UAE even instilled an outright ban on their nationals, and refused entry visas to a Lebanese delegation.

This has minimal but obvious ramifications on individuals who relied upon GCC tourism: in the past several years, it was not uncommon to see cars showing license plates from GCC countries on Beirut’s roads, fleeing the humid summers of the Gulf. Tourism is down from a year ago, as hotel room averages have sunk 18.9 percent in 12 months: some sources tie this phenomenon to the recent dearth of wealthy visitors from the Gulf.

In February, several Lebanese nationals were expelled from Saudi Arabia as relations worsened. Furthermore, in mid-March several Lebanese were expelled from Bahrain due to alleged ties to Hezbollah. Kuwait is the latest to undertake similar actions, cancelling the residencies of 60 Lebanese expats on March 27th.

The repercussions

There are two possible direct results of these phenomena. The first is that fewer GCC nationals will choose Lebanon as a holiday destination, thereby impacting tourism revenue at least on some level. Secondly, Lebanese expats living in some GCC countries may be refused access for residency or work permits in the coming weeks and months, due to real or perceived links to Hezbollah, or generalizations that aim to pressure Lebanon into standing against Iran and more specifically, Hezbollah. How would this impact Lebanon’s GDP rates?

Approximately between 15 and 20 percent of Lebanon’s GDP is derived from remittances. Currently, half of all the remittances sent back to Lebanon are from sources in the Gulf. As a result, regional tensions that continue to come to a head will  impact people in Lebanon relying on foreign earned income, as well as Lebanese who have built lives for themselves in the Gulf.

Clearly, the crisis in Syria has exacerbated Lebanon’s security and economic situation in subtle as well as more explicit ways. However, continuing power plays between Saudi Arabia and Iran merely intensify sectarian divides that were sown after the exit of colonial powers in the mid-20th century.

Lebanon is able to thrive amidst instability on its doorstep, yet further attempts to isolate the country due to its political-sectarian issues, including enhanced scrutiny on Lebanese expats in the GCC could have a destabilizing effect on the Lebanese economy. Specifically, isolation by the GCC will impact tourism revenue in Lebanon, and pose risks to much-needed remittances from GCC-based Lebanese citizens.

The possibility of ongoing expulsions of Lebanese nationals from GCC countries could have unfortunate repercussions on the Lebanese economy in the mid to long-term, furthering regional instability and increasing the impact of the Syrian crisis on its doorstep.

About Author

Kira Munk

Kira Munk is a political risk analyst located in the DC Metro area, and has lived in Lebanon and Egypt and the UAE. Kira focuses on topics related to terrorism and counterterrorism, human rights, and the impacts of social and political developments in the MENA. She holds a Master's degree in Terrorism, Security & Society from the Department of War Studies at King's College London.