COVID-19 multiplies Lebanon's political and economic instability

The COVID-19 pandemic has accentuated an already devastating economic crisis and exposed deficiencies in Lebanon's social protection systems. Already crippled by the longstanding political, economic and regional crisis, the country faces catastrophic consequences from the coronavirus pandemic. With X cases of infection and X deaths in a population of seven million people, the increase in cases is of particular concern because of the lack of means and personnel in the health system.

According to Human Rights Watch, “the blockade to stop the spread of COVID-19 has exacerbated poverty and rampant economic hardship in Lebanon before the virus arrived”. Millions of Lebanon's residents are at risk of starvation because of the pandemic-related closure measures.

On 15 March, the Lebanese Government urged people to stay home until 26 April. On 1 April, the cabinet announced that it would distribute 400,000 Lebanese pounds (about $250) to the most vulnerable families, but they have not provided many details. The administration also announced the disbursement of 75 billion Lebanese pounds, about $28 million, to address the economic and social crisis resulting from the spread of the pandemic.

For Lebanon, the double shock of the coronavirus and low oil prices adds to the financial crisis that has plagued the country since the outbreak of last year's mass demonstrations. As early as 2019, the World Bank predicted that the portion of Lebanon's population below the poverty line would increase from 30 to 50 per cent by 2020. The ongoing economic crisis, which led to nationwide protests lasting several months starting in October, has left most of the population with little means to cope with the additional hardships.

It should also be noted that more than 80 per cent of workers in Lebanon have precarious informal and seasonal jobs with salaries close to the poverty line. The Lebanese pound has depreciated by about 50 per cent against the United States dollar and banks have imposed capital controls that have prevented transfers and restricted dollar cash withdrawals.

As a result of this assessment of the Lebanese pound, the prices of basic commodities such as food and medicine have risen dramatically. According to Human Right Watch, the price of a food basket containing basic commodities that should last two weeks for a family increased by more than 25 per cent, from 80,000 Lebanese pounds to 108,000 (70 euros).

The National Emergency Poverty Targeting Programme is the main official response to the crisis, but experts have criticised the programme as inadequate, as it is not reaching those most in need.

Another important point to consider is remittances. Lebanon has a large number of nationals in other countries who generally send money home. As of July 2019, total remittances for that year had reached a peak of $3.5 billion. Generally, remittances are sent through money service companies such as Western Union, or are physically transported. But with no flights arriving from Europe or the Gulf countries, there has been a major disruption in the inflow of remittances.

Traditionally, the arrival of remittances has been an important source of income for countries in crisis. But the cutback in inflows is putting the economy in check, not only for many families, but also for the country. According to figures from Morgan Stanley, Lebanon's GDP is expected to shrink from $55 billion in 2018 to $34.4 billion this year.

At the end of March, the Central Bank of Lebanon issued a statement allowing banks to extend loans to five years without interest, and although the Lebanese Government has extended deadlines for paying taxes and utility bills, it has not taken any action to suspend rent or mortgage payments.

The International Monetary Fund has said that it will make available up to $1 trillion in emergency funds for countries struggling to cope with the economic impact of COVID-19. The World Bank has already approved the reallocation of $40 million from an existing project to increase Lebanon's health system capacity to deal with the virus.

Throughout this health, social and economic crisis, the paramilitary group Hezbollah has become an unexpected protagonist. With Lebanon's public health system overwhelmed, the organization has contributed tens of thousands of doctors and volunteers, as well as ambulances and equipment to fight COVID-19. More than 100 ambulances, several of them with respirators; masks with the logo of the paramilitary organization; more than 25,000 people mobilized, almost 300 doctors, more than 500 nurses, are the numbers that, according to local media, Hezbollah has put at the disposal of the Lebanese people to confront the coronavirus.

Although the organisation seems to be trying to help the country at a time of unprecedented crisis, it should be remembered that its nature is more destructive than creative, generating violence and destabilisation wherever it operates. Its objective, now, would be none other than to gain new followers through the practice of “social aid”, also understood as the organisation of “humanitarian” activities to wash its image.

For its part, the Lebanese government has welcomed any help it can get against the threat of the coronavirus. Fearing that hospitals would be overwhelmed, the administration closed schools at the end of February and also banned flights from infection centres such as China, Iran and Italy on 11 March, before closing the airport completely on 18 March.

The pandemic is likely to exacerbate Lebanon's political instability, fuel conflict between rival political factions and aggravate already high tensions among Lebanese citizens.