Home WorldMiddle-East ‘I can see the despair on their faces’: Lebanon’s economy unravels | Lebanon

‘I can see the despair on their faces’: Lebanon’s economy unravels | Lebanon

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'I can see the despair on their faces': Lebanon's economy unravels | Lebanon

From her wedding dress shop in the impoverished northern Lebanese town of Akkar, Suzanne Hammoud has been selling bridal gowns for more than 15 years. She has revelled in her customers’ excitement as their weddings approached, and often stayed in touch as their lives progressed, sometimes making outfits for their children.

But this year, Hammoud has become more of a buyer than a seller of dresses. Sales racks are full of gowns she has bought back from families who have no other means of income left, except for selling their memories.

“I’m buying their used dresses at cost,” she said. “I can see the despair on their faces, and I don’t have the heart to say no. Even the few brides who are still coming in have hopelessness in their eyes. When they used to come to us, I saw them happy and hopeful.”

On the dusty high street of one of Lebanon’s poorest corners, and across all pockets of a country conditioned to hardship over decades of war and tumult, the effects of a catastrophic economic implosion are straining its social fabric. The resilient Lebanon that somehow always made it through is fast becoming a fable, and ghosts of a recent past are stirring again.

Suzanne Hammoud’s wedding dress store in Akkar, in northern Lebanon, on 14 July. Photograph: Achilleas Zavallis for The Guardian

Since March, prices of most goods have nearly tripled, while the value of the national currency has fallen by 80% and much of the country has ground to a halt. Those who still have work are surviving month to month. Malls are empty. Poverty is soaring, crime is rising, and streets are incendiary.

The country has defaulted on one bond payment and a second is due soon. A fire sale of state assets is being mooted as a fallback. After that, there is little left to trade, except human capital, which is leaving Lebanon en masse.

All the while, the political system blamed for much of the chaos remains at a standstill and reforms demanded of Lebanese leaders by the International Monetary Fund (IMF), in order to unlock aid, are being stonewalled because of the very threat they pose to a system built on patronage networks.

To many who lived through the country’s civil war, it seemed things could never be as bad again. “But they are,” said Ibrahim Haddad, a commando officer in a Christian militia throughout the 15-year conflict, which was declared over in 1990. “The politicians now have learned nothing. They don’t know how to protect the country, or the martyrs. They have not earned respect.”

A mural commenting on the money lost and embezzled by the political system in Lebanon, on an abandoned cinema-theatre in downtown Beirut.
A mural commenting on the money lost and embezzled by the political system in Lebanon, on an abandoned cinema-theatre in downtown Beirut. Photograph: Achilleas Zavallis/The Guardian

Since 2004, Haddad has built and maintained a memorial garden for Christian fighters who died during Lebanon’s worst conflict. On a mountain top owned by the church, he has seeded the state’s emblematic cedar trees across manicured lawns, adorned with iconography and plaques commemorating each military unit. A chapel dug out of a giant rockface stands as a centrepiece.

Dressed in military fatigues, the 63-year-old has devoted nearly every day of the past 16 years to tending the gardens, which appear as a statement of the status of Christians within Lebanon, as much as they are a tribute to their fallen.

Ibrahim Haddad, a Lebanese civil war veteran, in the grounds of the Memorial of Christian Martyrs of the Lebanese Civil War.
Ibrahim Haddad, a Lebanese civil war veteran, in the grounds of the Memorial of Christian Martyrs of the Lebanese Civil War. Photograph: Achilleas Zavallis/Achilleas Zavallis for The Guardian

“This is our Arlington cemetery,” said Naji Khairallah, another veteran of the Lebanese Forces militia. “You won’t see anything like this elsewhere in Lebanon. It means a lot to us.”

In his office, made of stone and iron doors wrought from a ship’s hull, Haddad added: “The Christians of Lebanon are not the Christians of Iraq, or Egypt. We know how to protect ourselves. We know how to fight.”

Graveyards give up their secrets elsewhere in Lebanon too. At the Martyrs Cemetery of Hezbollah, in south Beirut, a man tended to the tomb of his son, Hamad. “He was the first to die in Qusayr [a border town inside neighbouring Syria] in 2013,” he said. Touching the corner of his grave, he added: “He was the only son I had.”

Part of the Memorial of Christian Martyrs of the Lebanese Civil War.
Part of the Memorial of Christian Martyrs of the Lebanese Civil War. Photograph: Achilleas Zavallis/Achilleas Zavallis for The Guardian

Nearby, the two military leaders of the militia turned political bloc, which now holds a whip hand in Lebanese affairs, were buried under cutouts of their likenesses. Casualties from more distant battles with Israel were scattered around the still, silent room.

Outside, the hustle of the new economic reality was being conducted in hushed phone calls in which the latest dollar rate was disclosed like a bookmaking racket. “It’s 9,200 to the dollar now,” said one exchange shop owner, of the dollar rate, which was pegged at 1,500 Lebanese lira before the crisis. “It will be lower tomorrow.”

Cutaways and picture portraits of men who died fighting in Lebanon and Syria at the Martyrs Graveyard in Beirut, a tribute to fallen members of Hezbollah.
Cutaways and picture portraits of men who died fighting in Lebanon and Syria at the Martyrs Graveyard in Beirut, a tribute to fallen members of Hezbollah. Photograph: Achilleas Zavallis/The Guardian

As controls on Lebanon’s financial system continue to weaken, the black market is eclipsing the formal economy. The government has been powerless, or unwilling, to stop the fall of the dollar, and stymie a huge outflow of capital. Prices of food and clothes – almost all imported – are increasing daily, a trend amplified by the transfer of dollars to Syria to try to stabilise a similarly plunging currency.

Up to $21bn (£16bn) has been drained from the country in the past year, financial experts say, by a political and commercial elite who oppose reforms that would replace patronage networks as pillars of political and economic life with merit-based appointments, a reined-in banking system, and a robust private sector.

People queuing for an ATM machine in the town of Akkar, in Lebanon, on 14 July.
People queuing for an ATM machine in the town of Akkar on 14 July. Photograph: Achilleas Zavallis for The Guardian

Alain Bifani, the director general of Lebanon’s finance ministry for 20 years until he quit in June in protest at flatlining negotiations with the IMF over terms of an international bailout, said: “We were very close to having those who benefit so much from the system having to contribute. And this would have undermined the system of power and privilege they had put in place and allowed a modern state to emerge.

“But they got scared and they weren’t strong enough to take this step. They would not touch the happy few. Those who had benefited most wanted to throw the losses on the 5 million Lebanese, by taking over public infrastructure.

“If you want to rebuild a state, you have to rebuild its assets. How do you do that if you dispose of everything?”

In west Beirut’s Hamra street, the director of the National Theatre, Nidal Achkar, is sitting in a room surrounded by framed photos of actors. Power cuts have cast an eerie darkness over the normally bustling boulevard outside. The arc of chaos from the end of the civil war, to the beginning of what many see as an even greater existential crisis, troubles her. She has just reopened for business after closing down for six months.

View of Martyrs’ Square, in Beirut, seen through the window of an abandoned cinema.
View of Martyrs’ Square in Beirut, seen through the window of an abandoned cinema. Photograph: Achilleas Zavallis/The Guardian

“When the war finished, they didn’t sit around a table and ask themselves questions,” she said. “So, all these people started ruling the country again, and nobody stopped them. And this time they started stealing.

“Money, power and religion, they have worked together for hundreds of years. If one falls, the other will pick them up. It’s a world built on sectarianism and family traditions, not ideas that look to the future, but those that tie them to the past.

“This city of Beirut has no hope any more. There is no trust. They have nothing to dream about. What are we going to dream, what are we going to eat, when is the electricity going to come, how much is a kilo of tomatoes?”

Blacked-out buildings in downtown Beirut. State electricity is provided for only a few hours each day and the rest of the time Lebanese people have to buy electricity from private generators.
Blacked-out buildings in downtown Beirut. State electricity is provided for only a few hours each day and the rest of the time Lebanese people have to buy electricity from private generators. Photograph: Achilleas Zavallis/Achilleas Zavallis for The Guardian

How Lebanon got to this point seems less important to many than where it is inexorably heading. Throughout 77 years of nominal independence, the country’s regional political alliances have been even more central to its fate than its internal rivalries. That dynamic has become increasingly potent, with Lebanese officials having lost credibility among key backers, who would had delivered bailout dollars during earlier crises, but are in no mood to do so now.

The 2016 election by MPs of the Maronite Christian and Iran ally Michel Aoun as president, allowing the Iran-backed Hezbollah to join the government – making the group the country’s strongest political presence – soured ties with Saudi Arabia, particularly with the then Lebanese prime minister, Saad Hariri.

Lebanese MP Michel Moawad at his home in Baabda, Lebanon.
The Lebanese MP Michel Moawad at his home in Baabda, Lebanon. Photograph: Achilleas Zavallis/The Guardian

“The causes have added up,” said Michel Moawad, a prominent MP. “It was a big geopolitical position for the country to take to isolate itself and become part of the Iranian axis, while the economy is dollarised and our partners are the Arab world and the west. We lost our main investors and economic partners. The business model of the country was broken.”

When anti-government demonstrations erupted last October, communal and confessional differences that had been often seen as faultlines in Lebanon were subsumed by a soaring patriotism.

Suha Barakat, 26, a protester in central Beirut for the six weeks of demonstrations, said it was the most important time of her life. “I believed,” she said. “And I still want to believe. But I came back to Lebanon from Dubai for this, and now I’m stuck. I hope we’re not just tribal after all.”

Last Saturday, at his palace in the Chouf mountains, Walid Jumblatt, the Druze leader and a civil war figure who remains a lynchpin of the ruling elite, was addressing Druze sheikhs about the crises facing the community and country.

Druze sheikhs during a gathering at the Jumblatt family palace in Moukhtara.
Druze sheikhs during a gathering at the Jumblatt family palace in Moukhtara. Photograph: Achilleas Zavallis/The Guardian

An elderly man rose and asked: “Which period is comparable with the one we are in at the moment? Is this 1957-58[a three-month war], 1975 [the beginning of the civil war] or 7 May [a weeklong clash with Hezbollah]?”

Jumblatt paused, then responded: “We’re at the end of world war one, a time of looming famine and dreadful Spanish flu. We were buying grain from Syria, and locusts were plaguing the land.”

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