ANSD : Sanctions unlikely to affect Hezbollah

SAT 20 - 4 - 2024

Date: Aug 14, 2018
Source: The Daily Star

Sanctions unlikely to affect Hezbollah

_{Joseph Haboush| The Daily Star}
BEIRUT: The recent reimposition of United States sanctions on Iran are taking a toll on the country’s economy, but analysts say there will be little impact in the near future on its proxy Hezbollah. Not only has Hezbollah grown into creating its own sources of revenue, but the group’s role in the region is declining as the neighboring war in Syria winds down.

“Because of Syria[’s war] being almost done, the financial burden on Hezbollah has been significantly reduced,” Hilal Khashan, chair of the political studies department at the American University of Beirut, told The Daily Star.

However, families of Hezbollah fighters who have been killed, whose number now hovers at around 5,000, receive a monthly stipend from the party. The financial load will continue to grow as long as Hezbollah has fighters present in conflicts across the region.

The group’s ability to keep up with the stipends “was questioned after the 2006 War with Israel and it is repeatedly discussed, but they get plenty of local funding,” Khashan added.

With the group depending on cash – outside of the banking system – many supporters continue to donate a share of their earnings.

“Shiite businesspeople pay 20 percent of their yearly earnings to their political establishment and religious leaders,” Khashan said.

Khashan cited Hezbollah’s overseas projects in areas like Latin America and West Africa as other sources of funding. “Over the years, [the group] has learned how to generate its own funds ... and to some degree become self-sufficient. ... It’s impossible to stop Hezbollah’s finances.”

Whatever the effects may be, Khashan doesn’t think Iran and its proxy will have much to worry about in the near future: “They’ve both learned how to deal with adversity.”

Joe Macaron, a fellow at the Arab Center in Washington, D.C., said that Iran can continue to transfer money to Hezbollah, including via unofficial trade routes with Iraq across Syria to Lebanon. “The U.S. is targeting the official economy in Iran, while Hezbollah benefits from transactions outside the official economies of both Lebanon and Iran,” he told The Daily Star.

Iran might also not decrease its funding to Hezbollah “because relative to its economy, Hezbollah is cheap,” former U.S. State Department official Jarrett Blanc said.

Iran holds $100 billion in financial assets, according to Khashan.

“Iran doesn’t need a lot of economic growth in order to pay bills for Hezbollah and [Syrian President] Bashar Assad,” Blanc added.

According to Blanc, Iran was paying these bills consistently, even during the period of the most aggressive U.S. sanctions. Khashan echoed this point, saying: “Iran’s economic problems with sanctions has been ongoing for more than 30 years since the [1979] revolution.”

In addition to the financial impact, Macaron noted that the political influence of the sanctions against Iran means very little for Hezbollah. “Delaying the Lebanese government formation seems like an attempt to drain Iranian leverage in Lebanon and is part of a larger effort to scale down Iranian regional behavior,” Macaron said, referring to the ongoing stalemate in forming a new Cabinet after Lebanon’s parliamentary elections in May.

Along the side of domestic bickering over shares in the new government, analysts have mentioned that external interference has been also delaying its formation.

Macaron highlighted that Iran’s response to pressure from Washington will affect Hezbollah’s calculations in the long run. “However, these U.S. efforts as they stand today are far away from reigning in Hezbollah’s arms,” he said. “The Trump administration is going after Hezbollah’s source of support, and if the Shiite group felt the Iranian regime’s survival is in question, it might act to increase the cost of U.S. diplomatic pressure on Iran.”

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