23 October 2020

What does the reinstatement of PM Saad Hariri mean for Lebanon?

The reinstatement of Saad Hariri as Prime Minister brings some hope for political stability as the country continues to grapple with an intense economic and social crisis.

By Indi Phillips

On 22 October 2020 former Prime Minister (PM) Saad Hariri was reinstated almost one year to the day since his ousting amidst anti-government protests in 2019.

Since October 2019, Lebanon has been in freefall. The initial cracks began to show in a remarkably fast slip into hyperinflation with the Lebanese Lira (LL) crashing from 1,500LL to the US dollar to 10,000LL in June 2020, settling at 7,100LL to the dollar as of 22 October. This process, dubbed as ‘Lirafication’ by locals, has led to a squeeze on imports, resulting in the tripling of prices on basic goods and casting even middle class earners into poverty.

COVID-19 further sunk any income through tourism and pushed a struggling hospitality industry to the brink of collapse. Aside from this, with COVID-19 continuing to place pressure on hospitals and medical facilities nationwide, Lirafitation meant that doctors’ bills and the price of medicine skyrocketed.

Throughout this period, PM Hassan Diab, who took the place of Saad Hariri following the 2019 uprisings, remained conspicuous only in his absence, with the Lebanese people seeing little to no governmental support whilst the currency collapsed and 20-hour power cuts became the norm from May through the end of July.

Then, on August 4, the Beirut Blast, the third biggest non-nuclear explosion in history, occurred. The blast killed some 200 people and injured many thousands, destroying Beirut’s Downtown and nightlife hubs and casting the country into a further state of economic, political and social collapse. The LL dropped further against the dollar and Hassan Diab resigned along with the rest of the government, one week after the blast. Caretaker PM Mustapha Adib remained in power 24 days before resigning himself after he wasunable to bring about cabinet formation with Shia parties Hezbollah and Amal, who insisted on taking on the finance and health ministries in the post-blast cabinet, which would exclude Lebanon from any international support, given Hezbollah’s classification as a terrorist organisation by many EU states.

France’s Emanuel Macron, the first dignitary, foreign or domestic, to set foot on the streets of decimated Beirut following the blast, became something of a symbol of transparency and functionality, offering the Lebanese government access to the major Cedre fund, should economic, energy and transparency reforms be implemented.

These reforms are vital for the survival of the state and its people as the Central Bank runs perilously low on reserves, warning it will be forced to lift subsidies on fuel, medicines and wheat from November, triggering a further escalation in the health crisis, massive fuel shortages and possible starvation.

In relation to this, the reinstatement of Saad Hariri provides a glimmer of hope to a country on the brink of economic collapse. He is an individual perceived as the only politician capable of implementing reforms in a highly fractious cabinet made up of parties who have been in tenuous allegiance and fixed disputes for some 40 years.

Although Hariri is in many ways responsible for the demise of the country due to his corrupt leadership until 2019, his ability to push parties towards necessary reform is what has led to his reinstatement. For the moment, reforms and the righting of a speedily disintegrating economy take precedence.

Indi Phillips is a Lebanon-based political and security risk analyst covering Sub-Saharan Africa and the Middle East.