Changes to proposed US anti-Hezbollah sanctions allay Lebanon’s fears
BEIRUT: Proposed tighter US sanctions on Hezbollah have been altered enough to allay fears of major damage to Lebanon’s economy, a sign Washington is taking concerns about Lebanese stability seriously, banking and political sources said.
But banking figures told Reuters Lebanese authorities should not be complacent as US President Donald Trump’s future stance on Iran and its allies cannot be predicted, and the bill won’t be discussed and voted on until autumn when Congress reconvenes.
When drafts said to be US plans for extended anti-Hezbollah legislation circulated in Lebanon earlier this year, local media warned of dire consequences for Lebanon’s fragile economy and fractious sectarian politics.
The main concern for Lebanese authorities is that US correspondent banks - which face huge fines if found to be dealing with sanctioned people or companies - might deem Lebanese banks too risky to do business with.
This would undermine the economy, which relies on dollar deposits transferred from expatriate Lebanese. Lebanon’s government, central bank and private banks have lobbied US politicians and banks hard this year - and continue to do so - to persuade Washington to balance its tough anti- Hezbollah stance with the need to preserve stability.
Their main message has been that the last thing needed by the United States, which backs the Lebanese army in its fight against Islamic State and other militants spilling over from Syria, is another failed state in the Middle East.
Their efforts may have worked. The draft law submitted to Congress in late July does not include the main elements that had caused what one banking source called “anxiety” in Beirut.
Financial sources told Reuters the proposed anti-Hezbollah legislation, when compared with earlier draft proposals, is more specific about who could be targeted, and is no longer seen as affecting the whole of Lebanon’s Shi’ite Muslim population.
The powerful Iran- backed, Shi’ite Hezbollah is in Lebanon’s delicate, national unity government but classified as a terrorist group by Washington. US officials say Hezbollah is funded not just by Iran but by networks of Lebanese and international individuals and businesses. — Reuters