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Israel-Hezbollah clashes deepen Lebanese crisis as war fears mount

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Recent weeks have seen an escalation of tensions along the Lebanon-Israel border, with clashes intensifying between the Lebanese militant group Hezbollah and Israeli forces. The situation, already fragile, has been exacerbated by retaliatory attacks and targeted assassinations, deepening concerns of a full-blown war and heightening fears of further destabilization in the region.

Israel’s tightrope between diplomacy and defense

Analysts suggest that Israel is pursuing a dual strategy in its dealings with Hezbollah: politically advocating for compromise while demonstrating determination through military actions.

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“Israel’s objective is to secure its northern borders and facilitate the return of internally displaced Israelis, showcasing political capability,” Ziad Majed, political scientist and professor of Middle East studies at the American University of Paris, told Al Arabiya English. “It also seeks to push Hezbollah to the north of the Litani River by bombing the party’s positions and dozens of Lebanese villages and towns.”

Diplomatically, Majed added, Israel is conveying its conditions through intermediaries, aiming to avoid full-scale conflict but signaling readiness for escalation if other channels fail.

Deadly tit-for-tat confrontations

The deadly confrontations over the past few months have signaled a perilous tit-for-tat exchange with no resolution in sight. Israel has lately stepped up its air campaign, bombing deeper into Lebanon, while Hezbollah has used some of its extensive arsenal of rockets and missiles.

Smoke rises above Kfar Yuval following a rocket strike that, according to Israel's ambulance service, was fatal, near Israel's Lebanese border in northern Israel, January 14, 2024. (Reuters)
Smoke rises above Kfar Yuval following a rocket strike that, according to Israel's ambulance service, was fatal, near Israel's Lebanese border in northern Israel, January 14, 2024. (Reuters)

On Monday, Israeli airstrikes targeted Lebanon’s Bekaa Valley, killing at least two Hezbollah members, marking the most significant assault on Lebanese soil since tensions flared with the Iran-backed group last October. It was the first instance of Israel striking eastern Lebanon following the outbreak of the war in Gaza.

In response, Hezbollah launched a barrage of 60 Katyusha rockets toward an Israeli army base in the occupied Golan Heights.

Last week, Israeli jets struck two warehouses in Ghazieh, southern Lebanon, near the city of Sidon, almost 30 kilometers from the nearest Israeli boundary. The attacks wounded 14 people, according to state media. The Israeli army claimed to have targeted “Hezbollah weapons storage facilities” in response to an apparent suicide drone that crashed and exploded earlier in the day near the Tiberias area.

Israel, Hezbollah exchanging fire almost daily

Hezbollah and Israel’s military have exchanged fire almost daily since the start of the war in Gaza after the October 7 Hamas attack on Israeli communities and military bases in southern Israel, which left 1,200 Israelis dead with another 240 taken hostage.

Hezbollah has said its campaign aims to offer “support to the Palestinian people and the resistance in Gaza.”

Since the hostilities began, Israeli strikes in Lebanon have killed around 200 Hezbollah fighters and 35 civilians. In Israel, nine soldiers and nine civilians have been killed in Hezbollah attacks.

Smoke billows following an Israeli air raid that targeted an area between the Lebanese border villages of Ramia and Marwahin on February 21, 2024. (AFP)
Smoke billows following an Israeli air raid that targeted an area between the Lebanese border villages of Ramia and Marwahin on February 21, 2024. (AFP)

Tens of thousands of people on both sides of the Israel-Lebanon border have been uprooted and displaced.

Despite international diplomatic efforts, the situation remains volatile, with the potential for the conflict to spiral out of control and the looming risk of regional spillover from the Gaza war.

Over recent months, the US has engaged in negotiations between Lebanon and Israel, aiming to mitigate the risk of higher conflict. Amos Hochstein, a US envoy and senior energy advisor who played a key role in brokering the maritime border agreement between Lebanon and Israel in October 2022, continues to pursue diplomatic avenues to find a resolution.

Discussions, though, have been intricately nuanced due to the US policy of not directly communicating with Hezbollah in Lebanon. The group, widely recognized as the most influential military entity in the country, is designated as a terrorist organization by the US.

On Thursday, CNN published a report citing concerns among US officials regarding Israel’s potential initiation of a ground invasion into Lebanon in the late spring or early summer if diplomatic endeavors do not succeed in compelling Hezbollah to retreat from the northern border with Israel.

“While a final Israeli decision has yet to be made, the worry is acute enough inside the Biden administration that the prospect of an incursion has made its way into intelligence briefings for senior administration officials,” the report read.

The pressure on Israeli Prime Minister Benjamin Netanyahu is high as many believe he will be forced to relinquish his post once the war against Hamas in Gaza ends.

“If Gaza tensions ease and Israeli public opinion increasingly perceives conflict in the north as untenable, Netanyahu’s government may face pressure to act decisively,” Majed noted.

Hezbollah’s preparedness and strategic calculus

On the Lebanese front, Hezbollah has repeatedly stated its resilience in the face of threats, asserting readiness for any scenario.

Smoke rises following what the Israeli armed forces say was an airstrike on Hezbollah targets at a location given as Lebanon, in this screen grab obtained from a video released on January 8, 2024. (Reuters)
Smoke rises following what the Israeli armed forces say was an airstrike on Hezbollah targets at a location given as Lebanon, in this screen grab obtained from a video released on January 8, 2024. (Reuters)

“While Iran and Hezbollah prefer to avoid an all-out war, Hezbollah faces a credibility dilemma at home,” Majed said. “Despite its rhetoric of maintaining a balance of power with Israel, the current events challenge this narrative. Hezbollah’s approach to the conflict involves a calculated strategy of low-to-moderate intensity warfare with Israel, influenced by internal considerations coupled with regional dynamics.”

He added: “Hezbollah’s response to Israeli provocations is nuanced. While the group demonstrates military preparedness by occasionally displaying new weaponry to deter Israeli aggression, its actions aim to signal resolve rather than provoke escalation.”

However, Hezbollah may resort to using greater force if Israel persists with its airstrikes, according to Majed.

“Should Israeli strikes penetrate deeper into Lebanese territory, Hezbollah could escalate its targeting to include more strategic locations within Israel,” he explained.

Hezbollah leader Hassan Nasrallah said in a speech last month that the group would adhere to a ceasefire in southern Lebanon if one were to be reached in Gaza. Nonetheless, he made it clear that Hezbollah would resume its attacks if Israel continued strikes in Lebanon following any agreement with Hamas.

Last Sunday, Israeli Defense Minister Yoav Gallant indicated that Israel planned to increase attacks on Hezbollah in the event of a possible ceasefire in the Gaza conflict.

“If a temporary pause is reached in Gaza, we will increase the fire in the north separately and will continue until the full withdrawal of Hezbollah [from the border] and the return of Israeli citizens to their homes,” he said in a statement on X.

Despite these tensions, Majed believes that both Hezbollah and Israel remain cautiously optimistic about the potential for diplomatic interventions to defuse the situation.

Lebanon’s economic fallout

Experts warn that a wider war in Lebanon would be catastrophic. The country’s already fragile economy, battered by years of political turmoil, corruption, and lack of reforms, is now grappling with the impact of the ongoing skirmishes between Israeli forces and Hezbollah. With attacks hitting areas along the border, economic activity in these regions has been severely disrupted.

According to The Policy Initiative, a Beirut-based independent think-tank, vital sectors such as tourism and agriculture, particularly in southern Lebanon, bear the brunt of the continued fighting. Meanwhile, the illegal use of phosphorus in Israeli attacks not only ravages the land but also jeopardizes future agricultural productivity, rendering vast areas unusable for farming due to its long-lasting effects.

The investment sector is also facing a notable decline, with October 2023 seeing a 60 percent drop in nationwide real estate transactions compared to the 12-year average. This hesitancy suggests a potential $105 million loss in foreign direct investment (FDI) over six months, totaling about $550 million in lost inflows for Lebanon.

“The crux of Lebanon’s economic vulnerability lies in its heavy reliance on external inflows, comprising tourism, remittances, investments, and exports, which collectively constitute a staggering 90 percent of the economy,” Sami Zoughaib, an economist and research manager at The Policy Initiative, told Al Arabiya English. “These inflows are sensitive to conflict and instability, rendering them exceptionally vulnerable during periods of war. The ongoing conflict has already exacted a toll, evident in the 23 percent reduction in inbound passengers and significant downturns in real estate transactions.”

Lebanon’s inherent vulnerabilities stemming from its cash-based economy exacerbate the economic fallout in the event of war-induced disruptions to ports and the airport, hindering the flow of capital, Zoughaib added.

A woman counts US dollar banknotes as Lebanese pounds are pictured in the background at a currency exchange shop in Beirut, Lebanon. (Reuters)
A woman counts US dollar banknotes as Lebanese pounds are pictured in the background at a currency exchange shop in Beirut, Lebanon. (Reuters)

The country is grappling with an economic crisis, ranked by the World Bank as one of the worst in modern history. Decades of corruption and mismanagement have forced it deep into an abyss of financial despair.

It has yet to implement critical structural and financial reforms necessary to unlock billions in aid from the International Monetary Fund and other international donors. Political discord is preventing the consensus needed to enact these reforms.

Lebanon has been without a president since the term of former head of state Michel Aoun ended in October 2022. It has a caretaker cabinet led by Prime Minister Najib Mikati, but with limited powers.

The tiny Mediterranean country has weathered numerous crises in its history, including a decade-and-a-half-long civil war and the 2006 conflict between Israel and Hezbollah. However, the scenario today paints a starkly different picture.

“In 2006, Lebanon boasted considerable financial resources and operational banks, along with fiscal capacity, enabling public expenditure. Our relations with neighboring countries were positive. This is not the case today,” Zoughaib noted.

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