Country Report Lebanon January 2011

Outlook for 2011-12: Political stability

The Economist Intelligence Unit's core scenario is that the political scene will remain turbulent in 2011-12, but that, despite serious downside risks, the main parties will manage to avoid a full-scale conflict, although their disputes will continue to be heated. The government led by Saad Hariri, the prime minister, will struggle to make progress on policymaking given the ideological and personal divisions between and within its two major factions. Mr Hariri's "March 14th" movement and its allies are backed by the US, Saudi Arabia and France; the opposition coalition, "March 8th", is backed by Iran and Syria. Relations between the factions are partly influenced by changing relations between these external powerbrokers. The president, Michel Suleiman, who is not aligned with either faction, is a key powerbroker.

Mr Hariri's Future Movement and other parties aligned with March 14th hold only 15 out of the 30 cabinet seats, but a two-thirds majority is required to make decisions of "major national importance". March 8th holds ten seats and, with the support of one more minister, would have the power to block key decisions or even, potentially, to bring the government down. Five cabinet ministers appointed by Mr Suleiman hold the casting votes. The government may make progress on some economic issues but is unlikely to address seriously Lebanon's most divisive political issues or its sectarian power-sharing system, which politicians often sidestep for fear of sparking renewed conflict in a country that experienced civil war in 1975-90. Public expectations of the government are low, not least because of extensive corruption and because many Lebanese believe that the real decisions about their future are taken outside the country.

March 14th is unlikely to have the confidence or power to disarm Hizbullah, a Shia political-military movement that dominates March 8th, whose supporters took to the streets with weapons in May 2008 when March 14th last threatened to curb Hizbullah's autonomy. Since then, however, Walid Jumblatt, the main leader of the minority Druze community and previously one of Mr Hariri's key allies, has reconciled himself with Hizbullah and Syria, which is an indicator of Syria's renewed influence in Lebanon. Mr Hariri has sought to improve his relations with Syria, but some of his supporters have expressed the suspicion that Syria is exploiting these overtures to sow further divisions in March 14th.

Tensions are rising over the UN Special Tribunal for Lebanon (STL), which is due to issue indictments-possibly against Hizbullah members and perhaps in early 2011-in relation to the 2005 assassination of Mr Hariri's father, Rafiq, a former prime minister. The expectation of indictments against Hizbullah members has increased political tensions substantially. For its part, the Shia party will continue doing everything it can to undermine the STL and advance its argument that Israel was responsible for killing Mr Hariri, and potentially also for forging telecommunications data that may seem to implicate Hizbullah. Even if Lebanon manages to steer away from the brink of renewed sectarian conflict, through regional mediation, sporadic smaller-scale armed exchanges between factions are likely in Beirut (the capital), Sidon and Tripoli.

© 2011 The Economist lntelligence Unit Ltd. All rights reserved
Whilst every effort has been taken to verify the accuracy of this information, The Economist lntelligence Unit Ltd. cannot accept any responsibility or liability for reliance by any person on this information
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