The Impact of Border Clashes on Lebanon's Displaced Population and Financial Markets
By Jehad Shalbak Amr Alfiky
YOHMOR/TYRE, Lebanon (Multibagger) - Displaced in south Lebanon five times, Kamel Mroue and his wife Mariam are anxious about their next move as they follow the news of clashes between Israel and Hezbollah, fearing border hostilities will turn into all-out war.
The parents of three children, who live abroad, have been back and forth between their village of Yohmor, just kilometers away from the frontier, and friends elsewhere around Lebanon.
“The future is dim,” said Mroue, an academic.
The conflict has displaced more than 100,000 people in southern Lebanon, according to the International Organization for Migration’s Displacement Tracking Matrix.
Israel and the powerful Iran-backed Hezbollah have been trading fire since the Palestinian militant group Hamas attacked Israel on Oct. 7 and ignited the war in Gaza, which shows no signs of easing.
Now in its tenth month, the conflict has spread to Lebanon where Israel has inflicted devastation in previous conflicts with Hezbollah.
PAST DEVASTATION
The 2006 war between Israel and Hezbollah killed 1,200 people in Lebanon, mostly civilians, and 157 Israelis, mostly soldiers. Israeli bombardment pounded Hezbollah-controlled south Lebanon and destroyed wide areas of its stronghold in the southern suburbs of Beirut.
Most of the fighting over the last 10 months has erupted on the border between Israel and Lebanon. Israel has ratcheted up tensions with assassinations of senior Hezbollah figures.
Hezbollah's response to Israeli attacks will be strong and effective, Sayyed Hassan Nasrallah, the leader of the powerful Lebanese militant group, said earlier this month.
He was speaking in an address marking the one-week memorial of the group's top military commander Fuad Shukr, who was killed in an Israeli strike in Beirut's southern suburbs.
Iran and Hezbollah have also threatened to avenge the assassination of Hamas leader Ismail Haniyeh in Tehran last month, widely blamed on Israel. Israel has not claimed responsibility for the attack.
Lebanon's state, hollowed out by a five-year economic crisis left to fester by ruling elites, had struggled to provide basic services even before the current conflict began. The economic crisis and border conflict have taken a heavy toll.
“It all affects you - your psychological state is affected to the point that I have started taking medicine to calm my nerves,” said Mariam.
While Israel houses its displaced in government-funded accommodation, Lebanon relies on ill-equipped public schools or informal arrangements, such as staying with family or friends.
Wafaa Youssef Al-Darwish sought refuge with family. Originally from the village of Dhraya near the Israeli border, she fled to stay with her sister in Tyre, a southern city that has itself been targeted by air strikes during the conflict.
“We were at our village, working normally and a war was imposed on us,” said Darwish, who used to work in agriculture, producing and selling cans of olive oil. The war deprived Lebanese of homes, neighborhoods, and sustenance, she explained.
“It's a great tragedy."
Analysis:
The ongoing border clashes between Israel and Hezbollah in Lebanon have led to the displacement of over 100,000 people, causing significant social and economic disruptions. The conflict, which has escalated over the past ten months, has historical roots in previous wars that have devastated the region. The current situation has heightened tensions and raised concerns about the potential for all-out war.
For investors, these geopolitical tensions can have a direct impact on financial markets, particularly in the Middle East. The uncertainty and instability created by the conflict can lead to fluctuations in stock prices, currency values, and overall market sentiment. Additionally, the humanitarian crisis resulting from the displacement of thousands of people adds another layer of complexity to the situation.
As a result, it is crucial for investors to stay informed about the developments in the region and assess the potential risks to their portfolios. By understanding the broader implications of the conflict on both a human and financial level, individuals can make more informed decisions about their investments and navigate the volatile market conditions with greater confidence.