Amid ongoing political paralysis, Central Bank took measure prompting currency devaluation, and France sought to mediate Beirut’s diplomatic spat with Saudi Arabia. Cabinet meetings still on hold with little apparent prospect of resolution. Attempts to reach political deal ended in acrimony: PM Mikati and Parliament Speaker Nabih Berri met 20 Dec, but did not succeed in resolving disputed issues – including Hizbollah and its allies demanding removal of Judge Tarik Bitar from investigation into Aug 2020 Beirut port explosion, Free Patriotic Movement party asking modifications to mode of expatriate voting, and issue of reshuffling senior security positions. On economic front, currency fell to record low. Following 3 Dec resignation of Information Minister George Kordahi, whose comments on Saudi-led war in Yemen had caused frictions with Gulf countries, Lebanese lira improved by nearly 10% within less than 24 hours, reaching 22,000 to U.S. dollar. However, in unexpected move Central Bank 9 Dec raised amount of lira that depositors can receive for U.S. dollars from 3,900 to 8,000, triggering fears of inflation that sent lira to record lows at 29,000 to U.S. dollar on 14 Dec; currency stabilised at 27,000 after Central Bank same day announced injection of additional dollars into market. Shooting 12 Dec erupted at funeral procession in Palestinian camp Burj al-Shemali in Tyre city killing three Hamas members; Hamas blamed factions affiliated with Palestinian Authority (PA) while PA rejected allegations. During visit to Qatar, United Arab Emirates and Saudi Arabia, French President Macron 3-4 Dec sought to restore relations between Riyadh and Beirut; Macron’s attempt to arrange meeting reportedly failed but PM Mikati and Saudi Crown Prince Mohammed bin Salman 4 Dec held telephone call during which they struck agreement on unspecified mechanism for humanitarian cooperation. After Shiite Bahraini opposition group Al-Wefaq 11 Dec held press conference in capital Beirut criticising Bahrain’s human rights record, Minister of Interior Bassam Al-Mawlawi 15 Dec ordered deportation of non-Lebanese members of Al-Wefaq in likely attempt to curry favour with Gulf Cooperation Council. UN Sec-Gen Antonio Guterres 19-21 Dec visited Lebanon on “mission of solidarity”, met religious, civil society and political leaders.

Standoff over investigation into Aug 2020 Beirut port explosion continued, while economic decline triggered protests across country. Shiite groups Hizbollah and Amal maintained demand to remove investigative judge Tarik Bitar. Cabinet meetings remained suspended since 12 Oct due to political divisions; attempt by Maronite patriarch to mediate compromise solution to standoff failed to achieve breakthrough and judiciary faced increasing paralysis while facing political pressure amid flurry of procedural objections and counter-suits by some of politicians Bitar seeks to question. Work on measures to alleviate worst symptoms of economic crisis, in particular to increase electricity supplies and release rationing card to support poorest citizens hit by removal of subsidies, continued throughout month but without significant breakthroughs. Govt also continued consultations with International Monetary Fund on financial assistance. Protesters 26 Nov broke into ministry of social affairs building in capital Beirut citing further economic decline and continuing currency collapse. Protesters 29 Nov constructed roadblocks in central Beirut, northern city Tripoli and southern city Sidon, calling on govt to act to address collapsing currency. UNICEF 23 Nov reported “dramatic deterioration of living conditions” as over 50% of families had at least one child who skipped meal by Oct 2021. After diplomatic spat late Oct erupted with Gulf states after footage emerged of Information Minister George Kordahi criticising Saudi-led war in Yemen, relations with Gulf continued to face strains and deepened govt paralysis. Affair worsened 2 Nov when leaked statements of FM Abdallah Bouhabib (appointee of President Aoun) revealed minister criticising Saudi positions. After Riyadh declared ban on all commercial transactions with Lebanon, govt faced prospect of obliterating export earnings from Saudi Arabia, which already fell from $250mn in 2020 to $100mn this year, thus increasing economic and financial hardship at home; Aoun 29 Nov expressed desire for reconciliation with Riyadh.

Investigation into Aug 2020 Beirut port explosion sparked divisions within govt and deadly sectarian clashes in capital Beirut. Investigative Judge Tareq Bitar 12 Oct issued arrest warrant for former Minister of Finance Ali Hassan Khalil, close aide to head of Shiite party Amal and Speaker of Parliament Nabih Berri, for failing to appear for questioning over Aug 2020 Beirut port explosion; Hizbollah Sec Gen Hassan Nasrallah previous day accused Bitar of “biased” and “politicised” investigation and demanded judge be replaced; Lebanese courts repeatedly turned down legal challenges by Khalil and other politicians against Bitar. Political row over investigation into port explosion forestalled cabinet meetings and govt work from 13 Oct, as Shiite ministers reportedly threatened walk-out if Bitar not removed. Dispute also triggered lethal fighting in capital Beirut. Hizbollah and Amal 14 Oct mobilised protest in front of Palace of Justice, located in Christian neighbourhood adjacent to Shia-populated areas; gunfire and three-hour-long street battle ensued, killing seven Shiite Muslims, in troubling reminder of sectarian clashes during civil war (1975-1990). Hizbollah leader Hassan Nasrallah 18 Oct accused Christian party Lebanese Forces of staging ambush, while Lebanese Forces blamed violent protesters; Nasrallah called for official investigation and warned: “We won’t leave the blood of our martyrs on the ground”. Meanwhile, power supplies across country marginally improved by mid-month as Central Bank further depleted currency reserves, while roll out of rationing card faced bureaucratic complications. Following collapse of talks in June 2020, govt 19 Oct resumed negotiations with International Monetary Fund on financial assistance. U.S. 14 Oct voiced support for plan to deliver gas and electricity to Lebanon via Syria and also pledged additional $67 mn for Lebanese Armed Forces. Parliament 19 Oct voted to bring elections, initially scheduled for 8 May 2022, forward to 27 March. Diplomatic spat late month erupted with Gulf states after footage emerged of Information Minister George Kordahi criticising Saudi-led war in Yemen; in move that could damage govt credibility and compound domestic crises, Riyadh, Kuwait, Bahrain and United Arab Emirates expelled Lebanese ambassador and recalled their ambassadors from Beirut, while Riyadh banned all Lebanese imports.

Parliament approved formation of new govt led by Najib Mikati, ending 13-month period with caretaker authorities. Lebanese leaders 10 Sept agreed on formation of new govt under leadership of PM-designate and billionaire Najib Mikati; appointment ended extended stalemate that had left country without empowered govt since resignation of PM Hassan Diab on 10 Aug 2020 in wake of catastrophic Beirut port explosion. Parliament 20 Sept passed vote of confidence in new govt, with support of 85 out of 117 sitting members of parliament. Following dramatic deterioration in fuel crisis last month, long queues at gas stations and shortages of goods continued throughout month. Hizbollah during month realised its previous commitment to import fuel directly from Iran, in direct violation of U.S. sanctions; first deliveries of fuel reached country 16 Sept, after transiting Syria and crossing border without official knowledge or involvement of Lebanese authorities. Hizbollah-linked and U.S.-sanctioned Amana company distributed diesel fuel for electricity generation to public sector institutions and bakeries across country for free, while charging consumers about 25% below govt-mandated price ceiling. State electricity company 23 Sept said country risked total blackout by end of month as its fuel reserves dwindle. Some 300 protesters in capital Beirut 29 Sept protested govt’s decision two days earlier to suspend enquiry into port explosion. In highest-level contact in decade, govt delegation 3 Sept met Syrian officials in Syrian capital Damascus to discuss importing natural gas for power generation from Egypt through Jordanian and Syrian pipeline network. Israel’s 18 Sept decision to award offshore drilling contract to U.S. corporation Halliburton prompted PM Mikati and FM Abdallah Bou Habib to reiterate Lebanon’s claims over disputed maritime border with Israel; President Michel Aoun so far has refrained from signing amendment that would expand country’s claims to Exclusive Economic Zone by 1430 sq km, potentially affecting Israeli-claimed Karish gas field.

Central Bank’s cut of subsidies dramatically worsened fuel crisis and sparked unrest; Hizbollah and Israel exchanged fire. On economic front, worsening fuel crisis led to drastic shortages. Central Bank governor Riyadh Salameh 11 Aug halted provision of heavily subsidised exchange rates to energy importers, citing foreign currency reserves reaching lowest legal limit; decision would have forced importers to impose five-fold increase on prices for gasoline, but ministry of energy refrained from adjusting tariffs, leading to severe supply and distribution disruption. Resulting shortages caused generator operators to cut further service hours, hospitals to issue warnings about inability to care for intensive-care patients and kilometres-long queues at gas stations, where gunfire caused several casualties during month. Notably, security forces 14 Aug raided fuel storage to prevent hoarding or smuggling of fuel to Syria, causing gas explosion that killed more than 30 civilians and soldiers and injured dozens more. In response, President Aoun, govt and Central Bank 21 Aug agreed to extend fuel subsidies until end Sept at lower level, limiting price increases. Reports late month indicated violent incidents related to shortages of gas and other goods continued, including in Maghdouche and Anqoun southern towns. Meanwhile, PM-designate Najib Mikati 5 Aug reported gradual progress toward formation of new cabinet and called meeting same day with Aoun “positive step forward”; Mikati and Aoun during month engaged in frequent direct negotiations on govt composition. By end of month, however, no breakthrough had been reached. Unclaimed rockets fired from southern Lebanon 4 Aug struck Israeli border town Kiryat Shimona; Israeli air force next day retaliated with air strikes in first such attacks inside Lebanon since 2013/2014. In response, Hizbollah 6 Aug launched 19 rockets at uninhabited areas of disputed Shebaa farms area, triggering Israeli mortar response. In incident underscoring lingering sectarian tensions, brother of teenager killed in Sept 2020 clashes near capital Beirut between Hizbollah and Sunni Arabs 31 July shot dead alleged Hizbollah-linked perpetrator in southern town of Jiyeh; relatives of teenager 1 Aug ambushed attendees at alleged perpetrator’s funeral, clashes left another five dead before army deployed to end confrontation.

Parliament appointed businessman Najib Mikati as PM-designate after Saad Hariri’s resignation, unrest erupted amid plunging currency value and rising prices, and EU established sanctions framework. Govt formation efforts faced major setback as PM-designate Saad Hariri 14 July visited President Aoun to submit new cabinet line-up, requesting response within 24 hours; Aoun reportedly rejected proposed cabinet despite appeals from French and U.S. ambassadors. Hariri next day relinquished mandate to form new govt that he received in Oct 2020, citing irreconcilable differences with Aoun. Parliament 26 July appointed Tripoli-based businessman Najib Mikati as new PM-designate; while expected to form reform-oriented govt, Mikati thus far lacks support of Christian parties. Mikati 28 July said Aoun had approved most of his nominees for new govt. Economic hardship and insecurity persisted. Following Hariri’s resignation, Lebanese pound 16 July fell to record lows, reaching nearly 24,000 to U.S. dollar before stabilising at 22,000. Ministry of health same day ended subsidies for broad range of medications, leading to fivefold price increase, after delayed subsidy payments already caused medication shortages in pharmacies. Drop in currency value and medicine price hikes 16 July triggered protests in northern city Tripoli, leading to clashes with army that left 30 civilians and ten soldiers injured. Army chief Joseph Aoun next day warned against further deterioration of security and vowed to maintain stability, stating “everybody knows that the army is the last institution that is still effective”. Gas shortages 19 July worsened as consumers sought to stockpile for Eid al-Adha holidays, while electricity provisions reached record low of 2-3 hours daily. Meanwhile, EU 30 July adopted legal framework providing options to sanction persons and entities “responsible for undermining democracy or the rule of law in Lebanon”, urged leadership to “steer the country towards a sustainable recovery”; French MFA same day announced French-hosted international donor conference to aid country on one-year anniversary of Beirut port explosion on 4 August. Two rockets were launched 19 July from Lebanon toward Israel without causing damage; in response, Israel next day shelled launching areas and blamed Palestinian groups for attack.

Political infighting continued to stall govt formation while Lebanese pound fell to record low amid worsening economic crisis. Amid ongoing stalemate over govt formation, President Aoun 2 June released statement criticising PM-designate Saad Hariri’s “continuous evading of responsibilities” that “constitutes a persistent violation of the constitution and national accord”; Hariri same day hit back stating presidency is held “hostage to the personal ambitions” of Jibran Bassil, Aoun’s son-in-law and leader of Christian group Free Patriotic Movement. Economic crisis and living conditions continued to deteriorate. Protesters 2 June blocked main roads in capital Beirut to protest economic situation after court previous day suspended Central Bank decree that allowed withdrawal at better rate than fixed exchange rate; suspension reversed next day. Lebanese pound 13 June hit low of 15,300 to dollar on black market, marking lowest rate since March. Workers 17 June held general strike to protest economic situation and political stalemate, accompanied by roadblocks in Beirut and other cities; Energy Minister Raymond Ghajar same day stated petrol subsidy is poised to end. Ministry of economy and trade 18 June raised price of subsidised bread for fifth time in one year. Lebanese pound 26 June dropped further to 18,000 to dollar, prompting new roadblocks and minor riots in Tripoli and Sidon cities as well as other locations. Energy ministry 29 June raised fuel prices. Meanwhile, international stakeholders maintained pressure. France 17 June convened virtual donor conference over concerns about pressure of economic crisis on Lebanese Armed Forces, with French defence ministry calling for “increased commitment and coordination from everyone”. EU foreign policy chief Josep Borrell 19 June berated govt stalemate as putting country on edge of “financial collapse”, warning EU response could include targeted sanctions; Borrell next day pinned “strong mistrust” as root of crisis.

Political deadlock over govt formation continued amid ongoing economic and social strife; protesters rallied and groups fired rockets at border with Israel in support of Palestinians. French FM Jean-Yves Le Drian 6 May visited Lebanon in another attempt to break stalemate between PM-designate Saad Hariri and President Aoun in forming new govt; Le Drian next day announced sanctions on politicians blocking process. In letter to parliament speaker, Aoun 18 May blamed Hariri for delay and demanded plenary debate, widely seen as call on parliament to rescind Hariri’s PM nomination despite no constitutional provision providing for PM destitution. Hariri 22 May said he would “not form a government as the team of the president wants it, or any other political faction”. Former PMs Fouad Siniora, Najib Mikati and Tammam Salam, widely seen as influential political voices in Sunni community, 19 May condemned Aoun’s initiative as “attack on coexistence”. Economic and social hardship continued. Caretaker PM Hassan Diab 3 May said proposed ration card program aimed at replacing costly subsidies scheme and offering safety net to most vulnerable citizens faced political pushback. Petrol stations 10 May began closing amid continued fuel shortages and rationing, causing hours-long queues by 11 May; dispute over fuel allocation 17 May left one dead in north. World Bank 31 May warned that country’s economic and financial crises could amount to one of “most severe crises episodes globally since the mid-nineteenth century”. In response to deadly fighting between Israel and Gaza-based Palestinian armed factions (see Israel-Palestine), pro-Palestinian protesters 14 May attempted to cross border near Israeli town of Metula, prompting Israeli fire that killed one Hizbollah and injured two protesters; protests 17 May continued at border. Suspected Palestinian groups 18 May fired six rockets from south toward Israel that fell short of crossing border. Altercations broke out in-lead up to 26 May Syrian presidential elections (see Syria); notably, activists of Christian Lebanese Forces party attacked Syrian voters in and around capital Beirut, claiming voting indicated support for Assad regime.

Govt warned of further funding cuts as fighting over dwindling subsidised goods in northern city Tripoli turned deadly; France considered new approach to break deadlock over govt formation. Economic situation remained critical. Finance Minister Ghazi Wazni 2 April said funding for basic imports would run out by end of May, indicating rationing and overhaul of blanket subsidy scheme costing $500 mn per month. In northern city Tripoli, fighting over dwindling subsidised goods, which has become commonplace, 14 April killed one and injured two in further sign of deteriorating economic situation and rising social tensions. Hizbollah 16 April moved to create own subsidy system, issuing ration cards for food and importing medicine and fuel of primarily Iranian and Syrian origin. Political stalemate over govt formation continued. Over 100 high-profile economists and political scientists 3 April co-signed op-ed urging French President Macron to freeze assets of Lebanese politicians held in France. In sign of possible new Paris approach to break stalemate, which may include punitive measures, French FM Jean-Yves Le Drian 6 April signalled travel bans and asset freezes on Lebanese politicians under consideration to foster agreement on govt formation. PM-designate Saad Hariri 14 April visited Russian capital Moscow to request support in overcoming economic crisis and political deadlock; Russian FM Sergei Lavrov 16 April affirmed support for Hariri’s efforts to form cabinet. Meanwhile, amid dispute with Israel over maritime border demarcation, Public Works Minister Michel Najjar 12 April signed decree to formally extend Lebanon’s maritime claims to include roughly half of Karish gas field claimed by Israel; President Aoun next day declined to grant presidential approval, citing need for cabinet sign-off and warning that decree would lead to collapse of negotiations with Israel. 

Currency slide triggered fresh wave of protests, while government formation remained stalled despite international pressure. Lebanese pound 2 March fell to low of 10,000 to $1, triggering five consecutive days of protest in response to prolonged govt inaction over economic crisis; 50 demonstrators 7 March burned tyres and protested in front of banking association in capital Beirut demanding access to deposits, while protesters in northern city Tripoli blocked roads and staged sit-in. Market dealers 16 March said Lebanese pound was trading at 15,000 to dollar, representing loss of 90% value since late 2019 financial crisis began; downturn same day triggered further protests and roadblocks in Beirut. Armed forces Commander-in-Chief Joseph Aoun 8 March affirmed people’s right to peaceful protest in meeting with military commanders, warning govt that army should not be relied upon to repress popular discontent. Meanwhile, govt formation efforts faced continued deadlock. PM-designate Saad al-Hariri 17 March met President Aoun to discuss cabinet; Hariri same day agreed to additional meeting to discuss his proposed cabinet candidates, indicating Aoun should call early presidential elections if candidates are not approved. Hizbollah chief Hassan Nasrallah next day pledged support to new cabinet if announced, but cautioned against reliance on technocrats and specialist appointees. Hariri 22 March publicly rebuked Aoun over latter’s demands for veto powers in govt and continued rejection of proposed cabinet line-up. French diplomat 17 March reportedly indicated France and international partners were set to increase political pressure on Lebanon’s leadership in coming months; UN special coordinator for Lebanon next day urged Lebanese authorities to facilitate cabinet formation during address to UN Security Council. NGO Amnesty International 23 March published report documenting alleged abuses committed by Lebanese military intelligence against Syrian detainees, including fair trial violations and torture; prosecutor general 29 March ordered probe. NGO Human Rights Watch 30 March said security forces “forcibly disappeared and allegedly tortured” detained protesters in Tripoli.