A senior U.S. official warned Lebanon’s Hezbollah not to exploit its newly gained clout in the new Lebanese Cabinet and channel funds from a ministry it controls to institutions affiliated with the Shiite militant group.
The remarks by Marshall Billingslea, the U.S. Treasury’s assistant secretary on terror financing, came as Lebanese political factions agreed late Thursday to form a new government, breaking a nine-month deadlock that had deepened Lebanon’s economic woes.
The warning underscores the delicate balance that Prime Minister Saad Hariri must strike in a national unity government in which the Iran-backed group has three seats, including the Health Ministry, which has one of the country’s largest budgets.
Hariri, who hails from the country’s leading Sunni political party, reportedly had cautioned against Hezbollah holding the Health Ministry amid concerns his new government could face Western sanctions. Hezbollah made significant gains at the expense of Hariri’s party in Parliament elections in May, further contributing to the delay in forming a government as the powerful group lobbied for a bigger share in the cabinet.
Billingslea spoke to local journalists at the U.S. Embassy in Beirut at the end of a two-day visit during which he met with Lebanon’s president, prime minister, central bank governor and other officials.
“If we see that Hezbollah exploits, and they will exploit whatever ministry they are given, to funnel money and other terrorist agendas, then we have significant problems with that,” Billingslea was quoted as saying by the English-language Daily Star newspaper on Friday. He declined to elaborate what the U.S. Treasury would do in that case.
The United States has labelled Hezbollah a terrorist organization.
The new health minister, Jamil Jabbak, is not a member of Hezbollah but is believed to be close to the group’s leader, Sayyed Hassan Nasrallah, and was his personal physician at one point.
The 30-seat government has seen an increase in the number of ministries affiliated with Hezbollah, which is under tightening sanctions from the U.S.
The group has been affected recently by the U.S. sanctions as well as those imposed on its main baker Iran.
“We applied sanctions on Iran because they refuse to stop their terrorism and refuse to stop their missile launchers and funneling of their activities abroad,” the Daily Star also quoted Billingslea as saying. “And as a result of that, we are actually seeing that Hezbollah here is not getting the paychecks they once enjoyed from the Iranians.”
Hariri and Hezbollah are political rivals. Hezbollah threw its weight behind Syrian President Bashar Assad’s forces in the civil war that broke out in the neighboring country in 2011, sending its militiamen to fight alongside Syrian government troops, while Hariri and his political allies have criticized the group’s intervention, supporting at times the opposition fighting against Assad.
The new Cabinet was agreed on as Lebanon is dealing with soaring public debt of $84 billion, or 150 percent of the gross domestic product, and unemployment believed to be around 36 percent. Lebanon’s infrastructure is also reeling under the weight of a growing number of Syrian refugees: more than 1 million in a country of just over 4 million.
The government is expected to enact reforms that would allow it to unlock around $11 billion in soft loans and grants pledged by international donors at a conference in Paris last year.
Elisa Parisi-Capone, vice president and senior analyst at Moody’s Investors Service, said it expects the new government to implement measures to receive the investment package committed to by international donors last year.
“However, in the context of very weak growth, fiscal consolidation will remain very challenging for the government,” it said.