Dr. Jihad Azour, Lebanon’s Minister of Finance, sat down with Executive on July 29 to discuss the roles of the government and his ministry in the current war: their efforts in relief and diplomacy, how choices made in the past year have helped them meet these challenges, and what lies ahead for the economy and the state of Lebanon.

E In the coming months, everyone will be competing to adopt the issues of relief and support. The government must lead these efforts, otherwise many people may fall in the hands of other groups that want to benefit from their misery. What is your strategy for relief?
It’s a very challenging task. For the first few weeks, the government was the only provider of supplies. All the aid came from the government, through the High Relief Committee. However, due to the acceleration of the displacement, the destruction of roads, Israeli bombardments of convoys and any truck, and the difficulty of communication between various regions, the Committee opted to decentralize support, and provide the municipalities and districts with the resources to buy supplies locally and provide them to the displaced. So we paid almost LL40 billion to the municipalities directly. The objective was to give them the ability to provide basic needs without waiting for the trucks to come from Beirut or from somewhere else, to give them flexibility and quicken response times. Unfortunately, various political parties took advantage of this strategy as a way to show off and to distribute the aid in their own party’s name. It happened everywhere—all the parties did this.
E How will the government take the lead and become the primary decision-maker in these kinds of situations in the future? Hezbollah made a unilateral decision, and we’ve all had to deal with the consequences. How will the government regain power and authority in decision-making?
On many issues, the state is still the anchor of the Lebanese system. The majority of the displaced have been taken care of by state agencies: the army, the schools, the High Relief Committee, the municipalities. The government also took the necessary measures to provide unity behind these issues: in the High Relief Committee, you have more than eight ministers.
In terms of financial issues, from day one, the objective of the government has been to provide sufficient financial support to the agencies in charge of relief. In two days, we put in place the necessary support for the army, the Ministry of Health, the displaced fund and other agencies. This was possible due to efforts we’ve made in the last 12 months, which improved the financial situation substantially. We increased our liquidity; this gave us the ability to move very quickly.
The second objective was to keep government agencies functioning during the time of the crisis. We’re not getting any revenues, but we have to supply funds to the various agencies. In fact, we managed to pay on time and even early. Some bypasses and special procedures were implemented to support citizens and the business community. For example, we created a new customs office, because the ports and airport were not very safe, and we provided special procedures for supplies coming from outside.

“we are making the necessary measures
to adjust to different types of war”

The third thing that is important in countries where you have fragility, like Lebanon, is maintaining financial stability. This was a big challenge for us: to make sure the financial situation doesn’t add pressure to the monetary situation; to finance the government without being obliged to raise the Bank’s interest rate; and to maintain confidence in the system. Again, we could do this because we had made certain choices over the last 11 months. For example, on the debt front: the exchange of debt and the Eurobonds, our pre-financing strategy, all this kept us from having a big amount of debt to be renewed in the second half of 2006.

We also substantially improved the primary balance of the budget. In June 2005, the primary balance – the net operation of the government outside debt—had a surplus of LL200 billion. In June 2006, we had a surplus of LL1.2 trillion, which is five times more. We reimbursed the Central Bank $3 billion of debt that was issued last year and improved the balance sheet of the Bank. The improvement of the balance of payment was a surplus of $1.8 billion, and improved liquidity and free capital flows, which strengthened the system overall. We were not expecting what happened, but since I took office as Minister of Finance my policy has been to stay vigilant at all times, and to be proactive. You need to have your safety valves working. After almost three weeks, the system is functioning.
We are now starting to prepare for the day after the end of the war. We’re going to divide the program into two phases. Phase one is the emergency recovery: what to do for the first 90 days. We need to create solutions for a lot of problems: how to deal with the return of people to their villages, housing issues, schooling issues, and all the psychological and physical problems people are sustaining. How to deal with the infrastructure, how to mobilize funds quickly—if you go to the World Bank and others, you need to wait at least six months to get a loan. In order to act in the first 90 days, we must solve where to get the money from.
In addition, you have to figure out how to stabilize the private sector: when the war ends, you may have trouble for certain sectors in the economy, so we need mechanisms in place in advance to support the private sector. The government will also have to take care of its own financial situation, and all this must happen in the first three months. After that, we need a reconstruction plan, which will kickstart after the first phase. But the first phase is a very critical moment: to answer your question, this is how the government will take hold of the situation. This is something we have to plan and structure very tightly; the difficulty is that the situation is changing on a day-by-day basis.

E What type of state will result once the war is over? We have to decide: are we living in a state of war, where war can break out any second and destroy everything that was built? Or are we living in a different type of state where people can be confident in investing and rebuilding the country?
What type of state is viable? The viable one is a state where you have a lasting political solution, in order to assure the citizens of the South that they can go back and rebuild. You cannot bring people back to the South without that, if there’s still a threat that in five years or 20 years, everything will be destroyed again.
Secondly, you need a durable solution for both foreign and local direct investment to operate. Otherwise people will tell you, “I’m not going to adventure and invest heavily in a country where the situation may change,” and you’ll return to the economy we had during the civil war: low investment and low growth; a lot of our comparative advantages would disappear. In this type of model—one without a lasting solution— we will enter into at least five to 10 years of destabilization, especially since we have a vulnerable financial situation. During the civil war, a system was functioning. But at what cost? Per capita went down to less than $800, whereas today, we are at almost $6,000. Our exports have increased by 30%; we’re one of the best destinations for investments in the region. Our expectations were that, progressively, the Lebanese talents would come back and establish in Lebanon. This was the best tourism season for 30 years; we were expecting to import more than $10 billion this year, which gives you an idea about the economy. If you want to have a strong system, where the economy is functioning for the benefit of the citizens, the first model is the only model. This is the type of system that can survive in Lebanon. The second model cannot: it will spill over or make the financial situation unsustainable, and it will impact the socio-political stability of Lebanon. The Lebanese will not accept this kind of life.

E How likely is Hizbullah to subscribe to such an equation?
Hizbullah is not advocating the second model. Politics aside, their level of involvement in the government never gave the impression that they didn’t want the first model. I think the issue is that this war came at a time when it could be used regionally and internationally. There are other purposes, and therefore Lebanese actors become secondary in the decision-making— including Hizbullah. Rather than making the solution, we become the solution. And the solution could be in our favor, or not in our favor— that’s the risk of the current situation.
E How much has already been lost in this crisis? How long can the government support the system?
Damage-wise, I think it’s too early to get a serious assessment that indicates the magnitude of destruction and how long it will take to rebuild. In addition to the destruction of infrastructure, there are other damages to be considered. In the private sector, many industries were directly hit; certain economic activities stopped altogether. Almost all the sectors in Lebanon are suffering economically because of what happened. The owner of one of the biggest supermarket chains was telling me that 80% of his customers left the country with the evacuations. Yes, now he’s going to sell more rice and milk, but that’s not where he makes money. Every sector was hit, from agriculture to tourism to trade to banking.
There is also a negative impact on government finances. Usually, July is the month where we receive the second payment of VAT. Due to the war, we had to postpone it twice, because we cannot ask people in this time to come and pay. Our revenues are down, but our expenditures increased, and there is the risk that interest rates will go up; beyond that, the value of Lebanese assets went down.
There is also a secondary circle of lost opportunities and investment. Billions of dollars of investments were expected to be decided this summer. Now, they will be postponed at best. Many companies were looking at Beirut as their regional platform again— in the last five months, we saw tens of international companies relocating in Lebanon.
The shock is creating many waves. We can easily quantify the immediate wave when the war ends, but we also have to take the others into account if we want to kickstart the economy. We have to be imaginative. How can we involve not only donors, but also private sector investors in the solution? How can the private and public sectors work as partners to address the situation, along with the various NGOs and social communities? It’s not an issue the government or the Council of Ministers can solve alone. This has to be done on a nationwide level, with the full mobilization of all our resources, in addition to the support of others— be it international institutions, donors, expatriates, whoever wants to help.

E How many waves of impact can the government withstand? Can it last another three or four months?
We are making the necessary measures and protections in order to adjust to different types of war. We have to find solutions. We cannot say, “Ok, we can stay up and running for one month”: we have to find a solution to extend it to two, three, four, five, six months. If you have destabilization on the financial side, it will have an immediate impact on the economy and cause a disaster on the social level.

E Are we talking about stabilizing the Lira?
The whole financial situation. The monetary situation has been kept stabilized—there’s pressure, but controlled pressure. The type of crisis we are going through is different from the one experienced after the assassination of Prime Minister Hariri. The war has economic and financial implications, but our ammunitions are bigger: before the assassination, from October 2004, we had pressure on the pound. The Central Bank started using its reserves even before Hariri was assassinated. This time, the reserves were at a peak, and the balance of payments was very strong. We have already taken steps and measures to make sure that the financial situation can hold for several months.

E You’ve just returned from the
Rome conference, where international leaders failed to call for an immediate ceasefire. What did Lebanon accomplish at the conference?
From the beginning, the objective of the Rome conference was to discuss the humanitarian issues and gain support. A ceasefire was one objective, but we went knowing that we might not be able to achieve this. In diplomacy, things move progressively. This was an opportunity to present the Lebanese views to the international community and to increase support for Lebanon, and we did this. We also presented the seven points the government believes are the framework for a solution to the conflict. And we didn’t get any disapproval on these points from the international community. Rome was also an occasion for us to get a feeling for the views and positions of various parties, and to redirect some of their proposals. For example, one of the ideas was to send NATO forces and we said, “It doesn’t work, we cannot accept this.”
In addition, since Rome, pressure on the US government is much bigger than before. When the war started, the international community was not with Lebanon. The international community was even looking at Lebanon as troublemaker, and now the situation is completely different.
We were also able to achieve specific targets. For example, the conference in Rome requested the Secretary-General of the UN call for a Security Council meeting to prepare a resolution for the ceasefire. This was not granted before going to Rome. And lastly, we now know that the international community will be with Lebanon in the reconstruction and rebuilding phases. This is what the trip to Rome was about.

E Many people predict that once this is over, help will come to Lebanon: assistance with pre-existing problems and new ones created by the war. What should people expect?
First of all, we should fight to get a ceasefire as soon as possible. Not only from the humanitarian and political perspectives, which are very important, but also from an economic perspective. If the war lasts for six months, investors will turn away and go somewhere else, even if they love Lebanon. We need a ceasefire.
Secondly, I believe that this country has the strengths and the skills and the energy to rebuild itself. I have no doubt that the Lebanese are going to rebuild. Honestly speaking, this state is holding better than the state of Israel, where you see more and more division.
However, in terms of reconstruction, we have to do it differently this time. It’s not only by rebuilding the infrastructure that the economy can function. We need to develop a comprehensive strategy: how to work with everybody who is involved in the functioning of the economy, even the labor. It’s an effort where everybody has to contribute, to reactivate the economy and to get back to where we were prior to the war. And then, yes, there will be international support. We should work to maximize this support, but we also have to be realistic: we can’t say we’re going to lie back and wait until international support comes, or that someone else is going to rebuild Lebanon, and what we have to do is go to the beach. This is not the way we should do it.

The war may also provide an opportunity to make changes in certain roles and regulations in the government, I think this is a time to say, “Let’s start something new. Let’s revise some of the processes and procedures, let’s renovate some of the ways we do business in Lebanon.” It’s an opportunity.

“In terms of reconstruction, we have to do it differently this time”

E What do you think about the remarkable way in which civil society has reacted?
The Israelis made a big mistake. A lot of people did not agree with what Hezbollah did— and many voiced their disapproval— but when it came to the solidarity among the Lebanese, everybody was there. No one said, “No, I don’t want to help because the decision was not the right one, or this war is not something I believe in.” Even in the cabinet, there are political forces who are not in Hezbollah’s favor, but we’re all standing together.
People who bet negatively on the Lebanese are always mistaken.

Robert Fisk, Middle East correspondent for British newspaper The Independent, is one of the most acclaimed—and experienced—journalists in the region. Three decades in Lebanon have given Fisk a first-hand knowledge of local political and cultural dynamics that is simply unparalleled. On July 15, Fisk offered Executive his insights on the current war, speaking about Hizbullah, Israel, parallels and connections to Lebanon’s past, and his predictions for the future of the embattled country.

E Who do you hold responsible for the current conflict in Lebanon?
This is about Syria, and about Iran. This is about people needing Syria and Iran to use their influence to stop the war. The Hizbullah were well aware that they broke international law by crossing the border into Israel. They went through the wire, into Israel. They crossed the UN rules, the Blue Line. So they broke all the rules.
They must have planned a scenario. Nasrallah says this has been planned for more than five months—I’m sure he’s telling the truth. And that means they would’ve known the Israeli response, and would’ve planned their reply to that. For example, the gunboat hit last night. That wasn’t just someone who said, “Oh look! There’s a gunboat, let’s find a missile and shoot it.” That was planned before the attack across the border. It must have been. This was an Iranian long-range missile. This is very serious stuff. This is not Katyusha or Kalashnikov.
Remember that, weeks ago, they sent a drone over Haifa. I’m sure it took pictures. I would imagine they were aiming at the oil storage tanks in Haifa. And they obviously worked on the principle that Israel would reply most cruelly to that attack, which as usual Israel did, most cruelly. We’ve now got something like 90 people dead, up to date. And, as usual, the Israelis are failing in Lebanon. They sent their soldiers across the border 35 feet, they lost four men and had a tank blown up. Then they got shelled in Haifa. Then they’ve lost a gunboat. What are the gains? They’ve helped to destroy the infrastructure of Lebanon—gas stations, bridges, you name it. And they can go on destroying it and bring down the government. Then we’ll have a pro-Syrian government again and they can ask the Syrians to come back. Is that what they want?
I don’t think Olmert has any idea about military affairs, I don’t think he has any of it planned, I don’t think the Israeli military know what they’re doing. When you get down to it, killing people in trucks and blowing up homes with eight kids in them and attacking gas stations, it’s the end, isn’t it? It’s over, it’s finished. They’ve got no idea where their soldiers are and they haven’t got them back. So, if it was planned by Hizbullah to drag the Israelis into this mess, they were very successful. But they would’ve known how many innocent lives that attack across the border was going to cost. Because they were counting that Israel would attack the innocent, and Israel did, as usual. So in that sense, what Hizbullah did was reckless, ruthless, and carefully conceived. They relied upon Israel’s cruelty and they got it right.

“Who gave Nasrallah the right to take such
unilateral responsibility?”

E What sort of responsibility does Hizbullah bear for what’s happening?
Did they get a vote or a referendum from the Lebanese people to stage this attack over the border? Who gave Nasrallah the right to take such unilateral responsibility, knowing that there will be such terrible results? Nobody did. This wasn’t even Shebaa Farms. If it were Shebaa, one could understand the logic behind it. But the logic behind this is about Syria and Iran.

E So how do you think Syria and Iran can be brought into the solution?
Diplomats will go to Damascus and ask the help of President Bashar al-Assad. And one year after his army retreated in great humiliation from Lebanon, he’ll be back on the stage again.

E Do you mean that you anticipate a Syrian return to Lebanon?
No. They’re here! They’re here in the sense that they’re in our minds – look at what has happened in the South! Don’t tell me that the Syrians didn’t have any idea that such an operation would take place. I don’t mean Assad, but the ‘Syrians.’ That missile that was fired last night was a highly sophisticated, Iranian-made missile. That wasn’t brought here because somebody wanted to weight their baggage and bring their clothes in the other bag, you know? That didn’t come here because they were going to practice it. They’ve already practiced somewhere else, probably in Iran. That came here to be used on ships, and it was used, successfully. If I were the Iranian military attaché in Beirut, I would’ve been watching that with great interest. It’s test firing, isn’t it? Combat-proven, that’s what you say at arms fairs.
They’re in the market, aren’t they? The Israelis are saying “This proves the Iranian hand in all this!” Well, what’s the manufacturer of the missiles that are hitting all these houses [in Lebanon]? They’re made in California. They’re made in Seattle as well. And one of the missiles they’re using is made in Duluth, Georgia; another one is made in Florida. So, what does that prove? That proves the Americans’ hand?

E At this point, do you feel that Hizbullah is essentially directing Lebanese foreign policy?
They are! They are—the government isn’t, is it? [Lebanese Prime Minister] Fuad Seniora is reduced to ringing up Condoleezza Rice and President Bush.

E Is there a more active role the Lebanese government could take here?
Well, if [assassinated former Prime Minister] Hariri were alive, yes. Hariri would be in St. Petersburg now [at the G8 Summit], demanding to speak to Putin and Bush—and he’d get them. Fuad Seniora is a very nice guy, and I know him personally, and he’s a great economist, but in this sort of tragedy, the Senioras of this world don’t swing any weight.
E Even in a best-case scenario, where this situation resolved quickly, do you see it causing a crisis of legitimacy for the Lebanese government?
Well, it’s causing one already.

E What are the prospects for Lebanon in the short-term?
Well, you’ll have to go to Paris and ask for more money from the European Union. Which means, as usual, that the taxpayers in my country and others will end up paying for this trashing and vandalization of Lebanon. The Hizbullah —how they’ll come out of it, I’m not sure. You see, the crueler the Israelis are, the cleaner they look even though they started it. And they’ll work on that principle. And they’re correct. As usual.
When this started, most Lebanese were cursing the Hizbullah for bringing this down upon Lebanon. But I don’t think there were many Lebanese last night weeping for the crew of that ship. You see?
Syria will have proven that it decides the future of Lebanon. Not Mr. Seniora, Mr. Jumblatt, Mr. Aoun and all the other dignitaries downtown.

E On the subject of Aoun—how will current events affect the future of his relationship with Hizbullah?
Well, it was very interesting to hear the comments he made two days ago. He was remarkably soft in his comments about Hizbullah, wasn’t he? Aoun was always a very messianic person, and when he got back [from Paris] he was being hailed as this kind of savior: reading L’Orient-Le Jour when he returned home was like reading the Syria Times under Bashar al-Assad—utterly uncritical. It was like reading the Iraqi Times when Saddam was there. And since then, he’s proven what I’ve always thought, that he can be a very, very different man from the messianic general we saw before.
E What about the future of Hizbullah? Israel is saying they won’t cease hostilities against Lebanon until UN Resolution 1559 is implemented?
Israel always makes these threats. I’ve got a file I’ve pulled out on Israeli threats to Lebanon. And they’re always saying, “We’ll never release prisoners,” and then they do. They did in 2004, they did in 1985; at one point, they released 1,050 Lebanese and Palestinian prisoners in exchange for, I think, one Israeli spy and three dead soldiers. So, of course they’ll release prisoners. Ehud Olmert may not think he is, but he will.

E Even with a parallel situation taking place in Gaza?
Well, they might get the guy in Gaza, they might find him—it’s a little place, and they’re surrounded. But here, it’s a different matter. They have no idea where the soliders are, nor does anyone else. Well, someone does of course, but not me.

E You were here for the Israeli invasion in 1982. What similarities do you see between the two situations?
It’s not going to be 1982 again. The Israelis are not going to come here on foot. It was a disaster for them: this was their Iraq. They lost the whole operation. Do you remember the purpose of 1982? To secure the northern border of Israel; “We will not leave until we have wiped out the evil cancer of Palestinian terrorism.” And now it’s “evil cancer of Hizbullah terrorism.” Terrorism, terrorism, terrorism, terrorism, terrorism—I sat and watched the BBC’s coverage of the UN Security Council yesterday, and up pops the Israeli ambassador to the UN Security Council, and sure enough, he uses “terror” 20 times, or 21 times, in two minutes. It’s like a punctuation mark now, the word terror.
Everyone here who remembers ’82 will think of ’82 now, of course. I’ve been thinking about it: I’ve gone back looking at my book on Lebanon, Pity the Nation, and recalling what I wrote about it, and looking up all the quotations. “We will not stand idly by,” was one of them – the same quote used by Olmert the other day – it’s the same thing that Begin said.

E What kind of solution do you see for the present conflict?
Well, it all goes around [UN Resolution] 1559, doesn’t it? And the way Lebanon gets around it is to keep postponing things. They got the Syrians out, which everyone here more or less wanted; that put the Hizbullah in a much stronger position, of course. And they appreciate that.
Once the UN have gone and paid homage to Assad and everyone else, there’ll be some kind of agreement that the Israeli soldiers will be released soon, that there’ll be a promise through negotiators that the Israelis will release X number of prisoners, the Europeans will offer loans to rebuild Lebanon, as usual – why we should have to pay for this trash, I don’t know, but we do. The Israeli prime minister will appeal for the patience of Israelis, as complicated negotiations managed to release their soldiers, who wouldn’t have been released had Israel not taken a firm hand with Lebanon after the attack. (Laughs) Try me—see if it works. See if it still happens.

E What will be the future of Hizbullah after the war, in your opinion?
I don’t know. They wanted to be in politics and they got into politics: they went into the government, democratic elections. But they also still want to be a militia. Now, can you be a member of the government, playing a democratic role, while the same organization you belong to starts a war that devastates your country without even telling the government?
It always comes back to the same problem: this is not a modern state, because it’s a confessional state. And as long as the president has got to be a Maronite and the prime minister a Sunni and the speaker of Parliament a Shia, it can never be a modern state. But if it’s not a sectarian state, it won’t be Lebanon anymore. Big problem. Upon that, everything else hinges, including the Hizbullah.
So what will they be like afterwards? Well, it depends how many more people get killed. It depends on whether the Hizbullah score some other high-profile attack, like shooting down an airplane, for example—which I’m sure they’re thinking about. With their new missiles, I think they could probably do it—at least, they have a chance of it. And I’m sure they’ve thought about it, planned it, discussed it. I mean, that planning of that ship was done a long time ago. “Oh look, there’s a ship! Let’s go for it.” Forget it.

E Do you think the timing was intentional, coming as it did at the peak of tourist season in Lebanon and coinciding with the situation in Gaza?
Just after the exam season was over and the Baccalaureates are taking place. I noticed that, too.
But no – it needed a particular Israeli unit in a particular place. When this was planned originally, they didn’t know that Gaza was going to happen. I mean, the Hamas delegate here in Lebanon says there wasn’t any coordination; I think he’s probably right. What do you want to do, ring up Gaza and open a phone line? “We’re planning to get two guys tomorrow.” The people who did it in South Lebanon knew that Gaza was taking place, didn’t they? It had been going on for a week or so. But they weren’t inspired by it all, it wasn’t that the projects and the money came from Gaza. Hizbullah said months ago they were going to capture Israeli soldiers.
One of the dangerous sides to all this is that Hizbullah, despite its worth to the country, is a Shia Muslim organization. And a lot of Sunnis are getting killed in this. And you know, with the sectarian conflict in Baghdad.
The one thing this represents now is that the West—in terms of Israel, America, Britain, and everyone else—are all fighting Islamists. We’re fighting Islamists in Afghanistan, we’re fighting Islamists in Iraq, the Israelis are fighting Islamists in Hamas, and they’re fighting Islamists in Lebanon. When I first came here, the West was always fighting nationalists, secular nationalists. That all changed.
The other thing that’s changed is Arabs are no longer afraid. Now, the Hizbullah races to southern Lebanon to fight them. It’s not happened before. The idea that you can beat the Arabs into submission is over. It doesn’t work. Once you lose your fear—and this started in ’82—once you lose your fear, you never get the fear back again. You’re injected against it. You can’t come and re-inject a person. When the Israelis say, “We shall attack painfully,” – yeah, well you’ve done that before!

E Do you feel that anything could have been done in the past year by the Lebanese government to prevent the
current crisis from happening?
The key thing would be to get the Hizbullah to join the army. But they’re not going to join the army, because they won’t be the Hizbullah anymore. It’s interesting that the financial situation of Lebanon was much worse after Hariri’s death than it is today after this bombardment. Both in terms of stocks, and in terms of propping up the Lebanese pound. Hariri’s death proved the maturity of Lebanon, because a lot of us thought that all the ghosts were going to climb out of the mass grave and the civil war would restart. And it didn’t.

E So you don’t see this becoming a long,
drawn-out conflict?
There are too many people involved now. The UN’s involved, the G8 are involved, the Arab League are involved—not that that matters for anything; the world’s attention is on it, and people are becoming sickened by the casualties. Israeli military is coming out very poorly, not just because they’re killing a lot of innocent people. Who would ever have thought that Lebanon would produce anyone who could ever fire a missile and hit a gunboat? It was astonishing last night, it changed the whole balance of power. I mean, are those gunboats going to come back to shell the coast road anymore? I don’t think so.
They came across the border, got blown up in their tank and they didn’t come back anymore, did they?

E Based on your experience in
Lebanon, what kind of economic
impact do you anticipate?
As long as the pound stays at 1,500 to the dollar, Lebanon’s ok. I don’t know how long it can go on nursing a $39 billion public debt. People are always predicting the downfall of the Lebanese economy, and it’s true that at the start of the civil war, if you had a 50-pound note – 50 Lebanese pounds – you kept it somewhere safe. I think Hariri stabilized the economy here, and I think it’ll go on being ok.
Let’s speak with horrible frankness: this country has been repairing and re-repairing and re-repairing and re-repairing itself so long now, it won’t be long before they get those bridges back up again, and the lines repaired. I’ve seen this country devastated by 15 years of civil war, devastated in ’82 by the Israeli invasion with absolutely crushing force – whole towns went missing—and it’s all been rebuilt. And it will be again. And the French will help.
I don’t know what the effect will be on the Israeli economy. Apparently, the Shekel is falling against the dollar at the moment. It’s one thing for the Israeli officials to say they’re going to put Lebanon back 20 years, but Israel could go back 20 years, too. I remember when they had to replace the old Shekel with the New Shekel, and that was a shock.
The other thing which will have a big effect on the G8 is that this is pushing up the price of oil even higher. It’s now almost at $80 a barrel. Just think, it was $16 a barrel at the 1991 Gulf War! That hurts America in its pockets, and I think that if America is hurt in its pockets, it matters more than America’s support for Israel. And that is what the G8 summit will actually be talking about: the dollar, and the barrel and the oil. That’s what it should be talking about, I should say. And this is having its effect; Israel always appeals to the world’s conscience, but it never seems to heed what the world needs as well— that there are other people living on this planet who also have needs, like driving their cars. I’m sure there will be efforts contrived to blame the Arabs for all this – I suppose you can blame the Hizbullah as well—but I think that Lebanon will survive, it always does.
I always remember this wonderful mythical story of the Australian economist who was invited by the Chamber of Trade, before the civil war, to come here and explain to them how the Lebanese economy works, and he spent two or three weeks researching, and talking to everyone and reading every book and pamphlet and came back, and stood up allegedly in front of the Chamber of Commerce and said, “Ladies and gentlemen, I haven’t the slightest idea what you’re doing, but keep it up!”

“[Lebanon] will be [rebuilt] again. and the french will help”

E Are Hizbullah’s actions – kidnapping the two soliders— in any way excusable?
You can look at it in certain ways. Number one, there are still people locked up in Israeli jails. Including hundreds and hundreds of Palestinians without trial. And no one’s got them out. This is the only way that has ever got them out of prison, apart from the Oslo agreement. So, that’s one argument that the Hizbullah have put forward already.
Another one: the Israeli prime minister says its “an act of war,” and the Lebanese government has to take responsibility for it. And we all know that they can’t take responsibility for a single militiaman – it’s untrue. But if you apply the same standards, when Jewish settlers kill and murder Palestinians—holders of Israeli passports coming from Israel, landing at Tel Aviv airport from America in some cases—can the Palestinians declare war on the Israeli government? Do they blame the Israeli government for it, even though the government has actually armed the settlers? They don’t. They may blame Zionism, they may blame the way Israel is run, but they don’t declare war on Israel, do they? But Israel can declare war on the Lebanese government. Or say it’s an act of war. Odd, isn’t it?
Israel can do more or less anything they want anywhere, can’t they?