Army Deploys to Lebanon Streets as Plea to Protesters Backfires

November 13, 2019 0 By HearthstoneYarns

(Bloomberg) — The Lebanese army deployed heavily across the country and banks and schools remained shut for a second day as protesters incensed by a call to go home began to converge on the presidential palace.

Life in much of Lebanon ground to a halt a day after President Michel Aoun told anti-government demonstrators to disperse or else they’d risk the country’s stability. The appeal provoked a new surge of nationwide unrest in which one man was killed, with major roads closed on Wednesday.

Baabda Palace, the presidential residence in a mountain town on the outskirts of Beirut, is the latest focal point of the protests convulsing Lebanon since last month. While the president plays a largely ceremonial role, Aoun is becoming a target of rage since he’s calling the shots as the country endures its third week without a prime minister.

“The system is broken and the credibility is gone,” Mohieddine Kronfol, Franklin Templeton’s Dubai-based chief investment officer for Middle Eastern and North African fixed income, said in a Bloomberg Television interview with Tracy Alloway and Yousef Gamal El-Din.

Lebanon, one of the world’s most indebted nations, has been without a government since Saad Hariri resigned as premier in the face of the uprising, which is demanding the removal of politicians accused of pillaging public coffers.

It’s one of the most serious crises for the country since the end of the 1975-1990 civil war. The government’s Eurobonds are the world’s worst performers in emerging markets this quarter despite a package of emergency measures rolled out in October. Its five-year credit-default swaps, a measure of the cost of insuring sovereign debt against default, are hovering near a record high.

After appearing to lose momentum, demonstrations took an angrier turn after Aoun’s remarks as people burned tires and closed major roads. Outraged protesters stepped up demands for Aoun to resign too. Some called him “the squatter in the palace,” while others chanted “they are all a bunch of thieves.”

Speaking in a televised interview from the presidential palace, Aoun said a new government would have to resemble the lineup brought down by popular protest late last month and those who couldn’t live with the political realities should leave.

‘Such Negativity’

“I ask the Lebanese not to behave with such negativity, especially as this can lead to counter-negative behavior and, consequently, a confrontation,” Aoun said. “If they continue this way, even if we don’t give them a slap, the country will die.”

As the interview ended, thousands of people descended onto the streets across Lebanon, setting fires, pitching tents and renewing their demands for change. One protester loyal to Druze leader Walid Jumblatt was shot as soldiers tried to reopen a thoroughfare south of Beirut. He later died.

The army said one of its personnel shot the man during a confrontation with protesters and the shooter has been detained. In a video posted online, Jumblatt told his supporters to remain calm and maintain trust in state institutions.

Aoun said formal consultations to name a new prime minister would begin Thursday or Friday but could be delayed while politicians hammer out the shape of the next cabinet.

Demonstrators are calling for a government of experts that’s able to steer Lebanon through a financial crisis that has put pressure on its decades-old peg currency peg. Aoun rejected that demand, saying experts should be represented alongside the political parties that dominate the elected parliament. That includes the Free Patriotic Movement led by his son-in-law, Foreign Minister Gebran Bassil, who’s been a particular target of public insults.

Lebanon is facing its day of reckoning after years of mismanagement and excess spending. Traders and businesses are complaining about a low supply of dollars needed to pay for imports and warning of an imminent shortage of goods.

Financial Crunch

Local lenders have tightened restrictions on the movement of capital by banning transfers abroad and setting limits on withdrawals to avoid a run on the banks. Central bank Governor Riad Salameh said he’d asked bankers to ease those restrictions.

The government has few options. Already cut off from international markets, it delayed a Eurobond deal of up to $3 billion with the central bank and local lenders. Last week, Moody’s Investors Service downgraded Lebanon deeper into junk for a second time this year.

Aoun confirmed reports that while efforts were under way to push Hariri back to the premiership, he was, so far, hesitant to return. The president asked protesters to go home and allow him and the future government to carry out the reforms required, a demand that appears to have.

“We want a government that is appropriate and can fight corruption and have the courage to do so and devise an economic plan as well as prepare the country to move towards a civil society,” Aoun said.

–With assistance from Netty Ismail.

To contact the reporters on this story: Dana Khraiche in Beirut at;Lin Noueihed in Beirut at

To contact the editors responsible for this story: Lin Noueihed at, Paul Abelsky, Michael Gunn

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