Bankrupt Lebanon left to rue criticism of Saudi Arabia

George Kordahi was a little-known radio editor before the Lebanese broadcaster landed a job in 2000 that would make him a star — presenting the Arabic version of Who Wants to be a Millionaire?. The game show aired across the region on MBC, a channel bankrolled by Saudi Arabian royals.

Yet 10 years after quitting MBC, the media personality who was recently appointed Lebanon’s information minister, has just lost his bankrupt country hundreds of millions of dollars — by infuriating his former Gulf patrons. Kordahi’s criticism of Saudi and the UAE’s war against Iran-aligned Houthi rebels in Yemen, in a video that resurfaced late last month, has caused a diplomatic firestorm.

Saudi Arabia responded by banning all Lebanese imports, expelling Lebanon’s ambassador and recalling its envoy in Beirut. Gulf allies also cut diplomatic ties with Lebanon. Altogether, these measures have delivered a serious blow to a country already in the throes of its worst ever peacetime economic crisis.

In its dramatic economic collapse, Beirut has been even more dependent on cash flows from the Gulf, “the lung of Lebanon since the 1950s,” said Roy Badaro, a Lebanese economist. Of the recent diplomatic spat, “Lebanon cannot bear this shock for a long period,” Badaro warned.

For the Gulf states that had financially boosted previous Lebanese administrations, the Kordahi comments ignited long-simmering grievances, dramatically crystallising all that had gone wrong in a once close relationship.

The rise of Iran-backed Hizbollah, the powerful Shia paramilitary and political party, has long rankled Lebanon’s Gulf allies, who have seen their own influence wane. Hizbollah is allied with the Christian party Marada that backs Kordahi.

After Riyadh pulled its ambassador, Saudi Foreign Minister Faisal bin Farhan told the Saudi-owned Al-Arabiya TV that there was a “crisis in Lebanon because of the domination of Iran’s agents on the scene”.

“This is what concerns us and this is what makes dealing with Lebanon futile for the kingdom and Gulf countries,” he said. 

Some see an ‘ingratitude’ in Kordahi’s comments. Fouad Makhzoumi, a Lebanese tycoon and Sunni politician who has business interests in the Gulf, said: “There has been . . . a compilation of disgust towards the Lebanese. This last thing [was] the triggering effect.”

Gulf states donated billions of dollars to rebuild Lebanon after its devastating 15-year civil war ended in 1990, a period of strong Lebanon-Saudi relations under premier Rafiq Hariri. A construction magnate, Hariri had made billions in Saudi and encouraged the Gulf investment in Lebanon. The erosion of this relationship began with his assassination in 2005 — a killing blamed on Iran-backed Hizbollah. The worst spat came in 2017, when Saudi Arabia briefly detained then prime minister Saad Hariri, Rafiq’s son, temporarily forcing him to resign.

In the interview broadcast by Qatari outlet Al Jazeera, Kordahi called Saudi Arabia’s proxy war in Yemen with the Houthis a “futile” conflict and described the Houthis as “defending themselves against a foreign attack”. When Kordahi’s comments went viral, the Saudis went “totally ballistic”, said Heiko Wimmen, Crisis Group’s project director for Iraq, Syria and Lebanon.

“Riyadh is lashing out at those who have profited and then underdelivered, betrayed, disappointed or manipulated it,” said Emile Hokayem, senior fellow for Middle East Security at the International Institute for Strategic Studies. But now “Saudi leaves a vacuum, especially in the Sunni community,” whose political factions have traditionally relied on Saudi Arabia for backing.

The harsh reaction is a severe shock to Lebanon’s economy. More than half of Lebanon’s population has been impoverished since a complex financial and economic crisis broke out in 2019. It has only recently appointed a fully functioning government after a caretaker administration held the fort in the wake of a devastating 2020 blast in Beirut port.

The Gulf is Lebanon’s main export destination, an important source of hard currency. Saudi Arabia was Lebanon’s biggest agricultural export market in 2020, and total exports to Saudi alone were worth well over $200m last year, according to customs data.

Meanwhile, the central bank estimates some 60 per cent of remittances originate in the Gulf, where some half a million Lebanese expats earn petrodollars which have been Lebanon’s economic lifeline.

For the insulted Gulf, “this is an absolute, irreversible rupture”, said Abdulkhaleq Abdulla, an Emirati professor of political science. “As long as Hizbollah is in power, then I think the UAE and Saudi Arabia have decided to give up on Lebanon.”

If the two Gulf powerhouses abandon Lebanon, Hizbollah “will try to project in the media that they have won, that they have pushed Saudi outside,” said Makhzoumi.

However, if the Gulf escalated, by further limiting Lebanese business or stopping money transfers, for example, Hizbollah’s money “would never be able to replace it”, Makhzoumi said. “So this bullshit that they don’t give a damn, it is good for among their own people, to show that they are Rambos. But when it comes to the real country, how many can they support?”

Yet Kordahi has refused Sunni prime minister Najib Mikati’s entreaties to resign. Hizbollah dismissed calls for Kordahi to quit, calling them “a blatant attack on Lebanon, its dignity and sovereignty.” Meanwhile, in Houthi-held Yemen, billboards featuring Kordahi have appeared.

“Today, if they sack Kordahi, what will we reap from the kingdom?” Lebanese foreign minister Abdallah Bou Habib said in leaked comments, which he did not deny. “Nothing. They will ask for more things.”

Kordahi was one of many Lebanese to benefit from the golden years of the Gulf’s relationship with Lebanon. Millionaire, initially shot in Beirut from 2000, helped make him the “highest paid television presenter in the Arab world”, according to his website. A household name in the region, he secured lucrative advertising contracts and launched his own perfume and clothing line.

Yet in recent years, Kordahi had expressed views controversial to his former Gulf paymasters. He publicly praised Hizbollah leader Hassan Nasrallah, in 2013 calling him “smart, courageous.” Kordahi also left MBC over his support for Syrian president Bashar al-Assad.

Amid the furore, Hizbollah is defiant. “Saudi Arabia is troubled because it could not dominate the political decision in Lebanon, despite the money it paid,” said Hizbollah deputy secretary-general Naim Qassem on Wednesday. “No one can twist the arm of Hizbollah,” and, he added, “the Lebanese people.”

Additional reporting by Simeon Kerr in Dubai and Andrew England in London.