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Hariri Camp Backs UN Probe as Hezbollah Fells Cabinet

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Lebanese Prime Minister Saad Hariri
Lebanese Prime Minister Saad Hariri said he will work to help find solutions that guarantee national unity. Photographer: -/AFP/Getty Images

Jan. 13 (Bloomberg) -- Lebanon’s political divide deepened as supporters of Saad Hariri affirmed backing for a United Nations inquiry into his father’s killing, hours after Hezbollah and its allies brought down his government.

“There will be no compromise over the tribunal or justice,” Labor Minister and Hariri ally Boutros Harb said in a televised statement in Beirut, calling yesterday’s resignation of 11 ministers an attempt at “political paralysis.”

Hezbollah, whose backer Syria was the target of street protesters who blamed it for Rafiq Hariri’s killing in 2005, has demanded an end to the UN inquiry, saying it is biased. Energy Minister Gebran Bassil, announcing the cabinet walkout at a press conference in Beirut yesterday, said that Hariri had “succumbed to external pressure, including from the U.S.”

Hariri was in Washington for a meeting with President Barack Obama when Bassil made his announcement.

As the UN tribunal prepares to issue an indictment, tensions in Lebanon have escalated on concern it may implicate Hezbollah in the killing. That would raise the prospect of a return to violence in a country that emerged from a 15-year civil war in 1990 and has seen frequent recurrences of sectarian strife since then.

Hezbollah and Syria deny responsibility for Hariri’s death. The Shiite Muslim group’s leader, Hassan Nasrallah, said in a Nov. 11 speech that Hezbollah won’t allow its members to be detained and would “cut off the hand” of anyone who attempted to arrest them.

Indictment Due

UN prosecutor Daniel Bellemare is due to file charges with the pretrial judge, Daniel Fransen, by the end of March.

Hezbollah and its partners held 10 of Lebanon’s 30 Cabinet seats. An 11th minister, Adnan Sayyed Hussein, also quit, the National News Agency reported, enough to topple Saad Hariri’s 14-month-old national unity coalition. Bassil called on President Michel Suleiman to take the necessary steps for the formation of a new government.

The lack of a functioning administration will make it “impossible for the government to actually play its role as the partner of the international tribunal,” said Rami Khouri, director of the Issam Fares Institute for Public Policy and International Affairs at the American University of Beirut. “This is one of the aims of the opposition.”

Power-Sharing

Hariri’s coalition won 71 out of 128 seats in the 2009 elections, with the rest going to Hezbollah and allies including former general Michel Aoun, who heads the assembly’s biggest Christian group. In Lebanon’s power-sharing system, the president has to be a Maronite Christian, the prime minister a Sunni Muslim and the parliament speaker a Shiite Muslim.

Suleiman asked Hariri to remain head of a caretaker government until a new cabinet is formed, presidential spokesman Adib Abi Akl said by phone today. Suleiman met with Speaker Nabih Berri today, who said the president will begin talks with lawmakers on Jan. 17 to designate a prime minister.

Obama said the Hezbollah-led resignations “only demonstrate their own fear and determination to block the government’s ability to conduct its business and advance the aspirations of all of the Lebanese people.” U.S. Secretary of State Hillary Clinton called the walkout a “transparent effort” to subvert justice.

The U.S. classifies Hezbollah, which won support by helping to push an occupying Israeli army out of south Lebanon in 2000, as a terrorist group.

Meeting Sarkozy

Saad Hariri left Washington late yesterday for Paris to meet President Nicolas Sarkozy. France confirmed “its attachment to the work of the special tribunal and to its independence,” Foreign Ministry spokesman Bernard Valero said.

The benchmark BLOM Stock Index dropped for a second day, falling 0.3 percent to 1,484.90 at the close in Beirut. The measure tumbled 3.2 percent yesterday, the most since July.

“The fluctuation of share prices on the Beirut Stock Exchange is driven by political sentiment rather than by the underlying performance of listed companies,” said Nassib Ghobril, head of research at Lebanon’s Byblos Bank SAL.

Hezbollah’s withdrawal from the government may set back an economy that performed “remarkably well” through the global economic crisis because of the “more stable environment” under Saad Hariri, according to an October report by the Washington-based International Monetary Fund. The IMF projected growth of 5 percent this year, slowing from 8 percent in 2010.

Growth at Risk

Political tension has already hurt the economy and Hezbollah’s walkout will “erode confidence and may heighten the risk of a further slowdown,” Eric Mottu, the IMF representative in Beirut, said in a phone interview yesterday. “For growth, investment, consumption and tourism it could be a risk.”

An additional concern is how the resignations “translate onto the street,” said Walid Arbid, a law professor at the Lebanese University in Beirut.

The last time Hezbollah walked out of a government, quitting the Cabinet of then Prime Minister Fouad Siniora in 2006, it marked the start of an 18-month political paralysis. That culminated in an outbreak of civil strife in May 2008, when at least 80 people were killed after Hezbollah and its allies seized control of west Beirut.

Rafiq Hariri and 22 others were killed by a roadside bomb in Beirut in February 2005, sparking protests by millions of Lebanese that led to the ouster of Syrian troops from the country after 29 years.

An initial UN inquiry charged four pro-Syrian officials in Lebanon’s security services. They were held in jail for four years before being released in 2009 by the tribunal due to a lack of evidence, after some witnesses changed or retracted statements. Hezbollah has called for the prosecution of the so-called “false witnesses.”

To contact the reporter on this story: Massoud A. Derhally in Beirut, Lebanon, at mderhally@bloomberg.net

To contact the editor responsible for this story: Louis Meixler at lmeixler@bloomberg.net.

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