The Beirut Port explosion in its economic context

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Phoenician trade was mainly a distribution of oriental goods in the Mediterranean.


Now, centuries later, Lebanon should have everything to gain by ditching the “Paris of the Orient” mythology and start looking east again, to thus position itself on the right side of international trade and economic growth.


After violent protest against the last Government of the Hariri Dynasty, a new parliamentary cabinet was formed in Lebanon on 21 January 2020, headed by Prime Minister Hassan Diab.


The Diab government was approached by the Chinese to become a partner in the Belt and Road Initiative. As soon as they agreed, they started to be harassed by the international financial community, asking them to repay the Hariri regime’s debts. In exchange for financial help, they were supposed to adopt the usual neoliberal package of reforms, including the privatisation of the Beirut Port infrastructure, but the government was reluctant, because there was a big port development project financed by a Chinese Company specialized in port infrastructure.


Then came the huge explosion that partially destroyed the port and the adjacent part of Beirut’s old city.


There is a narrative about an ammonium nitrate cargo deposited at the port and of neglect of the danger it posed by the new government authorities.


Similar to how Covid-19 has been instrumentalized by the 1% to socially engineer a Universal Social Class Reset project, the Beirut tragedy is already being instrumentalized by the usual suspects to keep Lebanon enslaved to the Western financial elite.


The Western spokesman was French President Macron, who appeared in Beirut in a paternalistic colonial attitude, offering to pay off Lebanon’s creditors in exchange for the exclusive use of the deteriorated Beirut Port.


Facing color-revolution style “protests”, the current Lebanese government led by Prime Minister Diab has already resigned.


France and the UN organized a videoconference to coordinate donor response – in conjunction with the European Commission (EC), the IMF and the World Bank. The result was not brilliant: a paltry 252 million euros were pledged – once again conditioned by “institutional reforms” to get Hezbollah’s representation out of the Lebanese Parliament.


Crucially, neither Russia nor Iran were among the donors. The US – which is harshly sanctioning Lebanon – the GCC allies and Saudi Arabia and UAE pledged nothing. China had just a pro forma presence.


In parallel, Maronite Christians in Brazil – a powerful community – are sending funds for the color-revolution protests. Former Brazilian President Michel Temer and Brazilian tycoon Paulo Skaf even flew to Beirut. There is a big Lebanese business presence in Brazil since the period of Amin Gemayel in Lebanon (1982-1988).


Their presence in Beirut points to neoliberalism trying to keep a grip on Lebanon, to avoid a return of Chinese trade to the Mediterranean.


Lebanon’s economic crisis, now aggravated by the Beirut port blast, has a lot to do with the US proxy war on Syria – which brought a million refugees to the nation. It is all about the neoliberal reform package that makes countries slaves to the world financial elite and to keep away Chinese financial options.


There is absolutely no evidence the IMF, the World Bank and Western/Arab “donors” will extricate a now devastated Lebanon from the neoliberal logic that plunged it into a systemic crisis in the first place.


The way out is to focus on productive investments, away from speculative finance and geared towards the practical necessities of the real economy of goods and services for an impoverished population.


In contrast with the perpetual speculation Western neoliberal model, China is offering Lebanon the chance to turn east, and be a part of the New Silk Road common development world perspective.


In 2018, Lebanon became the 87th member of the Asia Infrastructure Investment Bank (AIIB); the bank that coordinates investment in the international infrastructure project known as the Belt and Road Initiative.


Lebanon was already taking part in the internationalization of the yuan, offering bank accounts in yuan and increasing bilateral trade in yuan.


Beijing was engaged in discussions over the upgrading of Lebanese infrastructure – including the expansion of the Beirut port. That may be a reason for the timely explosion.


This means that now Beijing may be in position of offering a renewed, joint rebuilding and security deal for the Beirut port. The explosion happened just as it was about to clinch a smaller agreement with Diab’s government, focused on expansion and renovation of Beirut’s Port.


The bottom line is that China has an actual Plan to extricate Lebanon from its current financial dead end.


That is anathema to US and Israeli interests.


The US administration recently prevented Israel from having China develop the port of Haifa.


The same gangster tactics will be applied with full force to whoever leads the next Lebanese government.


Beirut is a key node in the Belt and Road Initiative concerning its connection with the Eastern Mediterranean.


With Haifa out, Beirut grows in importance as a gateway to the EU, through the Piraeus and Italian Adriatic ports.


It is crucial to realize that the Beirut port itself was not completely destroyed. The explosion destroyed only a section of the quayside. The buildings can be rebuilt in record time. Reconstruction of the port is estimated at $15 billion – pocket money for an experienced company such as China Harbor.


Meanwhile, naval traffic is redirected to Tripoli, 80 km north of Beirut and at 30 km from the Lebanon-Syria border. Tripoli’s port had already been expanded by Chinese companies, and received the largest container ships from China.


Added to that, the Tripoli port will also be essential in the process of Syrian reconstruction – to which China is totally committed.


The Belt and Road Initiative will connect Southwest Asia to a network that includes Iran, Iraq, Syria and Lebanon.


China is already investing in highway and railroads to develop a high-speed rail. That train will connect Lebanon with a central China-Iran corridor in which Lebanon will be the door to the Eastern Mediterranean. This Project requires a $400 billion investment during a 25-year strategic partnership.


There is also a role for the port of Tartus in Syria, which is now a key Russian naval base. Beijing will expand the role of Tartus linking it by highway to Lebanon.


A Russia-China strategic partnership will be involved in the protection of Tartus and the highway, with S-400 missile systems.


Historically, the region was part of a large axis that went from Samarkand to Cordoba, with strong nodes in Baghdad and Damascus. The trade that evolved in this part of Eurasia developed a civilization that took precedence over an ancestral rural and nomad background. The internal cohesion shaped a coherent Eurasia, the cradle of civilization.


The Middle East and the Eastern Mediterranean have always been linked by open routes towards the Indian Ocean. Caspian routes to Central Asia were blocked for over 10 centuries by an intolerant Muslim monotheism embodied later by the Turkish Empire.


Now those routes will be open again, as when religious neutrality allowed for trade between the Roman and Chinese empires.
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