When the United States Treasury Office of Foreign Assets Control announced a new round of sanctions earlier this month against accountants and an alleged arms dealer associated with Hezbollah, they added to a growing list of sanctioned individuals and entities affiliated with the group.
While the sanctions effectively cut off listed entities from doing business abroad and make it more challenging for them to take part in the global banking system, many of these people and companies operate solely in Lebanon.
Due to the ongoing economic crisis, the country has basically become a cash-based economy, and Hezbollah affiliates primarily associate with others who are already sanctioned by the US for their work with the group or are likely to also be sanctioned by them in the future.
For those who are actually sanctioned by the US, it has essentially become a rite of passage and almost a sign that they are considered important enough by the US government to warrant specific targeting.
One of those sanctioned by the US on 1 December, Adel Mohamad Mansour, the executive director of the previously sanctioned al-Qard al-Hassan group, laughed off the sanctions, saying that they have no real impact on Hezbollah and its activities.
"I don't care about this at all," he stated. "Since I joined [Hezbollah] I have been expecting anything."
For Hanin Ghaddar, the Friedman Fellow at the Washington Institute's Programme on Arab Politics, any US sanctions against Hezbollah and its affiliates mean very little and do not have a significant material impact as they are often limited in scope and are not coupled with other policies to weaken the Iran-backed group.
"So far, the only Hezbollah policy in Lebanon is sanctions, which are not very effective because Hezbollah’s economy is a cash economy," Ghaddar told The New Arab. "So when you sanction a Hezbollah official or a Hezbollah financer, it is more symbolic than practical.”
Self-inflicted wounds
When Hezbollah first publicly announced its existence in the 1980s, it was quickly given a terrorism designation by the US and has been consistently sanctioned since then.
However, this has done little to prevent the Party of God from ascending to power in Lebanon and becoming what is arguably the most powerful non-state actor in the Middle East, assembling an arsenal and fighting force that rivals that of many modern militaries.
This has not been for a lack of effort on Washington's part, which has worked to try and curb the group's presence in its native Lebanon and, by extension, Iran's growing influence in the region.
According to Mohanad Hage Ali, a senior fellow at the Carnegie Middle East Centre in Beirut, the US has had two main policies in Lebanon when it comes to countering Hezbollah: sanctions and supporting Lebanon's military.
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The targeted sanctions did, to a certain extent, have an effect on Hezbollah.
"These mounted the pressure on the organisation, leading to tensions with compliant Lebanese banks," Hage Ali told The New Arab, adding that the sanctions also helped to isolate the "organisation from the business community in the diaspora and its non-Shia allies".
This policy, though, was severely undermined during the Trump administration, which seemingly implemented sanctions at random in a "chemotherapy" style attempt to send a shock through the entire system in order to target Hezbollah.
The Trump administration's sanctions policy also inadvertently created new avenues for Hezbollah to get around the sanctions, and make deals outside of the US-controlled financial system through Iran and China.
These wide-ranging sanctions also severely undermined the US policy of supporting the Lebanese military. "A stronger army meant less manoeuvre space for Hezbollah, a counterargument for their alibi to keep their weapons," Hage Ali explained.
When the US began trying to shock the system to remove Hezbollah, Saudi Arabia, a long-time financer of Lebanon, joined in on the new policy, taking incredibly brazen actions like kidnapping then-Prime Minister Saad Hariri and forcing him to resign, ultimately leading to large amounts of money leaving the country. This hastened Lebanon's economic collapse in 2019.
Now, with the economic crisis entering its fourth year, far from a modern fighting force, the Lebanese army is fighting to survive and has increasingly become dependent on international aid.
"The US strategy failed to impact Hezbollah in the way it was intended to," Hage Ali said. "If anything, the heavy-handed sanctions policy worked against the long-term challenges against the party. Basically, weakening the army which is supposed to take on the role of protecting the country’s borders, and against outside aggression."
Rather than continuing its policy of sanctioning Hezbollah and supporting the military, Ghaddar argues that the US needs to shift its policy focus if it wants to have any real chance of impacting the armed Shia group.
"If you look at Hezbollah’s pillars of power in Lebanon, it is really their allies, their weapons and the Shia community," she explained. "Without these, Hezbollah does not really have that much power in Lebanon."
Changing focus
After starting out as an armed militia focused solely on resisting the Israeli occupation of South Lebanon, Hezbollah has shifted, becoming the most dominant political and military force in Lebanon, effectively giving the group the power to do as it pleases without being challenged.
This power that the group wields stems from the alliances it has formed over the decades, such as with the Maronite Christian Free Patriotic Movement (FPM), its powerful military force and the support of Lebanon's Shias gained by providing the community with security, services, jobs, and money, as well as a healthy dose of fear.
Rather than fruitlessly continuing to sanction Hezbollah, Ghaddar believes that the US needs to shift its focus to these three pillars that help support the group.
For its part, the US has pursued this to a limited extent and sanctioned some of Hezbollah's allies, the most notable being the 2020 sanctioning of the FPM's leader Gebran Bassil.
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While Hezbollah might not have a problem with being sanctioned, by targeting its political allies, sanctions could make parties and politicians think twice before aligning themselves with the Shia party, creating the opportunity to isolate Hezbollah politically.
However, Ghaddar pointed out that, "the scope has been very limited and not every Hezbollah ally in Lebanon has been sanctioned," arguing that if the US wants to be effective in this field, then they need to expand on these actions.
Ghaddar also pointed out that the US cannot do much to target Hezbollah's weapons outside of political and diplomatic channels, making it that much more important for the US to do more to sway the Shia community away from their long-serving patron.
This means providing the Shia community with viable and long-term financial and economic alternatives that allow them to be independent of Hezbollah.
"You can easily work with the Shia community in terms of providing economic alternatives because now, and now more than ever, Hezbollah’s number one source for the Shia community is jobs and money," Ghaddar stated.
"There is an opportunity there because Hezbollah’s budget has shifted in the last few years many times and they are no longer catering to the whole of the Shia community. And with the current crisis, many Lebanese, including the Shia, are looking for different sources of income."
This could be accomplished through collaborating with Lebanon's private sector to create more job opportunities for the Shia community, but, Ghaddar admitted, all of this is something that the US is so far failing to recognise and capitalise on.
"None of this is being done. Just some limited sanctions here and there and we haven’t really seen any sanctions against Hezbollah’s allies in a long time," Ghaddar said.
The main reason for the lack of action is that Lebanon, and the Middle East as a whole, have become less of a priority for the US government, which has instead been focusing its attention on China and, more recently, Russia following its invasion of Ukraine.
While the US could delegate a lot of the work when it comes to sanctions to its European allies, in particular, France, given the European nation's relationship with Lebanon, the political will seems to be lacking.
Even though the US continues to put out statements condemning Hezbollah and its actions, as long as the Western superpower continues with the same inefficient policies that it has been utilising for decades, it will do little to curtail Hezbollah’s domination.
Nicholas Frakes is a journalist and photojournalist based in Lebanon reporting on the Middle East.
Follow him on Twitter: @nicfrakesjourno