On June 24, Hezbollah Secretary General Hassan Nasrallah gave a speech in which he brushed off recent American sanctions against his paramilitary and political organization.

"We do not have any business projects or investments via banks, so this action will not affect us," Nasrallah said. "We are open about the fact that Hezbollah's budget, its income, its expenses, everything it eats and drinks, its weapons and rockets, come from the Islamic Republic of Iran…As long as Iran has money, we will have money."

In accordance with the US Hezbollah International Financing Prevention Act, which President Obama signed into law in December 2015, 99 Lebanese businesses, companies and commercial concerns, along with 3,000 individuals connected to Hezbollah, have been put on the US sanctions list. Hassan Nasrallah was one of those individuals. The list also included several media outlets and contractors.

On June 10, the Lebanese Central Bank blocked 100 Hezbollah bank accounts to comply with the sanctions. The US had threatened the Lebanese government that it would impose sanctions on the whole Lebanese banking system if it failed to implement the sanctions against Hezbollah.

But Nasrallah’s admission on Friday that Hezbollah receives all its money from Iran was unprecedented. After the Lebanese Central Bank blocked Hezbollah’s accounts, the group at first objected to the decision. Now, Nasrallah is trying to dismiss the matter as unimportant.

The Lebanese newspaper Al-Akhbar pointed out that Nasrallah cannot be as unconcerned as he claims. Among the accounts blocked were those associated with Hezbollah’s social services institutions. Hezbollah prides itself on providing social services to Lebanon’s Shia Muslims. These institutions have extensive ties to Iran, and their blocking will likely disrupt Hezbollah’s ability to reward its support base.

The new round of US sanctions against Hezbollah will likely follow the same pattern as sanctions against Iran over its nuclear program. By putting financial pressure on this group, the US hopes to weaken Iranian influence in Lebanon, reduce Hezbollah’s room for maneuver, and force Nasrallah to make political concessions.

So far, Nasrallah sounds defiant. But then, so did Iranian Supreme Leader Ayatollah Ali Khamenei when Western sanctions against Iran first took effect. Eventually, Khamenei gave in to financial pressure and allowed the Iranian government to negotiate Iran’s positions.

The extent of Iran’s yearly financial aid to Hezbollah is uncertain. In October 2011, the Kuwaiti newspaper Al Qabas reported that Hezbollah receives $350 million annually from Iran. In October 2014, the French newspaper Le Monde reported the same number. This June, the London-based newspaper Al-Arab quoted US intelligence agencies, which put the number at $200 million.

 

Khamenei’s “Generosity” with Iranian Money

In addition to its annual handout, Iran has assisted Hezbollah on various other fronts. In spring 2012, Nasrallah acknowledged Iran’s help in reconstructing the war-damaged southern Beirut neighborhood of Dahieh. “Imam Khamenei,” he said, “answered the request for reconstruction with the utmost generosity, and so did President Ahmadinejad…Had it not been for the financial help of Iran we could not have started [reconstruction].”

In summer 2007, in a meeting with families harmed in the 2006 war with Israel, Nasrallah told them, “All the funding for renting temporary homes and furnishings…have come from Ayatollah Khamenei.” It is estimated that Iran contributed $400 million to the reconstruction of areas damaged by the Israeli operations in Lebanon.

Iranian provides Hezbollah military assistance, too. “We get the money the same way that we get the rockets for threatening Israel,” Nasrallah said in his Friday speech. Iran has announced that it is also ready to equip the Lebanese army.

In recent years, some Iranians have objected to their country’s support for Hezbollah as well as the Palestinian group Hamas, which controls the Gaza Strip. In the violent aftermath of the 2009 Iranian presidential elections, some demonstrators shouted, “Not Gaza, Not Lebanon! My Life for Iran!” Ayatollah Khamenei reacted with outrage. Earlier this year, he reacted similarly to a statement by the Organization of Islamic Cooperation, which accused Hezbollah of carrying out terrorist activity inside Arab countries. Khamenei said, “It could not be less important if a corrupt country [he likely meant Saudi Arabia]…condemns Hezbollah…The Islamic world is proud of Hezbollah.”

Khamenei’s latter remark may once have been true. A 2008 poll indicated that Hassan Nasrallah was the most popular leader in the Arab world. But since then, Hezbollah’s efforts to prop up Syrian President Bashar Al-Assad through military intervention in the Syrian Civil War have caused his stock to decline among Sunni Arabs.

Nasrallah’s defiance and openness about receiving Iranian arms and largesse, meanwhile, shows that, in a time of war and escalating sectarianism, these old allies believe that the best defense is a strong offense.

 

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