Abou Zaki: Saudi Measures Impinge on Lebanon's Economy

CEO of Al Iktisaad Wal Aamal Group Raouf Abou Zaki stated on Wednesday that the latest Saudi measures against Lebanon have a direct effect on the financial and economic situation but assured that no measures have been taken against Lebanese expats so far.

“The Saudi measures against Lebanon have a direct impact on the economic and financial situation in the country,” Abou Zaki told the Voice of Lebanon radio (100.5).

“The damages have worsened and we fear for the fate of Lebanese expats in Saudi Arabia. Any measures taken against them will reflect negatively on the capital,” he added.

Abou Zaki's comments came following a Saudi decision last week that halted $4 billion grants to the Lebanese military to review its diplomatic relations with Lebanon. The stance came after Lebanon's foreign ministry declined to vote in favor of Saudi-backed resolutions against Iran during two meetings of Arab and Muslim foreign ministers.

Furthermore, on Tuesday Saudi Arabia, UAE and Bahrain advised their citizens against travel to Lebanon and urged those already in the country to leave it, citing “safety” concerns.

The step developed fears that the Gulf countries could escalate measures even further and expel Lebanese expats working there.

“So far there are no indicators that any measures have been taken against Lebanese workers in the Kingdom,” assured Abou Zaki.

As for fears that Saudi Arabia could withdraw the deposits from Lebanon’s banks, Abou Zaki stated: “Gulf deposits in Lebanon are not large. The consequences are more moral than economic.”

He concluded by saying: “The crisis will be long. But I rule out the possibility that relations between the two countries will be severed. The Lebanese government must take a clear unwavering stance towards the Kingdom.”

Gulf deposits at the Central Bank of Lebanon amount to about $860 million including $250 to $300 million as a Saudi Arabian deposit, according to As Safir daily.

These government deposits were used to support the monetary stability and have given confidence for the cash and the Lebanese financial sector in previous years, added the daily.

Lebanese expats transfer around $8.7 billion a year, 55 percent of them from the Gulf countries (about 70 percent from Saudi Arabia).

The number of Lebanese expats working in the Gulf states are nearly 400,000 mostly in Saudi Arabia.

D.A.

G.K.