Monday, December 5, 2011


Three disturbing incidents occurring in South Lebanon recently must be factored in by compliance officers who are calculating country risk for Lebanon. As you may not be aware of them, I will cover them in brief:

(1) Four rockets were launched, from Southern Lebanon, in Northern Israel, the first such attacks in two years. Though they were reportedly launched from Hezbollah-controlled territory, a Palestinian group later claimed responsibility.
(2) An unmanned drone, believed to have come from Israel, was captured on the ground by Hezbollah, and later taken to who has been described as an arms depot of that organisation. It is said to have been detonated in a massive explosion.
(3) Hezbollah agents claim to have uncovered, and have captured and displayed, a device it alleges was a remote listening post for electronic communications of the Hezbollah private communication network, which operates independently inside Lebanon.

It is too soon to say whether the risk of armed conflict on the border has increased, but since any military action, whether sustained or of brief duration, would have a disastrous effect upon the Lebanese financial industry, country risk watchers should monitor the situation accordingly.

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