HEZBOLLAH THREATENED BY IRAN'S FINANCIAL WOES

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ONLINE FEATURES
Hezbollah Threatened by Iran’s
Financial Woes
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Oren Kessler and Rupert Sutton
ran’s economy continues to flounder. It is
hemorrhaging money in Syria, and years of
sanctions have left it suffering from high
unemployment (a quarter of youth are jobless)
and the world’s second-highest inflation rate
(20 percent ), despite a minor boost provided by
an interim nuclear agreement. Now, however,
Iran’s economic woes are beginning to affect
its ability to project power across the region,
potentially leaving its most dangerous
international proxy in the lurch.
Sources close to Hezbollah told Lebanese media
last week that Iranian funds to the group are
drying up. In the words of Hezbollah expert
Matthew Levitt, “Iran is not in good financial
shape; the money from Tehran [to Hezbollah]
doesn’t come as it used to.” As a result, the
group’s military wing has reportedly ordered
its overseas cells and external security units
to find new revenue streams, and its social
services have also had to cut costs.
Over the past three decades, Tehran has
funded Hezbollah terrorism around the world,
from its 1983 bombings of US and French
barracks in Beirut that killed 299 servicemen,
to attacks in the early 1990s at Jewish and
Israeli centers in Argentina that killed 114.
That relationship has continued to this day—
in 2012 Hezbollah bombed an Israeli tourist
bus in Bulgaria , killing six, and the same year
planned a similar attack in Cyprus. The group
has been accused of attacking diplomats as far
afield as India and Georgia, and last month
its operatives admitted to plotting attacks on
tourists in Thailand.
At the same time, Hezbollah also operates a
global network of criminal and narcotics
rings. In West Africa, it has made millions
trading in blood diamonds and arms. In
Colombia, its members have been convicted of
cocaine trafficking, and in the lawless border
areas between Argentina, Brazil, and
Paraguay it runs smuggling networks
transporting marijuana and tobacco. In the
US, officials have uncovered a multimillion-
dollar Hezbollah-run smuggling ring dealing
in drugs and cigarettes.
As less money comes in from Iran, Hezbollah
will likely have to turn to these illicit
operations even more to make up the
shortfall. Last week, however, a bill was
introduced to the US Senate that seeks to
challenge the group’s money-laundering and
logistics operations, designating Hezbollah as a
narcotics-trafficking and transnational
criminal organization. The bill would place
sanctions on individuals and firms conducting
any business with Hezbollah, severely
hindering the organization’s ability to
fundraise at a time when its coffers are
already drying up.
With its diminished financial prospects,
Hezbollah’s overseas cells could face an
accompanying decline in the group’s ability to
conduct both terror attacks and criminal
activity. The failure of its recent attacks in
Cyprus, India, Georgia, and Thailand indicate
that its operational capacity is already
compromised—something money troubles will
only exacerbate.
Meanwhile, Iran continues to bankroll the
Syrian government in its brutal three-year
war against rebel forces. Tehran is believed to
provide the Bashar al-Assad regime with
upwards of $600 million monthly to prosecute
the war and cover its fiscal deficit. For its part,
Hezbollah is itself losing money , pledging to
provide for the families of up to 500 of its
fighters killed in battle alongside Syrian
forces.
Rogue behavior carries costs. The Islamic
Republic’s nuclear program has devastated its
economy, raising fuel, food, and energy prices
for ordinary Iranians. Its three-year
campaign to save the Syrian regime is
bleeding its bank accounts, and damaging its
ability to fund terror beyond its borders.
The Syrian tragedy has claimed as many as
160,000 lives , with no end in sight. Still, in the
dark clouds above Damascus a silver lining
may be emerging: the weakening of the
Islamic Republic and its most dangerous
proxy.