The power of Hizbullah in Lebanon is not restricted to its military forces and rockets, but also extends to its control over enormous economic and social infrastructures. The economic structure of the Hizbullah can be divided as follows:

• Iran – the vast majority of the social and economic array of the Hizbullah is sponsored by Iran, which transfers tens and even hundreds of dollars every year.

• Economic enterprises – the organization is a partner or holder of several profitable economic enterprises that bring into its coffers large amounts of money. The construction company of the organization is one example of such a body that is quite profitable, as is the partnership with the Lebanese airline company.

• Service fees – not all of the social activities of the organization (hospitals, schools, summer camps and kids’ activities and lending organizations) are free of charge. The organization takes a sliding-scale fee for part of these services. Most of the organization’s social activities take place in the south.

• Donations from private persons- mostly from Shi’ite communities in Africa and South America.

• Charitable Institutions – Hizbullah operates a network of charitable institutions outside of Lebanon that brings money into the organization.

• Organized crime – The organization operates crime networks both within Lebanon and outside of it that deal with money laundering, drug and other types of smuggling and financial bribery. As in the instance of Hamas, the organization’s social network is a source of real popular support for the organization. The assessment is that the Hizbullah supplies approximately 10% of the services to the Lebanese public. Therefore, even if the organization will be demilitarized in accordance with UNSC Resolution 1559, it is still likely to retain its source of strength among the public.

• The Reut Institute contends that Israel needs to weigh whether to demand that the regional security arrangement in southern Lebanon will include one of the following three demands:

• • Blocking of international aid funds from Iran to the organization;
  • Civil (not only military) redeployment of Lebanon in its southern region in order to supply the full range of government services;
  • Inclusion of the social framework of the Hizbullah in the state institutions, so that it will be subject to budgetary and political control.

Israel can and should take advantage of international opinion in order to manage a campaign of blockage of Hizbullah funds in coordination with international actors. Similar coordinated international campaigns against the Hamas and al-Qaeda have had relative success.

Sources

• Tsvi Barel, Ha’aretz, 26/7/06, Full text.
• Matthew Levitt, The Washington Institute for Near East Policy, 1/3/05, Full text.
• Matthew Levitt, "The Washington Institute for Near East Policy, 1/3/05, Full text.