Near the Rosh Hanikra border crossing in northern Israel, shows tractors along a new wall on the Israeli-Lebanese border. AFP
Near the Rosh Hanikra border crossing in northern Israel, shows tractors along a new wall on the Israeli-Lebanese border. AFP
Near the Rosh Hanikra border crossing in northern Israel, shows tractors along a new wall on the Israeli-Lebanese border. AFP
Near the Rosh Hanikra border crossing in northern Israel, shows tractors along a new wall on the Israeli-Lebanese border. AFP

Israeli military to 'expose and thwart' Hezbollah attack tunnels from Lebanon


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The Israeli military has begun excavations to block border tunnels built by Hezbollah that cross into Israel from neighbouring Lebanon.

The pre-dawn operation, dubbed Northern Shield, is being carried out inside Israel near the town of Metula to "expose and thwart" the underground attack routes dug by the Iran-backed political party and militia.

Israel's military said the tunnels were not operational but posed "an imminent threat" to civilians, and constituted "a flagrant and severe violation" of Israeli sovereignty.

The action was launched after Israeli Prime Minister Benjamin Netanyahu met US Secretary of State Michael Pompeo in Brussels on Monday. At the start of that meeting, Mr Netanyahu said they would discuss “how we can together curb Iran’s aggression in the region, in Syria, in Iraq, in Lebanon and elsewhere.”

Israel's Foreign Ministry on Tuesday afternoon instructed all ambassadors to convey the message that the Israeli military's activity on the northern border was defensive and carried out within Israeli territory and not a bid to escalate.

"The construction of attack tunnels is an act of aggression and a violation of UN resolution 1701 by the Iranian proxy in Lebanon," the foreign ministry's spokesman Emmanuel Nahshon said.

UN Security Council Resolution 1701 ended the 34-day 2006 war between Hezbollah and Israel and designated the Lebanese military and UN peacekeeping forces as the sole legitimate armed actors to operate in the area between the Litani River and the UN-demarcated Blue Line.

Danny Danon, Israel's permanent representative to the UN, confirmed the action against the tunnels, and said The United Nations Interim Force in Lebanon (Unifil) and Lebanese armed forces were not doing enough to stop such activity.

"Israel is conducting a limited operation in its territory to neutralise Hezbollah terror tunnels coming from southern Lebanon. This is a clear violation and a wilful disregard of Security Council 1701," he told reporters in New York. "Hezbollah is in control, I would say full control, of southern Lebanon, and uses civilian infrastructure to conduct terror attacks against Israel."

He said video and pictures of the tunnels would be later released by Israel.

In a tweet, the Israeli army confirmed they had located and were destroying a tunnel in the southern region of Kfar Kila: "Tunnel crossing into Israel, but did not pose an immediate threat to local residents".

Unifil sent additional units to the border to monitor the movements and activities of the Israeli forces and was in contact with Lebanese and Israeli officials.

"Unifil is liaising with all relevant interlocutors to ensure that the parties use the Unifil liaison and coordination mechanisms to maintain the continued calm and stability," force spokesperson Malene Jensen told The National. "The situation in Unifil's area of operation remains calm," she said.  The peacekeepers have manned outposts and regular patrols that work along the Blue Line to monitor the situation.

In a statement, the Lebanese army said it was deployed to the area and stood ready to face any threat.

Messages shared on Hezbollah-run Telegram channels cited Israeli reports of the operation and said that the Israeli military feared the force might perceive the operation to clear tunnels as an act of aggression that required escalation.

South Lebanon has experienced the longest period of calm since before the country's 15-year civil war with 12 years of stability since the 2006 war. However, the US and Israel regularly accuse Hezbollah of violating UNSCR 1701 by building military infrastructure in preparation for future conflicts.

Israel also violates the agreement on a near daily basis with thousands of military flights over Lebanon a year, as well as ground and sea units crossing the Lebanese border. Israel also continues to occupy the Shebaa Farms area and Northern Ghajar town despite repeated UN resolutions calling for them to be handed back to Lebanon.

Between July and October this year, Unifil recorded 550 Israeli air violations, totalling 2,057 overflight hours.

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In 2014 alarmed Israeli residents from a small border town set out in search of what they thought were underground passages being dug beneath their homes. Civilians in Zarit said they had told the Israeli military that they had heard drilling under the ground and suspected it was Hezbollah at work, The Times of Israel reported.

Israeli military officials played down the existence of the tunnels and refused to investigate further after sending technical experts to do an initial search, according to residents.

However, the Israeli army and intelligence units said it has long-warned that the neighbouring militia had plans to carry out cross-border raids and has been trying to locate the tunnels for more than four years.

Israeli soldiers standing outside a military vehicle near the border with Lebanon. AFP
Israeli soldiers standing outside a military vehicle near the border with Lebanon. AFP

Israel has also been constructing a large concrete border wall along its side of the Blue Line, which it says say will help prevent Hezbollah cross-border raids such as the July 12 operation that killed three Israeli soldiers and led to the 2006 war.

A core message in many of Nasrallah's speeches is the idea of his force's ability to reciprocate for any attack, warning Israel that if it hits the Rafiq Hariri International Airport then Hezbollah will hit Ben Gurion Airport, if Israel strikes Beirut itself then Hezbollah will hit Tel Aviv.

In addition to a network of tunnels, Hezbollah is believed to have an arsenal of more than 100,000 rockets and missiles.

Since 2006, Hezbollah has acquired what analysts warn could be a strategic leap in experience and equipment following its intervention in the Syrian conflict early on in the war. On the Syrian battlefields, Hezbollah has proved some of the most capable forces and has worked closely with Russian troops.

Israel’s vulnerability to tunnels was laid bare during its war with Palestinian militant group Hamas in Gaza in 2014.

Mr Netanyahu has recently hinted at a coming Israeli offensive, saying: "I will not say ... when we will act and how. I have a clear plan. I know what to do and when to do it. And we will do it."

He said an coming security challenge would require Israelis to "endure sacrifice".

About 121 Israelis were killed in the 2006 war, mostly soldiers, and more than 1,200 Lebanese were killed, mostly civilians.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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