A decision by Sunni Muslim leader Saad al-Hariri to step away from Lebanese politics opens the way for Sh'ite Hezbollah to extend its already deep sway over the country, rendering it ever more a bastion of Iranian influence on the Mediterranean.

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Three times prime minister, Hariri declared on Monday he would suspend his role in public life and boycott a general election in May, citing Iranian influence as one of the reasons he saw little hope of positive change.

It opens a new phase in Lebanon's sectarian politics, governed by a system of power-sharing among its many sects, and adds to the uncertainties facing a country suffering a financial meltdown that marks the biggest threat to stability since a 1975-90 civil war.

Hariri's move will accelerate the fragmentation of the Sunni community which his family dominated for 30 years with Saudi support, before Riyadh cut him off, abandoning a Lebanon policy that had cost billions but failed to curb Hezbollah.

Founded by Iran's Revolutionary Guards in 1982 and heavily armed, Hezbollah has long been Lebanon's strongest faction, gradually establishing the country as one of several Arab states where Iran's Shiite Islamist government wields major sway and making Lebanon a theatre of its struggle with Gulf Arab states.

Stronger financially than most in Lebanon, Hezbollah is well positioned to capitalize on Hariri's retreat. A source familiar with Hezbollah's thinking said the group is already eyeing potential gains for its allies in the Sunni community, typically local politicians lacking the national sway of Hariri's party.

But Hezbollah is also wary of new challenges, including the risk that local and regional adversaries will seek to replace Hariri with more hawkish figures who will seek confrontation rather than strike compromises the way he did in recent years.

Hariri's political earthquake is set against the backdrop of an escalation in the wider struggle between Iran and US-allied Gulf Arab states. The Iran-aligned Houthis have launched two rocket attacks on the United Arab Emirates this month.

The UAE belongs to a Saudi-led coalition fighting in Yemen that says Hezbollah is aiding the Houthis.

On Saturday, a Gulf Arab envoy handed the Lebanese government a list of conditions for thawing ties which a Lebanese diplomatic source said included setting a time frame for the implementation an 18-year-old UN resolution that requires Hezbollah's disarmament.

Political sources say the demand was seen in Beirut as an escalation by Gulf states that expelled Lebanese ambassadors in October in a rift over criticism of the Yemen war by a Hezbollah-aligned minister.

The list, described by the Gulf envoy as confidence-building proposals, also echoed Western demands for the election to be held on time.

But with the Sunni political scene in disarray, some analysts expect calls for a postponement.

Many observers believe this would suit all major players apart from Hezbollah's adversaries who include the Christian Lebanese Forces, a Saudi-aligned party which hopes the majority Hezbollah won with its allies in 2018 can be overturned.

"If the big powers in Lebanon including Hezbollah think it is in their interest to delay the elections, they will do so," said Nabil Boumonsef, deputy editor-in-chief at Annahar daily.

If the election happens, the subsequent horse-trading over a new government is likely to be even more difficult than usual.

This uncertainty does not bode well for the chances of government action to tackle the economic crisis.

Hariri's decision has turned an already complicated electoral landscape on its head.

Dozens of parliament's 128 seats will be affected.

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It won't only affect the 20 seats his Future Movement won in 2018, but many more won by other groups in local alliances with Future. There is currently no Sunni with the kind of country-wide network maintained by Hariri, who lost a third of his seats in 2018 but maintained his position as the leading Sunni.

One of his brothers, Bahaa, may run or back candidates, but has yet to announce his plans. Bahaa has criticized Saad over his accommodations with Hezbollah.

Druze politician Walid Jumblatt told Reuters Hariri's step meant "a free hand for Hezbollah and the Iranians."

Hezbollah-allied Sunnis won seats from Future in 2018.

But the situation may not be so clear cut for Hezbollah, designated a terrorist group by the United States.

For while Hariri's early career was defined by confrontation with Hezbollah, culminating in a brief civil war in 2008, he later made compromises that suited the group and its allies.

In his speech on Monday, Hariri said his compromises had avoided civil war.

"I am not so sure how happy Hezbollah is" with Hariri's decision, said Heiko Wimmen of International Crisis Group.

"It is in Hezbollah's interest to have at least the outward appearance of a functioning political system where everyone is involved, including the Sunnis."

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Lebanese fuel prices are expected to double after the state decided Saturday to change the exchange rate used to price petroleum products in a bid to ease crippling shortages that have brought Lebanon to a standstill.

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Amounting to a partial reduction in fuel subsidies, the increase will mean more hardship in a country where poverty levels have soared during a two-year-long financial meltdown that has seen the Lebanese pound depreciate in value by over 90%.

The decision was made at an emergency meeting attended by the president, central bank governor, and other officials over a fuel crisis that has left Lebanon in chaos, paralyzing basic services and sparking daily melees as people scramble for fuel.

The fuel crisis worsened this month when the central bank said it could no longer finance fuel imports at heavily subsidized exchange rates and would switch to market rates. The government objected, refusing to change official selling prices, creating a standoff that left importers in limbo and caused supplies to dry up across the country.

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Lebanon's prime minister-designate Saad al-Hariri has presented a new cabinet proposal to President ichel Aoun and said he was awaiting his response on Thursday in a move that could end nine months of deadlock as the country faces economic collapse.

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Veteran Sunni politician Hariri has presented multiple proposals to Aoun, an ally of Iran-backed Shi'ite group Hezbollah, over the past months, but they have been unable to agree on a list.

"Now is the moment of truth," Hariri, who has been at loggerheads with Aoun over the naming of ministers since he was appointed in October, told reporters on Wednesday after the meeting.

Aoun said in a statement he would study the proposal that contained "new names and a new distribution for portfolios and sects from what was previously agreed" to reach a decision.

The proposal is for 24 specialist technocrat ministers, in line with a French initiative that envisioned a government capable of enacting reforms that could unlock much needed foreign aid to rescue the nation.

The previous proposals have also been for a technocrat team belonging to different sects. It was not immediately clear specifically how the new line-up differed or what would happen if Aoun rejected it.

However, Wednesday's proposal is seen as Hariri's last attempt to form a cabinet as he was widely expected to give up on his efforts after a trip to long-time backer Egypt.

Saudi-owned Al Hadath television reported earlier that Cairo had asked him not to stand down, citing its own sources.Sources in Cairo said Egypt had promised economic and political support for a new government and that a delegation would travel to Beirut soon.

If the cabinet were rejected and Hariri quit, it would leave the country having to seek another Sunni willing to replace him.

Under a sectarian power-sharing system, Lebanon's president must be a Maronite Christian and the prime minister a Sunni Muslim. With less than a year to an anticipated parliamentary election, few figures might be willing to step forward.

Lebanon has been without a government since the last one resigned in the aftermath of the Aug. 4 Beirut port blast that killed more than 200 people, injured thousands of others and destroyed swathes of the city.

The deadlock has deepened the financial crisis, dubbed by the World bank as one of the deepest depressions of modern history.

"For me, this government can start to rescue the country and stop the collapse," Hariri said.

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"There are no people in the Israeli entity, they are all occupiers and settlers," Hezbollah leader Sheikh Hassan Nasrallah said Monday.

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The terrorist leader delivered the remarks at the opening of the "Palestine Emerges Victorious" conference in Lebanon that convened "to renew the media discourse and manage the confrontation with the Zionist regime," according to a report from Iranian news agency Mehr.

Nasrallah also discussed the severe economic crisis in Lebanon that threatens to spill over into massive social unrest, blaming US policy as the "main reason" for the crisis.

"The US bans any aid to solve the crisis in Lebanon. This is to serve the Israeli enemy," he noted.

The country is currently gripped by economic woes, which the World Bank recently estimated could be included among the top-three worst episodes globally since the mid-19^th century.

Caretaker Prime Minister Hassan Diab warned on Tuesday that Lebanon was a few days away from a social explosion.

Nasrallah stressed that the US and Israel could not be separated, saying that "when confronting the Israeli occupation and the American hegemony, we cannot divide this confrontation."

The "Palestine Emerges Victorious" conference is reportedly being held at the Coral Beach Hotel in Beirut.

This article was first published by i24NEWS.

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It's something of a riddle how Arab and Muslim states have dealt with the COVID crisis. In March 2020, when the World Health Organization declared the virus a pandemic, and reports of thousands of cases were pouring in from all over the globe, it was hard to ignore the astonishing data from most Arab states, whose populations number in the tens of millions and generally do not enjoy world-class healthcare systems.

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Other than Iran, which was badly affected by COVID and reported tens of thousands of cases and hundreds of dead, most Arab states supplied only partial numbers that did not reflect how fast the virus was truly spreading within their borders. At first, many refrained from closing their borders or instating restrictions on movement and public gatherings. Still, once the countries that have a centralized regime and a strong centralized government decided on a policy of isolation and lockdowns, it helped stop the spread of the virus, but also did major damage to their economies.

Jordan, for example, completely shut down its air, land, and sea borders from March 14 to the beginning of August 2020. Since then, only people arriving from "green" countries have been allowed into the kingdom, and only if they show proof of a negative COVID test. The Jordanian government also announced a series of actions to prevent gatherings, including scheduled closings and reopenings of schools, business, and public services. Egypt also instates localized closures based on outbreaks.

In countries like Yemen, Libya, Syria, and Iraq, where civil wars are raging and armed militias control part of the territory, and Lebanon – which is on the verge of economic collapse, only a few dozen confirmed cases were reported in the first months of the pandemic. There were questions about their reliability. There was also concern that if the regimes hid the true numbers about the spread of the virus, it would cause the already difficult humanitarian situation in those places to worsen, and cause the healthcare systems, such as they are, to be overwhelmed and unable to provide even a minimum of care.

Still, all the experts with whom Israel Hayom spoke agreed that it would be impossible to secure accurate data from these countries, since other than the WHO and some international volunteer groups, there is no one who can reliably track carriers and their condition.

According to Egyptian anthropologist Dr. Ayman Hajj Yousef, many researchers of Islamic cultures think that the low COVID numbers reported by Arab states are the result of "the strict Islamic lifestyle."

"In states like these, a person who gets COVID might be seen as someone who doesn't have enough faith or as someone who is punished by Allah for a lack of faith or for doing things that go against Islamic values," Yousef says.

Another reason for the low COVID numbers in Arab states is that they have young populations compared to western countries. Arab states see high mortality over age 65 and high birth rates, which means that half their populations are under age 60, and therefore not in high-risk groups.

"Young people who contracted COVID and showed minor symptoms, or had no symptoms at all, don't get tested, for many different reasons," Hajj Yousef explains. "The faulty healthcare system, bad financial situation, or shame, for example. At the start of the pandemic there were assessments that no matter how much [countries] tried to hide the true figures, at a certain stage the extent of the horrors would be exposed and victims would be buried in mass graves, or their bodies would be burned. Or that hospitals would be overwhelmed with cases and collapse. It later turned out that wasn't the case."

"We do know about hospitals in Lebanon, Jordan, Iraq, Syria, and even the Palestinian Authority that were at full capacity, and in eastern Cairo Islamists even set fire to a COVID ICU ward two weeks ago, killing six patients. The people who set the fire wanted to send the message that COVID patients were sinners, and it was a punishment they deserved. But apart from that, we haven't heard about unusual cases in Arab countries," Hajj Yousef observes.

Former head of the IDF's Military Intelligence Directorate Brig. Gen. (res.) Yossi Kuperwasser, now a researcher at the Jerusalem Center for Public Affairs, expresses doubt about the veracity of official COVID numbers reported by Arab countries.

"According to their official figures, most of them have managed to stop the spread of the virus. But you can't forget that these are countries whose official tallies no one really takes seriously, since the real numbers are much bigger than what is officially announced by the authorities," Kuperwasser says.

As COVID continued to spread, a major concern in the West was that the virus could cause a vacuum of power in Arab countries that might bring down regimes and result in extremist entities like al-Qaida or the Islamic State taking over. Other chilling scenarios entailed pro-Iranian Shiite militias gaining footholds in Syria, Lebanon, Yemen, and Iraq, or the return of governments who espoused the views of the Muslim Brotherhood. That didn't happen.

"Nothing really changed there because of COVID," Kuperwasser says. "Most of the countries went on as usual during the pandemic, taking various steps to stop the spread, such as closures. COVID served as material for opposition factors who criticized the regimes, but posed no threat to the regimes themselves. The opposite – I would say that in certain countries, because there was a sense that 'everyone was in it together,' the population united behind the regimes and there was no major criticism. In places where there are internal conflicts, like Syria or Yemen, they continued. So did the protests in Iraq and Lebanon."

Middle East scholar Dr. Michael Barak of the Interdisciplinary Center Herzliya thinks that "COVID held a mirror up to the Arab rulers and showed them that no one is immune to the pandemic, so if they wanted to maintain their regimes' stability, they needed to address the pandemic and find ways to deal with it."

"One of the main concerns that came up was that the pandemic would provide an opportunity for Islamist terrorist organizations, who might take advantage of the fact that all over the world, security forces were busy keeping public order.

"The terrorist groups saw this as a perfect time, because a period of global chaos is the time to step up attacks. COVID gave extremist Islamist terrorist organizations like ISIS, al-Qaida, Hezbollah, etc. 'justification' for the claim that [the pandemic] was the hand of God, a punishment for heretics. For ISIS, it was a godly event that represented God's promise that ISIS would rise again, like a phoenix, and be restored to greatness. We are seeing the organization gain strength in its second-tier areas, like Sinai, Nigeria, and West Africa."

"The Islamist organizations are telling themselves and the world that 'God sent a soldier named COVID,' and the heretics can't fight it. They used the panic over COVID for propaganda, to improve their image. Al-Qaida, for example, whose popularity has been waning since the advent of ISIS and the assassination of Osama bin Laden, used the fear and anxiety in Arab states to disseminate Islamist propaganda."

"The organization put out messages in English and Arabic on the Internet and social media, telling westerners, 'The world is changing, and you in the West should look at yourselves. Why are people in the west being so badly hurt by the pandemic? Look at how you can improve your lifestyles, so that Allah will protect you from COVID. Converting to Islam is the way.'"

Whether COVID was sent by God or not, most Arab states will soon begin vaccinating at-risk populations. Vaccinations will be available to the general population only around the end of March.

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Countries like Iran, Lebanon, Syria, Iraq, Libya, Yemen, and Sudan, as well as the PA, will be receiving large shipments from the international COVAX initiative, of which most nations of the world, including Israel, are members. All member nations commit to contribute part of their own stocks of vaccines to a shared supply earmarked for impoverished nations.  Additional aid from the WHO, UNICEF, the World Bank, international pharmaceutical companies, and philanthropists aims to ensure that each state receives a fair "dose" of vaccines, even if they can't pay for them.

A look at the numbers (as of Friday, Jan. 8)

Palestinian Authority and Gaza 

Population: 4 million 

Cases: 144,257

Deaths: 1,519

"The Palestinians in Judea and Samaria took the fight against COVID a little more seriously than the neighboring Arab states did, because of fear about how the pandemic would impact the economy," Kuperwasser explains.

"On the other hand, every morning they attend huge mass prayer services at Al-Aqsa Mosque and insist on ignoring orders banning public gatherings and hurt their own health and that of their loved ones. Beyond that, they saw COVID as more leverage to slander Israel as being responsible for everything that happens in the world, especially to them," he adds.

Barak: "The situation in Gaza is getting worse from every perspective – humanitarian, medical, economic, and employment. In Gaza there is also a serious problem of addiction to painkillers, especially among the young and unemployed. Because Hamas uses harsh measures against the population, such as isolating confirmed cases in isolation centers in the southern Gaza Strip, where conditions are atrocious … and the isolation is enforced through coercion and threats, we can assume that the Gaza population is becoming bitter. Still, we can't say this is a situation that poses a threat to the Hamas regime."

"COVID has also led to an increase in emigration from Gaza to Europe. At least a few tens of thousands, apparently 40,000-60,000 Palestinians from Gaza, have left, mostly to Turkey or Italy," Barak notes, adding that suicide – particularly among young Gazans – is increasing."

Jordan

Population: 10 million 

Cases: 302,856

Deaths: 3,955

The Jordanian Health Ministry has approved the Pfizer vaccine for use in the kingdom, and Amman has already signed a purchase agreement with the American pharma giant that should secure enough vaccines for its entire population. The vaccines are slated for arrival in February, at which point the government will launch a free vaccination campaign.

Barak: "Even before COVID, Jordan was suffering from a serious social and economic crisis. It has over a million refugees from Syria, which has forced the government to invest in infrastructure and jobs. COVID also led to a drop in funding from Gulf states because the Jordanians feared that the Muslim Brotherhood would start inciting its population.

"The king of Jordan doesn't trust the Muslim Brotherhood – and tensions in the kingdom are growing and will increase further when the vaccination campaign starts, because expectations are that the vaccines will be prioritized and Jordanian Palestinians, the majority, will be vaccinated after the Bedouin minority, which enjoys privileges."

Egypt

Population: 90 million 

Cases: 144,583

Deaths: 7,918

The Treasury in Cairo has signed a deal with China's Sinopharm for 20 million vaccines, and Egyptian media reports that 100,000 have already arrived, but Egypt's medical workers or at-risk population still hasn't started getting jabbed. Egyptian President Abdel Fattah el-Sissi said that the vaccination campaign would likely get under way only in July 2021, without explaining why. However, the UN thinks that because Egypt is home to some 20 million non-citizens, it wants to make sure it has enough vaccines for its own people.

Barak says that most civil society leaders in Egypt have pitched in to help the authorities, including aid agencies, Sunni religious organizations, the Coptic Church, and the military. Their support for el-Sissi's policies, which included lockdowns, keeping back vaccines until the entire population can be vaccinated, and closing down the country's tourism sector despite the economic costs, have bolstered the president's legitimacy.

"The worst crisis in Egypt is the economic one. Even before COVID, Egypt was seeing huge population growth, without solutions for housing or jobs. COVID highlights these problems, especially because tourism has been hit. The healthcare system in Egypt is also in crisis, after COVID exposed its problems. About 250 doctors and other medical staff died after contracting COVID. All this is fertile ground for subversive elements, but at this stage there is still broad support for el-Sissi."

Syria

Population: 17 million 

Cases: 11,890

Deaths: 741

The drawn-out war in Syria and the lack of a functioning central government in Damascus have caused the Syrian Health Ministry to avoid announcing updates about COVID figures.

Barak says the situation in Syria is "very complicated" because the country is breaking apart into areas controlled by different entities, and the government of President Bashar Assad is not functioning.

For now, reports about COVID in Syria are coming from WHO staff stationed in Damascus. Last week, they announced that there was no way of knowing how many vaccines Syria would be getting or when they would arrive. The WHO, UNICEF, and COVAX will be helping Syria bring in enough vaccines for at least 3 million people. But because of the chaos, it appears likely that those vaccines will go to Syrians who work for foreign organizations and companies that will take the lead in ensuring their personnel are vaccinated.

Lebanon 

Population: 7 million

Cases: 199,925

Deaths: 1,550

As they have throughout the pandemic, the Lebanese are still reporting low numbers of confirmed COVID cases, but there is virtually no voluntary testing. The government does not have the funds to procure testing kits or process them.

Lebanon provides its citizens with only basic medical services. But each ethnic group in the country (Sunni Muslims, Shiites, and Christians) has its own healthcare system. The Shiites, supported by Iran and Hezbollah, operate community clinics and hospitals in Shiite villages in southern Lebanon that are funding by Iran. Only Shiite Lebanese are treated. Similar systems operate in the Sunni and Christian communities.

However, the Lebanese government recently announced that it had closed an $18 million deal with Pfizer for 1.5 million vaccines, which are slated to be delivered in February. The vaccines will be administered at no cost. Lebanon has also joined COVAX and is scheduled to receive another 2.2 million vaccines from the program in the third quarter of 2021.

Lebanon also plans to vaccinate the 700,000-strong population of Syrian, Palestinians, Yazidi, Kurdish, and other refugees in Lebanon, although they will be last in line. The number 700,000 is what Lebanon's Health Ministry is quoting, although according to UN estimates, the country's refugee population actually numbers 1.5 to 2 million.

Barak: "Hezbollah will try to take advantage of COVID and present itself as caring about national interests. The organization is trying to position itself as a national entity and obscure its involvement in the Syrian civil war."

Iran

Population: 81 million

Cases: 1,261,903

Deaths: 55,830

Iran is the only country in the Middle East to report worrying morbidity and mortality numbers from the start of the crisis. The Islamic Republic is currently in the midst of a third wave of coronavirus, and the harsh US sanctions on the Iranian regime are not helping it stop the spread.

Iran's central bank has announced that the WHO and COVAX have helped it obtain 16.8 million vaccines, paid for by Iranian assets frozen in South Korea. Some of the money will go to Pfizer to pay for a few million vaccines. The Iranians are also trying to negotiate with Moderna and AstraZeneca. Iran needs 120 million doses to vaccinate its entire population, but due to sanctions banks are unwilling to process the payments.

Meanwhile, Iran plans to use vaccines developed by Russia and China. According to Kuperwasser, at the beginning of the pandemic, Iran was one of the only countries in the world to keep its borders open to flights from China, which contributed to the spread of the virus.

"When it comes to strategic issues, like the question of the nuclear deal, which is back on the table, the Iranians expect the Chinese to be on their side, partly because of how they behaved during COVID. It's another reason for them to buy the Chinese vaccine, beside its relatively low cost compared to the vaccines developed in the west."

Iran expects to start vaccinating its people soon, although no date has been set. Once underway, the project is likely to take a few months.

Meanwhile, Iran's Health Ministry announced two weeks ago that first-stage clinical trials on a locally-developed vaccine had concluded. Head of the development project, whose daughter was one of the 56 volunteers in the first trial, said the vaccine was expected to be 90% effective.

Morocco

Population: 36 million 

Cases: 447,081

Deaths: 7,618

Morocco has purchases 10 million vaccines from China's Sinopharm, which are expected to arrive shortly, and the country expects to begin vaccinating as soon as possible.

Saudi Arabia 

Population: 34 million 

Cases: 363,377

6,272

Saudi Arabia recently approved the Pfizer vaccine and purchases millions of vials. According to Saudi media reports, 90% of the vaccines acquired are from Pfizer, with the rest from Moderna, AstraZeneca, Sinopharm, and the Russians.

The vaccines began arriving in December.

Throughout the pandemic, the Saudis took comparatively harsh steps to curb the spread of the virus, like closing the holy cities Mecca and Media for the Haj pilgrimage – an unprecedented step. The closure is expected to remain in effect for Ramadan 2021, which begins on April 12.

Kuperwasser: "That step did not significantly harm the government's stability. Of course, a lot of religious people didn't like it, but everyone understood that in conditions like these, the pilgrimage wasn't a realistic prospect, and despite the tensions between the various streams of Islam like the Shiites and the Sunnis, all religious leaders backed the decision."

Barak says the Saudis are eager to see an end to the crisis, among other reasons, because of the drop in oil prices, which has bitten into the kingdom's profits and salaries it pays to state employees, causing resentment. However, because Saudis are not allowed to demonstrate against the royal family, criticism is mostly being voiced on social media.

"Because of the economic crisis and the drop in oil profits, even before COVID, the Saudis are starting to enter new markets, like airlines and tourism … and developing solar energy and [other] alternative energy initiatives," he says.

Meanwhile, residents of the Persian Gulf countries Bahrain, the United Arab Emirates, Qatar, Oman, and Kuwait who had the bad luck to contract COVID received first-rate medical treatment.

Bahrain was the first country in the world to start vaccinating its citizens, even before Israel. While Bahrain is keeping its exact numbers under wraps, its healthcare authorities reported that it had acquired "millions" of vaccines from Russia and China, and later on from Pfizer. The same goes for the other Gulf states, which have also begun vaccinating their general populations.

Shahar Klaiman and Dean Shmuel Elmas contributed to this report. 

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Alarmed by a new spike in COVID-19 cases, Prime Minister Benjamin Netanyahu this week ordered a slew of businesses to shut back down and disbanded some children's summer camps, dashing hopes for relief from record 21% unemployment.

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Protesters from across the political spectrum have taken to the streets with demands for speedier compensation from a coalition government they see as overstaffed. Less than half of $29 billion in pledged aid has been paid out.

Israeli police said there had been no sign of violence at protests, but Lapid cautioned that could change.

"We are talking to people who are becoming more and more desperate and angry, who feel, and rightly so, that the country has deserted them at their darkest hour," Lapid said.

"We are trying to be responsible, to calm things down, telling people, 'You know violence is not the answer'," he said.

"But it's getting harder by the day. I sympathize with the anger and I also worry about the possibility of violence as a result of this anger. What I am trying to do is not to encourage it but to raise a red flag as to what might happen."

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The country is in political and economic turmoil after three weeks of nationwide protests that prompted Prime Minister Saad al-Hariri to resign last week.

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"The time has come to meet the people's demands and the national free will that transcends sects, political parties, and regions," Grand Mufti Sheikh Abdul Latif Derian said in a televised address on the occasion of Prophet Mohammed's birthday.

"The time has come and is opportune, after this national wake-up call, for the reform process to begin and for those in power to form an emergency government made up of competent people, without delay," Derian said.

It is time "to immediately proceed with carrying out the reform package prepared by Prime Minister Hariri to solve the country's problems", he added.

Maronite Patriarch Bechara Boutros Al-Rai, Lebanon's top Christian religious authority, has also called for a change in government to include qualified technocrats.

Before he stepped down, Hariri agreed to a package of reforms with partners in the coalition government aimed at easing an economic crisis that sparked the unprecedented protests against the sectarian ruling elite.

The plans included a 50% reduction in the salaries of current and former officials and $3.3 billion in contributions from banks to achieve a "near-zero deficit" for the 2020 budget.

But Lebanese politicians have yet to make progress towards agreeing on a new government to replace one that was toppled.

The country's power-sharing system is based on 18 recognized religious sects and dates back to French colonial rule. It allocates posts for each of the country's communities, forming the basis of its major political parties and creating a delicate balance between Christians, Sunni and Shiite Muslims and other groups.

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Lebanon has been swept by more than a week of nationwide protests against a political elite accused of corruption, mismanagement of the state finances and leading the country toward an economic collapse unseen since the 1975-1990 civil war.

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A report from credit rating agency S&P was the latest to sound the alarm over the financial situation. Banks remain closed and have said they will only reopen when life returns to normal.

Hezbollah leader Hassan Nasrallah, whose organization is part of Prime Minister Saad Hariri's coalition government, urged his followers to stay away from the protests after they clashed with demonstrators in Beirut.

The heavily armed Shiite group is widely seen as the most powerful player in Lebanon and is part of an Iranian-led regional alliance that is in conflict with US-allied Gulf Arab states that have political allies in the country, and Israel.

Nasrallah praised the protest movement for forcing the government to agree on a state budget without new taxes and "unprecedented" reforms including draft laws to lift banking secrecy, recover looted wealth and fight corruption.

But he also said the demonstrations that began spontaneously had been exploited by regional and international foes.

He reiterated Hezbollah's rejection of the resignation of the Hariri government and any move to topple Hezbollah's Christian ally, President Michel Aoun, saying this would leave a void.

"In view of the difficult financial, economic and living situation in the country, in view of security and political tensions that are prevailing in the region ... a vacuum will lead to chaos, to collapse," Nasrallah said.

He said if Lebanon remained shut down by the protests, people including the army would not get their wages and the country would be plunged into complete chaos.

"I am afraid that there are those who want to take our country and generate social, security and political tensions and to take it to civil war," Nasrallah said.

"God willing nothing like this will happen ... but I tell you there is information and doubts about this matter."

The protests took a more violent turn on Friday when groups supporting Hezbollah pushed into a peaceful demonstration in Beirut, scuffling with protesters and forcing riot police to intervene.

Dressed in black T-shirts common to Hezbollah supporters, the men shouted "We heed your call, Nasrallah."

Several protesters were injured in the scuffles, witnesses said.

After Nasrallah spoke, Hezbollah supporters waving the group's yellow flag took to the streets of the southern suburbs of Beirut, the group's stronghold.

"They're trying to scare us with war. But they are the generation of war, we are an educated generation and know how to get along with one another," said physiotherapist Bilal al Baba, 28, demonstrating in central Beirut.

Another protester, Maria, said Nasrallah's speech encouraged her and her friends to come back out to protest. "The entire country was paralyzed waiting for what he had to say," she said.

Nasrallah urged protesters to accept Aoun's invitation for dialogue. Aoun has suggested a cabinet reshuffle was on the table.

Banking fears

Credit rating agency Standard & Poor's said the government's limited ability to address the demonstrators' demands could harm confidence in the banks and adversely affect foreign exchange reserves.

Lebanon's banking association has held crisis meetings with the central bank governor and president in recent days in search of a way to reopen banks amid growing fears that a rush on them could deplete dwindling foreign currency deposits.

"Right now we're using the pretext of the demonstrations not to open. We are afraid that when we open people will rush to withdraw their money or transfer it abroad," said one senior banker.

He said banks were seeking a common policy to meet the needs of customers and the central bank governor has so far avoided capital controls that would likely stop expatriates from sending remittances.

As politicians ponder ways out, financial strains are mounting in Lebanon, one of the world's most heavily indebted states.

Capital inflows needed to finance the state deficit and pay for imports have been slowing down, generating financial pressures not seen in decades, including the emergence of a black market for dollars.

While the central bank's foreign currency reserves were enough to service government debt in the near term, risks to government creditworthiness have risen, S&P said.

Lebanon's central bank governor and finance minister could not immediately be reached for comment on the S&P report.

There has so far been no financial support from countries which have in the past aided Lebanon, such as Western and Gulf Arab countries.

The European Union said it supports Hariri's reforms and is committed to Lebanon and its stability.

"We are confident that the authorities will respond swiftly and wisely to legitimate aspirations of the Lebanese people," the EU statement said.

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Lebanon's highest Christian Maronite authority and a prominent Druze politician threw their weight behind the groundswell for change, calling for qualified technocrats to be included in any government shake-up.

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With a population of 6 million people including around 1 million Syrian refugees, Lebanon has been swept by protests against politicians blamed for corruption and waste in a state mired in debt and economic crisis.

Flag-waving protesters kept roads blocked with vehicles and makeshift barricades for a seventh day on Wednesday. Banks have been closed since Friday and will remain shut on Thursday, the banking association said. Schools are also closed.

Soldiers scuffled with demonstrators as they struggled to unblock main roads.

"We're staying in the streets until the looted public funds are restored, until the government falls," said Heba Haidar, protesting at a makeshift barricade of empty trash containers and steel rods in Beirut.

Prime Minister Saad Hariri's government announced an emergency reform package on Monday, to try to assuage public anger and steer the state away from a looming financial crisis.

Hariri's government, which took office at the start of the year, groups nearly all of the main parties in a sectarian power-sharing system.

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The Lebanese economy is collapsing. First came the war in neighboring Syria, which shattered several major economic sectors, such as trade and tourism, and saw millions of Syrians seek refuge in Lebanon, something that has taken a toll on the country's fragile economy.

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Then came the Persian Gulf states' ire over the tighter grip Hezbollah – the Iranian-backed Shiite terrorist group – has been able to get in the country, where it has become a political force that poses the majority in parliament. This has prompted Gulf states to bar their citizens from visiting Lebanon or investing money there.

And if that wasn't bad enough, Lebanon was then hit with US sanctions seeking to stifle Hezbollah financially.

Some causes for the protest are rooted deeper and stem from the younger generation's revulsion of the old, corrupt ways characterizing Lebanese politics, which seem to be governed by a handful of politicians and their families, whose behavior is reminiscent of the Mafia's glory days.

But the protest and unrest will not lead Lebanon anywhere, nor will they breed a new political horizon. As always, Lebanese youth's anger will be outweighed by their loyalty to the older generation's leaders and with it to the familial, tribal, and religious foundations of their society and politics – even if the latter is rotten to the core.

Tribal and sectarian animosities have been poisoning Lebanon for decades, perpetuating its existence as a failed state subject to the whims of corrupt crime bosses.

If there is one thing that always trumps the desire for social justice and better economic policies it is the hatred for and fear of a rival tribe, which repeatedly leads to similar voting patterns.

In Lebanon, it makes little difference whether the government falls, as new elections are unlikely to herald any significant political change.

There was a time when this inherent chaos was the source of Lebanon's strength as it prevented a situation by which the country could fall prey to a dictator and afforded its people relative freedom and a flourishing economy.

But these days have passed, and the reality in which there are no robust state institutions has birthed anarchy and a failed economy.

The mass protests sweeping through Beirut are a thorn in Hassan Nasrallah's side. After 20 years of cultivating growing political power, Hezbollah and Nasrallah are an inextricable part of the system. This means he cannot escape responsibility for the situation or blame others, especially when Hezbollah's activity is one of the main causes of Lebanon's distress.

The organization's contribution to the undermining of state institutions is well known, but the fact that it insists on locking horns not only with Israel but also with the Gulf states and the United States is proving to be an adventure Lebanon is unable to weather.

For this reason, Nasrallah has rallied to Lebanese prime minister Saad Hariri's – his nemesis – side and has called on cooler heads to prevail.

The Lebanese government will most likely survive the current wave of protest, but it will have nothing to offer its agitated people but a bleak future.

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