Transcript: Where does the ceasefire leave Hizbollah?

This is an audio transcript of the FT News Briefing podcast episode: ‘Where does the ceasefire leave Hizbollah?’

Mischa Frankl-Duval
Good morning from the Financial Times. Today is Monday, December 2nd, and this is your FT News Briefing.

Kasia Broussalian
Hundreds of US attorneys at big government agencies are dusting off their resumes. And while Hizbollah has been hit hard in its war with Israel, the group has staying power. Plus, this was supposed to be a great year for Airbus, but supply chain issues are tripping it up. 

Sylvia Pfeifer
Both Airbus and Boeing have been suffering from shortages of engines, aircraft interiors, seats, landing gears . . . 

Kasia Broussalian
I’m Kasia Broussalian, and here’s the news you need to start your day.

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US government lawyers are scrambling for jobs at corporate law firms. That’s because they’re expecting major cuts to their federal agencies once US president-elect Donald Trump takes office. Leaders of major law firms told the FT they’ve received hundreds of applicants from places like the Department of Justice and the Federal Trade Commission. Now, it’s worth noting that this trend is pretty typical whenever the White House changes hands. But this year’s turn is bigger than usual, and it even includes career civil servants. Staffers are now expecting that whole teams will be cut.

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Where does the ceasefire with Israel leave Hizbollah? That’s the question many in Lebanon are asking themselves as they head home after months of Israeli bombing. The militant group has called the truce a victory, but it’s struggling. Villages in southern Lebanon have been devastated, and the same goes for Hizbollah’s leadership. I’m joined now by the FT’s Raya Jalabi in Beirut. Hey, Raya. 

Raya Jalabi
Hi. 

Kasia Broussalian
So tell me about the situation in Lebanon in the days since the ceasefire deal. Just how well is the truce holding? 

Raya Jalabi
The truce appears to be holding, but there have been reports of multiple violations since it came into effect last Wednesday at 4am. We’ve seen air strikes by Israeli forces both in southern Lebanon below the boundary of what the ceasefire dictates and also above it. There are multiple concerns in Lebanon about these ongoing violations. They also have been documented instances of skirmishes at the border. We’ve seen Israeli forces reportedly firing at residents who’ve been attempting to come home. That specific to the sort of band along the border. You’ve got about 60 villages around there that residents have been trying to return to, but some of those still have Israeli forces in them, and they’ve been warning residents not to come back. 

Kasia Broussalian
So a fragile peace, at least for the moment. Now, I’m curious what sort of power Hizbollah still has. How much is left of its military capabilities? 

Raya Jalabi
It’s a complicated picture because we’re not entirely sure of what Hizbollah’s capabilities are at this moment. We know that they have been able to survive militarily and operationally in the South throughout the last few months, even though their military leadership and senior leadership in the organisation, including the 30-year veteran chief Hassan Nasrallah, they were decimated earlier in the conflict. So analysts and experts who have watched Hizbollah for years say that they have been able to retain some kind of military operational capabilities in the south. But the question is what does that really mean when a lot of the organisation itself has been decimated from a command and control perspective? 

Kasia Broussalian
And beyond its fighting capabilities, to what extent has Hizbollah been able to maintain its support on the ground? 

Raya Jalabi
Now we’ve been able to observe some kind of reorganisation in the last few days. I’ve been on a road trip in southern Lebanon and we have seen a presence of Hizbollah organisations in the areas where residents have been recently returning to. And that sort of demonstrates the complexity of the ceasefire arrangement because Hizbollah not only is a militant organisation but has a sprawling network of social welfare services, we’re talking education, so schools and hospitals and medical facilities. And so those officers and those operatives who work for those sort of civil institutions are still present in Lebanon. You know, amongst its base, it still has a lot of support. It commands a lot of respect. And the way they frame it is that Hizbollah is managing to resist an opponent that had a much more sophisticated military and came out on top. 

Kasia Broussalian
OK, so it sounds like the group is maybe battered but not defeated. 

Raya Jalabi
Well, ever since the ceasefire came into effect, Hizbollah has been going around talking about a victory. And it’s a narrative that they’ve pushed forward amongst their entire population. But the truth is, if you look around Lebanon, it doesn’t look like much of a victory. And people across the country will tell you, our country has been completely devastated. Our lives have been upended. How is this a victory? Now, many analysts and Lebanon watchers will tell you that what Hizbollah signed last Wednesday was effectively a surrender or a complete capitulation to Israeli terms. And that’s because Israel has insisted that it retain the right to militarily enforce any agreement that comes into effect. And what we’ve seen in the last few days is that what that means is that Israel will continue to fire on Lebanon, be it through air strikes, drone strikes or artillery shells, anytime it sees anything it doesn’t like. So overall, I mean, I think the group still commands tremendous support and respect, but it definitely has taken a battering both physically by Israel, but also by its domestic opponents and people inside Lebanon who are not fans of anything they’ve done. 

Kasia Broussalian
Raya Jalabi is the Middle East correspondent. Thanks, Raya. 

Raya Jalabi
Thank you. 

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Kasia Broussalian
Across the border from Lebanon, in Syria, efforts are under way to suppress a rebel uprising. President Bashar al-Assad and his backers have increased attacks on a rebel group that over-ran much of Aleppo in the last few days. The group said that its fighters were also pushing into towns and neighbouring areas. The assault is the biggest in years in Syria’s ongoing civil war and it comes at a time that supporters of Assad’s regime, namely Russia, Iran and Hizbollah, have all been busy with their own conflicts. The rebel group’s ability to move deeper into Syria has dramatically exposed the instability in the country.

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Airbus started out the year on a pretty good note. It had ended 2023 with a record number of new plane orders. And its biggest competitor, Boeing, just had a door plug blow out mid-flight. It was the perfect moment for the world’s largest aeroplane maker to cement its lead. But then everything went kind of sideways. Here to tell me why is my colleague Sylvia Pfeifer. Hey, Sylvia. 

Sylvia Pfeifer
Hello. 

Kasia Broussalian
So give me a lay of the land as it stands for Airbus. What position is the company in right now? 

Sylvia Pfeifer
So Airbus is in the middle of a sprint to get deliveries of aircraft to its customers. It’s set itself a target to deliver around 770 commercial jets by the end of December of 2024 and it is racing to get to this target. It has to deliver around another 200 to get to its stated goal. And that is quite a steep order.

Kasia Broussalian
And so is this kind of a problem maybe of overselling, but potentially underdelivering? 

Sylvia Pfeifer
I think you could say that Airbus was probably a little bit too over-optimistic in June. They had to cut their annual profit forecast for 2024, and they also had to cut the year-end delivery target. And those warnings wiped more than €12bn off the company’s market cap the day after the announcement. So I think what’s happened is that everybody has probably overestimated the state or the health of the industry’s supply chain, which is still not as productive as it was pre-Covid in 2019. 

Kasia Broussalian
Yeah. So tell me a little bit more about the supply chain issues that they’re facing. I guess what’s really snarling it up? 

Sylvia Pfeifer
So the challenges in the supply chain are really across the board and a lot of the problems come or stem from when the industry was pretty much grounded because of the pandemic. So both Airbus and Boeing have been suffering from shortages of engines, aircraft interiors, seats, landing gears, different components. So those sort of shortages are across the board. On top of that, you’ve also had a labour shortage coming out of Covid. Both Airbus and Boeing lost a lot of experienced people during the pandemic and they’ve both been trying to recruit people back. But a lot of people that they’ve recruited are not experienced, and it does take a lot of time to build up that expertise as to how to build an aeroplane. 

Kasia Broussalian
Now, we’ve talked a lot on the show before about how Boeing is facing just massive problems over the last couple of years. How are Boeing’s problems really affecting Airbus? 

Sylvia Pfeifer
The industry’s supply chain is incredibly interconnected. So if Boeing suppliers have a problem, then they are probably also likely a supplier to Airbus. So Airbus in a sense sometimes is being asked to act as a sort of white knight to help some of the suppliers. At the same time, both Boeing and Airbus also share customers. So some of the airline customers that have lost out because of the Boeing problems have gone to Airbus and sort of said, can you help us? And Airbus has had to turn around and say, actually, we can’t because we’re sold out to the end of the decade if you want one of our popular short-haul jets. I think that’s one of the sort of issues for Airbus at a time when its main competitor is struggling and is so weak and hasn’t been able to capitalise on this skyrocketing demand from the airlines because of these constraints in the supply chain. 

Kasia Broussalian
And what might be the repercussions that we’re looking at here for the aerospace industry more broadly? I mean, the two heavyweight companies, Airbus to some extent, but Boeing definitely, are struggling. So what’s the impact of that? 

Sylvia Pfeifer
I think the big lesson from all this is that everybody overestimated the health of the supply chain coming out of Covid. So building all this back will take time. And then in the meantime, one of the consequences is that airlines are having to fly older aircraft for longer while they wait for these new planes to arrive. I think the silver lining for the industry is that everybody needs Airbus and Boeing and they need two healthy plane makers. So it’s in everybody’s interest for them both to succeed. 

Kasia Broussalian
Sylvia Pfeifer is the FT’s industry correspondent. Thanks, Sylvia. 

Sylvia Pfeifer
Thank you. 

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Kasia Broussalian
And finally, it looks like the incumbents in Ireland will be teaming up to lead again. Results show that the two major governing parties Fianna Fáil and Fine Gael are on track to come in first and second in the recent elections. But it’s still not clear if they’ll have enough seats to form a government on their own. And for listeners curious about the fate of a notorious crime boss that we profiled last week, there’s an update. Gerry Hutch got pretty close to winning his seat in Dublin. He attracted a lot of support from the inner city, but he ultimately ended up losing after a nail-biting count.

You can read more on all of these stories for free when you click the links in our show notes. This has been your daily FT News Briefing. Make sure you check back tomorrow for the latest business news. 

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