Middle East bond sell-off widens on Saudi, Lebanese tensions

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By Marc Jones and Davide Barbuscia LONDON/DUBAI  (Reuters) - A sell-off in Middle Eastern bond markets escalated on Wednesday with debt prices in Saudi Arabia, Bahrain and Lebanon all touching long-term lows following Saudi Arabia’s anti-graft purge and government turmoil in Lebanon. Some of Saudi Arabia and Bahrain’s dollar-denominated bonds fell to their lowest since January, while a number of Lebanon’s slumped to their lowest point since being issued as the turbulence spread. This came as sources told Reuters that Saudi authorities had made further arrests in a swoop on alleged corruption among the kingdom’s political and business elite ordered by Crown Prince Mohammed bin Salman.

In the space of two years, the new Saudi leadership has sacked two crown princes, embarked on a military campaign in Yemen, blockaded fellow Gulf state Qatar and rolled back some of its onerous social restrictions. But 16 months ago, the kingdom also presented an ambitious reform plan to diversify its economy away from oil. Saudi international bonds were particularly hit at the long-end of the curve, where foreign investors concentrate their holdings. When Saudi Arabia issued its latest $12.5 billion international bonds in September, the largest debt sale across emerging markets this year, almost half the notes were taken by American buyers with another $3.2 billion by European investors. A Saudi $6.5 billion dollar bond maturing in 2046 fell a cent to the lowest since March at 97.493 cents, while the $4.5 billion 2047 bond was down more than one cent to a one-month low. . Shorter-dated issues maturing 2023 and 2026 fell by around 0.3-0.4 cent too , according to Thomson Reuters data. “It is just all the uncertainty,” Aberdeen Standard Investment’s Kevin Daly said.

“We don’t have visibility, whether that is Saudi policy or ... who is going to be the next prime minister in Lebanon.” Lebanon has been thrust back to the centre of regional rivalry between Saudi Arabia and Iran since the Saudi-allied Lebanese politician Saad al-Hariri quit as prime minister on Saturday, blaming Iran and Hezbollah in his resignation speech. Saudi Arabia in turn has accused Lebanon of declaring war against it because of alleged aggression by the Iran-backed Lebanese Shi‘ite group Hezbollah, a dramatic escalation of a crisis that may destabilise the tiny Arab country. Lebanon’s June 2020 bond dropped 2.6 cents to 95.3 cents in the dollar, the lowest since the bond was issued in June 2013 according to Reuters data. Its April 2020 issue also fell to its lowest ever level as it dropped 2.4 cents to 94.9 cents in the dollar. Lebanese bond yields widened the most on the short end of the country’s debt curve, an indication that short-term political risk was pushing some investors to sell the paper.

“If you think of the yield as being the measure of risk, in the past, as is usually the case, short-dated Lebanese debt was seen as less risky than longer dated paper. Now, the curve is flat – it’s all equally risky,” said Carmen Altenkirch, emerging market sovereign analyst at Axa Investment Managers. “Yields could come down, if a new prime minister is found quickly and the government can get back to business, but this doesn’t appear to be likely in the short term.” Bahrain’s bonds were caught in the cross-currents too and the cost of insuring exposure and against a default in all of the countries involved was on the rise. The cost of insuring exposure to Lebanese and Saudi Arabian debt hit the highest since late 2008 and July this year, respectively. Lebanon, which was thrown back into political limbo by the resignation of Saudi-backed Prime Minister Saad al-Hariri, saw its five-year credit default swaps (CDS) jump 13 basis points (bps) from Tuesday’s close to 592 bps. Rating agency Moody’s warned on Tuesday that reopening Lebanon’s political vacuum would damage its credit rating. Saudi Arabia’s five-year CDS meanwhile hit 100 basis points, its highest since late July. (Reporting by Marc Jones in London, Davide Barbuscia in Dubai, Lisa Barrington in Beirut, Claire Milhench and Karin Strohecker in London; editing by Mark Heinrich)

Saudi Crown Prince’s Unprecedented Power Grab Could Come To Haunt Him

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by James M. Dorsey, Contributor S. Rajaratnam School of International Studies, Senior fellow - Huffington Post

Saudi Crown Prince Mohammed bin Salman has won the first round of what could prove to be an unprecedented power grab that comes to haunt him. The prince’s frontal assault on significant segments of the kingdom’s elite; assertions of unrest in the military and the national guard, and a flood of rumours, including allegations that a prominent member of the ruling family, Prince Abdul Aziz bin Fahd, died under mysterious circumstances suggest however that the struggle may be far from over. There is little doubt that Prince Mohammed is in firm control for now. However, there is also little doubt that many in the kingdom’s elite are licking their wounds and that the crown prince believes that bold action, crackdowns and repression is his best way of ensuring that he retains increasingly absolute power. Criticism and potential opposition ranges from those that feel shut out of the corridors of power to those who see their vested interests threatened by Prince Mohammed’s reforms and actions and/or are critical of the war in Yemen, his putting limits on ultra-conservative social codes, and his power-hungry, autocratic style. As a result, the rumours about Prince Abdul Aziz, even if they may well prove to be incorrect, take on added significance. Prince Abdul Aziz is a son of late King Fahd, a major shareholder in Middle East Broadcasting Company (MBC) that operates the Al Arabiya television network, whose other major shareholder, Waleed bin Ibrahim al-Ibrahim, a brother-in-law of the king, was among those detained this weekend.

Prince Abdul Aziz was known to be a supporter of the former crown prince, Prince Mohammed bin Nayef, who was forced out of office earlier this year after rumours were floated that he had a drug addiction. Prince Mohammed is believed to have been under house arrest since. Prince Abdul Aziz was also a partner in Saudi Oger, the troubled company of the family of former Lebanese Prime Minister Saad Hariri, who resigned this weekend in a seemingly Saudi-engineered move to destabilize Lebanon and confront Hezbollah, the Iranian-backed Lebanese Shiite Muslim militia. Prince Abdul Aziz has an alleged track record of going to the extreme in confronting his opponents. In an unprecedented move, Prince Turki bin Sultan, another member of the ruling family, filed a court case in Geneva in 2015 accusing Prince Abdul Aziz of orchestrating his abduction, sedation and forcible repatriation from Switzerland in 2003. A reformist, Prince Turki said he was kidnapped after he had accused the defence and interior ministries of corruption and planned to organize a seminar to detail the misconduct. Sifting through the rumours and assessing the balance of power in Saudi Arabia amounts to the equivalent of Kremlinology, the phrase used at the time of the Soviet Union to try to decipher the inner workings of the Kremlin. Nonetheless, what is confirmed as fact as well as the rumours appear to bolster suggestions that Prince Mohammed’s crackdown and power grab targeted among others factions of the ruling family related to late kings Abdullah and Fahd as well as the family of the powerful late interior minister and crown prince Nayef bin Abdulaziz al-Saud, Prince Mohammed bin Nayef’s father. What is certainly also true is that Prince Mohamed bin Salman’s crackdown on corruption strikes a popular cord among many in the kingdom who have long resented the awarding of often inflated mega contracts to members of the family as well as alleged land grabs by princes. Countering corruption beyond targeting potential critics and opponents has however a darker side in a country in which until the late 1950s members of the ruling families could access public funds for private use.

This week’s publication by the International Consortium of Investigative Journalists (ICIJ) of the Paradise Papers, exposing the secret dealings and offshore interests of the global elite, potentially puts another member of ruling family in Prince Mohammed’s firing line. Former deputy defense minister Prince Khalid bin Sultan bin Abdulaziz, known as the father of Saudi missiles for his secret procurement in the late 1980s of Chinese missiles for the kingdom, and command alongside US General Norman Schwarzkopf of the US-led alliance that forced Iraq in 1991 to retreat from its occupation of Kuwait, was the only Saudi whose offshore dealings were revealed by the massive leak of documents of the Bermudan branch of offshore law firm Appleby. The documents showed that Prince Khalid was a beneficiary of two trusts and registered at least eight companies in Bermuda between 1989 and 2014, some of which were used to own yachts and aircraft. Several of those dismissed or detained in Prince Mohammed’s most recent crackdown were last year named in a similar leak known as the Panama Papers because they came from a law firm in the country. They include former Riyadh governor Prince Turki bin Abdullah bin Abdulaziz al-Saud, whose oil-services company PetroSaudi was linked to Malaysia’s multi-billion dollar 1MDB scandal; Prince Turki bin Nasser bin Abdulaziz al-Saud, a former military commander and head of the kingdom’s meteorological and environmental authority; former deputy defense minister Prince Fahad bin Abdullah bin Mohammed; and former Saudi Telecom chief Saoud al-Daweesh.

The Panama Papers identified tens of Saudi nationals, including several members of the Bin Salman branch of the ruling family. The leaks included wealthy persons from across the globe with offshore assets, a legal practice that implies no wrongdoing. The military and the national guard, a 100,000-man praetorian guard that was the long-standing preserve of King Abdullah and his closest associates, have remained silent in the wake of this weekend’s arrest of guard commander Prince Mutaib bin Abdullah, a son of King Abdullah, and dismissal of navy commander Vice Admiral Abdullah bin Sultan bin Mohammed Al-Sultan, believed to be a son the late former defense minister and crown prince, Prince Sultan bin Abdulaziz Al Saud. The changes in command nonetheless have reverberated through the ranks. “Things may well quiet down but many in the guard and the navy don’t like the way things were managed,” said a well-placed source. The source’s assessment was echoed by former CIA official and Saudi expert Bruce Riedel. Following a tweet by US President Donald J. Trump in support of Prince Mohammed bin Salman’s crackdown, Mr. Riedel noted that “the Trump administration has tied the United States to the impetuous young crown prince of Saudi Arabia and seems to be quite oblivious to the dangers. But they are growing every day.”

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'Time not right to challenge Hizballah,' says Sisi as Riyadh accuses Lebanon of declaring war

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by alaraby.co.uk Egypt's president has urged for calm in the region as tensions between Saudi Arabia and Iran flare, saying it is not the right time to challenge Lebanese Shia group Hizballah. Abdel Fattah al-Sisi made the appeal in an interview with CNBC over the weekend that aired on Tuesday morning. "The stability of the region is very important and we all have to protect it... I am talking to all the parties in the region to preserve it," Sisi said. When asked whether it was time to challenge Hizballah, Sisi said: "It's not about taking on or not taking on, it's about the status of the fragile stability in the region in light of the unrest." The Egyptian president's remarks come as Saudi Arabia said that Lebanon had declared war against the kingdom. "We will treat the government of Lebanon as a government declaring war on Saudi Arabia due to the aggression of Hizballah," Saudi Gulf affairs minister Thamer al-Sabhan told Al Arabiya TV on Monday He added that Saad al-Hariri, who announced his resignation as Lebanon's prime minister on Saturday from Riyadh, would not accept the positions of Iran-backed Hizballah. Saudi Arabia and Iran traded fierce accusations over Yemen on Monday as Riyadh said a rebel missile attack "may amount to an act of war" and Tehran accused its rival of war crimes. Tensions have been rising between Sunni-ruled Saudi Arabia and predominantly Shia Iran, which back opposing sides in wars and power struggles from Yemen to Syria. Relations between Cairo and Riyadh – traditional allies – have warmed recently following a notable downturn last year when Saudi Arabia abruptly suspended oil aid to Egypt just days after Cairo backed a UN Security Council resolution on Syria drafted by Bashar al-Assad's ally Russia. Egypt is a key member of the Saudi-led bloc that in June severed diplomatic and economic ties with Qatar, accusing it of supporting "terrorists" and being too close to Iran. However, Egypt has been reluctant to contribute militarily to the Saudi-led coalition in the war in Yemen and take sides in the civil war in Syria.

Saudi Arabia's King Salman bin Abdulaziz Al Saud meets with former Lebanese Prime Minister Saad al-Hariri in Riyadh, Saudi Arabia November 6, 2017. (Reuters Photo)

Riyadh to treat Lebanese government as declaring war on Saudi Arabia

by By Habib Toumi, Bureau Chief - Gulfnews.com/Manama: Riyadh will never accept to see Lebanon involved in a war on Saudi Arabia, the Saudi State Minister for Arabian Gulf Affairs has said. "We will treat the government of Lebanon as a government declaring war because of Hezbollah militias," Thamer Al Sabhan said. “The Hezbollah militias affect all decisions taken by the Lebanese government,” he told Al Arabiya Television late on Monday. Al Sabhan added that King Salman Bin Abdul Aziz Al Saud had informed Lebanon’s outgoing Prime Minister Saad Hariri of the details of Hezbollah's aggression against Saudi Arabia, pointing out that the Lebanese government should be aware of the dangers of these militias against his country. “Hezbollah militias are involved in every terrorist act threatening Saudi Arabia,” Al Sabhan said.

“Saudi Arabia will use all political and other means to confront the ‘Party of Satan’.” The Lebanese must choose either peace or inclusion under Hezbollah, he added. "We expected the Lebanese government to act and deter Hezbollah," he said, noting that it was up to the Lebanese to determine what would happen with Saudi Arabia. In his statement to the pan-Arab station, Al Sabhan accused Hezbollah of smuggling drugs into Saudi Arabia and of training Saudi youth on terrorism. “Hariri and noble Lebanese will not accept the stances of Hezbollah,” he said, stressing that claims that Hariri was forced to resign were mere lies distract the attention of the Lebanese people. “Lebanon had been hijacked by Iran-backed Hezbollah militias,” Al Sabhan said, On his Twitter account, the Saudi minister posted that “Lebanon following the resignation will never be the same as it was before," "We will not accept that Lebanon is in any way a platform for the launching of terrorism towards our countries. It is up to its leaders to choose whether it is a state of terrorism or a state of peace," he said to his 410,000 followers on the microblogging site. Hariri resigned on Saturday.

Lebanese PM Hariri visits UAE from Saudi Arabia

By Bassem Mroue | AP BEIRUT — In a new twist in the saga of Lebanon’s prime minister who resigned over the weekend from Saudi Arabia, Saad Hariri’s office said he visited the United Arab Emirates briefly on Tuesday for a meeting with a top official before returning to the kingdom. Much is unknown about Hariri’s unexpected resignation, which stunned the Lebanese, threw its government into disarray and prompted a frenzy of speculation. One of the rumors is that Hariri has been under house arrest in Saudi Arabia, or in some way forced to do the Saudis’ bidding. His brief visit to the UAE could appear to dispel that, except that the Gulf federation is a close Saudi ally — the two countries have been spearheading a war in Yemen since 2015 against the country’s Shiite rebels who are backed by Iran. Abu Dhabi’s powerful Crown Prince Mohammed bin Zayed Al Nayhan met Hariri and tweeted a photo, saying they discussed “brotherly ties” and the situation in Lebanon, without elaborating. Hariri’s office also said the two discussed the situation in Lebanon.

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Saudi arrests show crown prince is a risk-taker with a zeal for reform

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by Patrick Wintour Diplomatic editor - The guardian - No one doubted that Crown Prince Mohammed bin Salman was a man in a hurry. But the Saudi royal’s decision to arrest 11 princes, four ministers and dozens of former ministers shows he is a risk-taker on a scale the Middle East has rarely seen. The fact that the billionaire Prince Alwaleed bin Talal, who owns the investment firm Kingdom Holding, was among the wave of late-night arrests (and is thought to be held in the luxurious confines of Riyadh’s Ritz Carlton hotel) suggests MBS, as Salman is known colloquially, is willing to take on the kingdom’s most powerful figures to implement his reforms and consolidate power. In theory, MBS could be in power for a half a century. The question is whether he is showing the maturity and steadiness to use such a lengthy reign to create a viable, modern Saudi Arabia.

The crown prince will say the arrests show his determination to root out corruption, a precondition of a more open economy. But few think the arrests, and related ministerial sackings, are the independent decision of a new corruption body, established just hours before to replace an existing one, rather than part of a wider reshuffle to centralise all security authority under MBS. The speed and unpredictability with which the crown prince acts – the purge was undertaken in great secrecy in the early hours of Sunday morning – is part of a pattern of behaviour unlikely to reassure international investors and interlocutors. After all, MBS effectively seized power in a palace coup in June, ousting his elder cousin Mohammad bin Nayef as heir to the throne and interior minister. Since then, the pace of reform has been breathtaking, and contradictory.

 Women are to be given the right to drive next year, cinemas are to be opened, tourists welcomed and the role of clerics driven back as part of a cultural and social revolution designed to make the secretive kingdom closer to the model of the United Arab Emirates (UAE) and tprepare the economy for life after oil. The prince is launching a huge sale of state assets, and the UK and US are falling over each other to handle the $2tn (£1.52tn) float of Saudi Aramco, which could raise as much as $100bn for Saudi Arabia. This cash is to be used to build a new capitalist megacity, the extraordinary plans for which were unveiled last week. Many of the Saudi businessmen present at the unveiling are now locked up in the Ritz Carlton, with their phones cut off not just from room service, but their lawyers.

MBS has been equally bold in his foreign policy, determined to curb Shia Iran and marginalise Saudi’s Sunni rival Qatar. Saudi has launched an unending and brutal war in Yemen designed to quell the Iranian-backed Houthis. A missile was launched towards Riyadh this weekend in a sign of how the Saudis are struggling to secure a military victory. In June, MBS imposed a politically costly economic boycott on Qatar that has lost it allies in Europe and Washington. This weekend, the Sunni leader in Lebanon, Saad Hariri, under pressure from MBS, quit as prime minister in order to isolate Hezbollah and deepen the conflict with Iran. In addition, the Saudis are trying to force the weakened Syrian opposition to rein back its demands to end the civil war, in what looks like an uneasy alliance with Russia. It is a programme of social, economic and political reform, largely backed by the UAE, that amounts to a revolution in one of the most conservative countries in the world. The test is whether MBS has taken on too much at once. His latest purge is a sign that he knows opposition is gathering, and believes the educated population, liberated by social media, want reforms to go faster, and those holding back change must be ruthlesslyset aside.

 The list of the latest detainees is breathtaking – the equivalent of Theresa May sacking half her cabinet. As well as Prince al-Waleed, the roll call includes the former finance minister Ibrahim al-Assaf, a board member of national oil giant Saudi Aramco; the economy minister Adel Fakieh, who once played a major role in drafting reforms; the former Riyadh governor Prince Turki bin Abdullah; and Khalid al-Tuwaijiri, who headed the royal court under the late King Abdullah. Bakr bin Laden, chairman of the Saudi Binladin construction group, and Alwaleed al-Ibrahim, owner of the MBC television network, were also detained. Stock markets have recovered from the shock of the arrests, and MBS is the last man standing. But the reverberations of Saturday’s night of the long knives may just be starting.

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Saudi-Iran Tension Rattles Lebanese Bonds After PM Resignation

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by saudigazette.com.sa BEIRUT — Lebanon's president stressed that stability is "a red line" after Prime Minister Saad Hariri's shock resignation, Justice Minister Salim Jreissati said on Monday after meeting the president. In a televised speech, Saad Hariri had said he feared an assassination plot against him and blamed Iran along with its Lebanese ally Hezbollah for sowing strife in the Arab world. His resignation stunned Beirut's political establishment, brought down the coalition government and sparked a new political crisis. Lebanese President Michel Aoun convened a meeting with ministers and top security officials at the Baabda palace on Monday to assess the security situation. Aoun told them political leaders had been responsive to calls for calm, strengthening security and national unity, his office said. The president will take no steps regarding the prime minister's resignation before Hariri returns from abroad, the justice minister said at a press conference after the meeting. Aoun said security, economic, financial, and political stability is "a red line", Jreissati said. "The president is waiting for Hariri's return to hear from him personally. This indicates a sovereign vision...and that the resignation must be voluntary in every sense." On Sunday, Bahrain ordered its citizens in Lebanon to "leave immediately." Bahrain's Foreign Ministry said citizens were banned from traveling to Lebanon, as well. Hariri became prime minister in late 2016 in a coalition government that included the Shiite militant group Hezbollah. — Agenci

by Ahmed Feteha - bloomberg.com Lebanese bonds dropped on Monday after Prime Minister Saad al-Hariri unexpectedly resigned in a speech from Saudi Arabia, raising concerns that a renewed confrontation between the kingdom and regional rival Iran could destabilize the country. The yield on Lebanon’s $750 million Eurobonds due 2037 jumped 63 basis points, the most since they were issued in March, according to data compiled by Bloomberg. Shares in Solidere, the property developer founded by Hariri’s late father, plunged 7.6 percent. Hariri announced his resignation from Saudi Arabia on Saturday, blaming Iran and Hezbollah, the militant group backed by the Islamic Republic, for creating a state within a state. Investors could be worried that his decision may be linked to regional and international efforts to curb Iranian influence Lebanon, according to Raza Agha, the London-based chief economist for the Middle East and Africa at VTB Capital Plc. The long-term outlook in Lebanon is less in question, but “Hariri’s resignation, and the blame placed on Iran and Iranian proxies, will up domestic political tensions,” he said.

Hariri, a pro-Saudi politician, stepped down at a time when the Islamic Republic and its allies are widely seen to have won the proxy war against Sunni powers in neighboring Syria. Saudi Arabia and Iran are also on opposite ends of other regional conflicts including in Yemen and Ira Lebanon’s central bank Governor Riad Salameh said on Monday that the crisis was political and not monetary, with no impact on the currency. The resignation comes as Lebanon struggles with a ballooning budget deficit that the International Monetary Fund expects to reach about 10 percent of economic output. The Lebanese economy is also suffering from the impact of the war in neighboring Syria, which cut major trade routes and brought more than 1 million refugees into the country.

'Free Saad Hariri': Lebanese Convinced Saudis Are Holding Former PM, as Conspiracy Theories Circulate

by Al Bawaba - One of the most persistent is that former Lebanese Prime Minister Saad Hariri is being held hostage in Saudi Arabia. That was the story according to al-Akhbar, which has been described by the New York Times as “wholeheartedly supporting Hezbollah.” On Sunday the daily published a full-page image of Hariri on its front cover accompanied by the headline “hostage.”

Al-Akhbar also published a story claiming that Egypt’s President Sisi had speculated Hariri was under house arrest. Hariri had resigned from Riyadh on Saturday, accusing Iran and its Lebanese ally Hezbollah of destabilizing the Arab world. He also cited a threat to his life, saying that the atmosphere was reminiscent of prior to the assassination of his father Rafic in 2005. The former PM, who was born in Saudi Arabia, has not yet returned to Lebanon. On Monday he met with the Saudi King Salman, which was hailed by Lebanese Interior Minister Nohad Machnouk as proof that “rumors” of his detention were untrue.

There were even claims he was inside Riyadh’s Ritz Carlton, where rumors have suggested Saudi princes detained over alleged corruption on Saturday are being held.Posts using the tag seem largely to be tongue-in cheek, however. A new website “http://freesaadhariri.com” has even been launched, hoping to “free Lebanon's Prime Minister Saad Hariri from the Saudi Arabia jails!" It has a counter showing how long he is supposed to have been held captive down to the second.  Journalist with largely pro-Saudi al-Hayat, Joyce Karam, slammed reports of Hariri’s arrest in a series of tweets.

While there is no serious suggestion that he has been kidnapped, it is not just in the press and on social media that speculation about Saudi intervention in the Hariri’s resignation has been rife. On Sunday, Hezbollah leader Hassan Nasrallah said: "It is clear that the resignation was a Saudi decision that was imposed on Prime Minister Hariri.” “It was not his intention, not his wish, and not his decision." Iran’s foreign ministry has also called it a “plot jointly designed by Saudi Arabia and Israel.” Lebanese Justice Minister Salim Jreissati indicated on Monday that President Michel Aoun would await Hariri’s return before accepting his resignation. “The resignation must be voluntary,” he said pointedly Hariri’s resignation effectively brought an end to the coalition government he had led since December 2016, which had included Hezbollah. His shock departure is likely to see in a period of increased instability in Lebanon, one of several sites where Iran and Saudi Arabia vie for influence in the region.

Lebanese president won't accept PM's resignation until he returns: sources

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BEIRUT (Reuters) - Lebanon's president will not accept the resignation of prime minister Saad al-Hariri until he returns to Lebanon, palace sources said on Sunday, delaying for now politically difficult consultations on his successor. Lebanese Army Denies Uncovering Any Plot to Assassinate Hariri.

BEIRUT (Daily Star.com.lb): Hezbollah Secretary-General Sayyed Hasan Nasrallah has urged calm in light of Prime Minister Saad Hariri's resignation Saturday, describing the move as a Saudi decision.

CAIRO, Nov. 5 (Xinhua) -- Egyptian President Abdel-Fattah al-Sisi on Sunday stressed the need to avoid all aspects of tensions and sectarian strife in Lebanon, Presidential Spokesman Ambassador Bassam Radhi said. Sisi's comments came during his meeting with Lebanese Parliament Speaker Nabih Berri, who is participating in the four-day World Youth Forum in Sharm al-Sheikh resort city. The Egyptian president reiterated his rejection of any interference in Lebanon's internal affairs, reiterating Egypt's support for Lebanon in maintaining its security and stability in face of current challenges. He also underlined the importance of reaching agreement among the various Lebanese factions in order to reach a political agreement. On Saturday, Lebanon's Prime Minister Saad Hariri announced his resignation claiming that it stemmed from a "rejection of Iran's political over-extension in the region." He made the announcement in an unexpected move in a televised statement he read from the Saudi capital Riyadh. His "country would be able to overcome political influence exerted by internal and external forces," he said, adding that the "Islamic Republic (of Iran) has a desire to destroy the Arab world and has boasted of its control over the decisions of Arab capitals." "Iran's hand would be cut off," Hariri said, adding that "Lebanon would not play a role in destabilizing the region." He also implicated Lebanese Hezbollah Shiite group in what he views as Iran's race to regional domination.