Israel-Hezbollah ceasefire takes effect, civilians head back to south Lebanon

A ceasefire between Israel and Iran-backed group Hezbollah came into effect on Wednesday after both sides accepted an agreement brokered by the U.S. and France, a rare victory for diplomacy in a region shaken by two wars for over a year.

Lebanon’s army, which is tasked with helping make sure the ceasefire holds, said in a statement on Wednesday it was preparing to deploy to the south of the country.

The military also asked that residents of border villages delay returning home until the Israeli military, which has waged war against Hezbollah on several occasions and pushed around six km (4 miles) into Lebanese territory, withdraws.

The agreement, which promises to end a conflict across the Israeli-Lebanese border that has killed thousands of people since it was ignited by the Gaza war last year, is a major achievement for U.S.-led diplomacy in the waning days of President Joe Biden’s administration.

Costs of Israel-Hezbollah conflict

CASUALTIES

At least 3,768 people have been killed in Lebanon and 15,699 wounded since October 2023, according to Lebanon’s health ministry as of Nov. 24. The figures do not differentiate between Hezbollah fighters and civilians. The vast majority of casualties were inflicted after Israel went on the offensive in September.

DESTRUCTION

In Lebanon, the cost of damage to housing is estimated at $2.8 billion, with more than 99,000 housing units partially or fully destroyed, according a World Bank report.

In Beirut’s southern suburb alone, a stronghold of Hezbollah, Israeli strikes have demolished at least 262 buildings, according to the American University Beirut Urban Lab.

The Israeli military has also done extensive damage in villages and towns in the Bekaa Valley and south Lebanon, both areas where Hezbollah holds sway.

The World Bank report estimated damage in agriculture at $124 million, with losses of more than $1.1 billion, driven by lost harvest caused by destruction of crops and livestock and displacement of farmers.

In Israel, Israeli authorities estimate property damage to be at least 1 billion shekels ($273 million), with thousands of homes, farms and businesses damaged or destroyed.

The bulk of the damage in Israel has been inflicted in areas adjacent to the Lebanese border, pummelled by Hezbollah rockets.

DISPLACEMENT

As of Nov. 18, over 886,000 people have been displaced within Lebanon, according to International Organization for Migration (IOM) and United Nations High Commissioner for Refugees (UNHCR). Over 540,000 people have fled Lebanon to Syria since the war started, data by UNHCR showed.

In Israel, some 60,000 people evacuated homes in the north.

ECONOMIC IMPACT

The World Bank gave a preliminary estimate of $8.5 billion in damage and losses to Lebanon in a Nov. 14 report. Lebanon’s real GDP is projected to contract by 5.7% in 2024, compared to a pre-conflict growth estimate of 0.9%.

Driven by the destruction of crops and livestock and the displacement of farmers, especially in the southern regions, the agriculture sector has seen losses exceeding $1.1 billion over the past 12 months. Tourism and hospitality, key contributors to Lebanon’s economy, have been hit hardest, with losses reaching $1.1 billion, according to the World Bank.

For Israel, the conflict with Hezbollah has compounded the economic impact of the war in Gaza, straining public finances.

The budget deficit has surged to approximately 8% of GDP, prompting all three major credit rating agencies to downgrade Israel’s rating this year.

The conflict has also exacerbated supply chain disruptions, driving inflation to 3.5%, above the central bank’s 1-3% target range. In response, the central bank has maintained high interest rates to curb inflation, keeping mortgage rates elevated and adding further pressure on households.

Israel’s economy in the third quarter rebounded somewhat from a weak second quarter, expanding by an annualised 3.8%, according to the government’s preliminary estimate.

Biden said his administration was also pushing for an elusive ceasefire in Gaza and that it was possible that Saudi Arabia and Israel could normalize relations.

Bursts of gunfire could be heard across Lebanon’s capital Beirut after the ceasefire took effect at 0200 GMT. It was not immediately clear if the shooting was celebratory, as gunfire had also been used to alert residents who may have missed evacuation warnings issued by Israel’s military.

Streams of cars carrying people displaced from southern Lebanon by Israeli strikes in recent months began heading back to the area after the ceasefire, according to Reuters witnesses. Other families could be seen returning to the bombed-out southern suburbs of Beirut, carrying Hezbollah flags.

Biden spoke at the White House on Tuesday shortly after Israel’s security cabinet approved the agreement in a 10-1 vote. He said he had spoken to Israeli Prime Minister Benjamin Netanyahu and Lebanon’s caretaker Prime Minister Najib Mikati, and that fighting would end at 4 a.m. local time (0200 GMT).

“This is designed to be a permanent cessation of hostilities,” Biden said. “What is left of Hezbollah and other terrorist organizations will not be allowed to threaten the security of Israel again.”

Israel will gradually withdraw its forces over 60 days as Lebanon’s army takes control of territory near its border with Israel to ensure that Hezbollah does not rebuild its infrastructure there, Biden said.

“Civilians on both sides will soon be able to safely return to their communities,” he said.

IRAN WELCOMES CEASEFIRE

Hezbollah has not formally commented on the ceasefire but senior official Hassan Fadlallah told Lebanon’s Al Jadeed TV that while it supported the extension of the Lebanese state’s authority, the group would emerge from the war stronger.

“Thousands will join the resistance … Disarming the resistance was an Israeli proposal that fell through,” said Fadlallah, who is also a member of Lebanon’s parliament.

Iran, which backs Hezbollah, the Palestinian group Hamas as well as the Houthi rebels that have attacked Israel from Yemen, said it welcomed the ceasefire.

French President Emmanuel Macron said on social-media platform X the deal was “the culmination of efforts undertaken for many months with the Israeli and Lebanese authorities, in close collaboration with the United States.”

Lebanon’s Mikati issued a statement welcoming the deal. Foreign Minister Abdallah Bou Habib said the Lebanese army would have at least 5,000 troops deployed in southern Lebanon as Israeli troops withdrew.

Netanyahu said he was ready to implement a ceasefire but would respond forcefully to any violation by Hezbollah.

He said the ceasefire would allow Israel to focus on the threat from Iran, give the army an opportunity to rest and replenish supplies, and isolate Hamas, the Islamist militant group that triggered war in the region when it attacked Israel from Gaza last year.

‘SET IT BACK DECADES’

“In full coordination with the United States, we retain complete military freedom of action. Should Hezbollah violate the agreement or attempt to rearm, we will strike decisively,” Netanyahu said.

Hezbollah, which is allied to Hamas, was considerably weaker than it had been at the start of the conflict, he added.

“We have set it back decades, eliminated … its top leaders, destroyed most of its rockets and missiles, neutralized thousands of fighters, and obliterated years of terror infrastructure near our border,” he said.

A senior U.S. official, briefing reporters on condition of anonymity, said the U.S. and France would join a mechanism with the UNIFIL peacekeeping force that would work with Lebanon’s army to deter potential violations of the ceasefire. U.S. combat forces would not be deployed, the official said.

In the hours leading up to the ceasefire, hostilities raged as Israel ramped up its campaign of airstrikes in Beirut and other parts of Lebanon, with health authorities reporting at least 18 killed.

The Israeli military said it struck “components of Hezbollah’s financial management and systems” including a money-exchange office. Hezbollah also kept up rocket fire into Israel in the final hours.

Israel’s air force intercepted three launches from Lebanese territory, the military said, in an extensive missile barrage on Tuesday night that led to warning alarms in about 115 settlements.

A poll conducted by Israel’s Channel 12 TV found that 37% of Israelis were in favour of the ceasefire, compared with 32% against.

Opponents to the deal in Israel include opposition leaders and heads of towns near Israel’s border with Lebanon, who want a depopulated buffer zone on Lebanon’s side of the frontier.

Both the Lebanese government and Hezbollah have insisted that a return of displaced civilians to southern Lebanon is a key tenet of the truce.

Israeli Security Minister Itamar Ben-Gvir, a right-wing member of Netanyahu’s government, said on X the agreement did not ensure the return of Israelis to their homes in the country’s north and that the Lebanese army did not have the ability to overcome Hezbollah.

“In order to leave Lebanon, we must have our own security belt,” Ben-Gvir said.