(Bloomberg) -- Lebanon lawmakers elected army commander Joseph Aoun as the country’s first president in more than two years, picking a US-backed candidate in a sign of Iran’s waning influence in the region.
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More than two-thirds of politicians voted for Aoun. His win ends a lengthy power vacuum and represents a pivot by Beirut toward the West, with Tehran-backed militant group Hezbollah weakened by last year’s bruising conflict with Israel.
Lebanon’s dollar bonds, which the government defaulted on in 2020, extended their big rally of recent weeks.
Aoun, who turns 61 on Friday, has led the army since 2017 and will be responsible for the daunting task of maintaining a fragile truce between Israel and Hezbollah while working on reforms to resolve a crippling economic crisis. First, he must name a prime minister who can help him shape the nation’s future after years of crises and isolation, typified by the default on more than $30 billion of Eurobonds five years ago.
Those notes traded at the highest level since October 2021 on Thursday, accounting for some of the biggest gains among emerging-market peers, though they’re still far into distressed territory. The country’s debt has handed investors a return of around 16% since the start of 2025, the best in the asset class, after a 114% rally last year.
“Joseph Aoun will be able to implement the ceasefire agreement and UN Resolution 1701, two important steps toward building a state that will gain the trust of the international community,” said Najat Aoun Saliba, an independent member of parliament, referring to November’s Israel-Hezbollah accord and a 2006 agreement to maintain peace between the two sides.
“By securing the borders of Lebanon and regaining the trust in the public institutions, Lebanon can be put on the path of recovery with the help of the supporting countries like Saudi Arabia,” Saliba said.
Israel severely weakened Hezbollah during an intense offensive by air and land lasting more than two months, killing the US-designated terrorist group’s longstanding leader, Hassan Nasrallah, and depleting its weapons stockpile. That limited the ability of the organization, which is also a political party that holds significant sway in parliament, from sabotaging the electoral process.