Updated: July 13, 2017 4:12:38 pm
It’s been more than a month to the crisis that has dogged Qatar, with several Arab countries swooping down on the tiny oil-and-gas rich Gulf state with new economic and diplomatic sanctions over its alleged support for terrorism and ties with Iran. But it seems Qatar, at least in some cases, claims to have measures in place to insulate itself from the sanctions imposed by several big Arab nations including Saudi Arabia, United Arab Emirates and Bahrain.
Early in June, powerful neighbouring Arab nations of Saudi Arabia, United Arab Emirates, Bahrain and Egypt moved to sever diplomatic and economic ties with Qatar by shutting off shipping routes and air space over Doha’s alleged support for terrorism across the region, and its ties with Iran. Qatar, however, denies supporting Islamic extremism and has widely condemned the isolation as clear attack on its sovereignty. Also Read: Top United States diplomat to return to Qatar for talks with emir
The neighbours then issued a 13-point list of demands for Doha to comply with in order to restore erstwhile relations. Some demands include Qatar closing down news outlets such as Al-Jazeera, sever ties with radical Islamist groups like Muslim Brotherhood, scaled down ties with Shia-majority Iran and removing Turkish troops stationed in the country.
Besides the obvious sanctions, the isolation of Qatar by its Arab neighbours has also exposed faultlines running under the surface of the Gulf Cooperation Council (GCC), a regional body of Arab nations instituted to serve as a counterbalance to Iran. The key countries in the council such as Bahrain, Qatar, Saudi Arabia and the United Arab Emirates have refused to back down from their respective positions, a move that has increasingly called into questions the councils’ unity. Recently, Qatar has even threatened to pull out of the GCC if its isolation continues. Also Read: Qatar, US sign agreement on boosting counterterrorism
Even as international community tries its best to restore normalcy in the relationship between the Gulf countries, Qatar is pulling out all stops to weather the crisis.
This is Qatar weathering Arab sanctions:
Qatar claims to have money
In a sweeping statement to allay apprehensions, Qatar’s Central Bank Governor Sheikh Abdullah Bin Saoud al-Thani had said last month to news agency CNBC that Qatar has at least $340 billion in reserves, which includes holdings of its sovereign wealth to help weather the isolation by its Arab neighbours. He was quoted by the news agency as saying: “This is the credibility of our system, we have enough cash to preserve any…kind of shock.”
Al-Thani further said the central bank has $40 billion in reserves plus gold, while the Qatar Investment Authority has $300 billion in reserves that it could liquidate. The Central Bank Governor added while they have noticed fund outflows from some non-residents, the amounts weren’t particularly significant. In a separate statement, Al-thani said there’s more coming in, adding that inflows are exceeding outflows. Besides, over the years, Qatar’s sovereign wealth fund has invested strategically in global luxury brands and real estate in thriving cities like London and New York.
Qatar also has a population of around 2 million, out of which a little more than quarter million are its citizens, which essentially means that the government has a lot of money that it can distribute around.
Qatar gets help from Turkey, Iran, Germany
Shortly after the Qatar crisis began, a Twitter account by the name of #DohaUnderSiege started trending and closely documenting life after sanctions. Here, users posted pictures showing how the economic sanctions had little or no effect on Qatar’s food supplies.
Have readied the escape yacht. This Turkish milk is for the birds… #DohaUnderSiege
— DohaUnderSiege (@DohaUnderSiege) June 11, 2017
One tongue-in-cheek post on twitter had a picture of a supermarket with well-stocked eggs with the user saying: “omelette for dinner again!!! Whoever said there is an egg shortage was eggactly wrong!”
Another post read: “Finally out of fresh milk. Junior will have to eat his cereals with Veuve-Cliquot as of tomorrow”, essentially indicating that Qatar is very wealthy still.
Meanwhile, Qatar is getting its share of food supplies from countries like Iran, Morocco, Turkey. Shortly after the crisis started, Iran had sent four cargo planes well-stocked with food to Qatar and intended to send 100 tonnes of fruits and vegetables every day. Before the crisis, Qatar was importing at least 80 per cent of its food supplies from its Arab neighbours before they severed ties with the nation. Very recently, Qatar also received a herd of cows airlifted from Hungary to boost milk supplies. The cows were the first of 4,000 cattle to be imported by August. Their arrival was also seen as a sign of defiance by Qatar as it continues to resist the isolation.
Turkey, on its part, sent earlier last month around 4,000 tonnes of dry food supplies, fruit and vegetables from its port in western Turkey’s Izmir province. One can also see Qatar’s supermarket shelves stocked with Turkish milk and food supplies instead of Saudi Arabia’s Almarai brand. One Twitter user had posted early in June that while consumers had a hard time deciphering Turkish products, so Doha has gone a step ahead and given translation guides for them.
Qatar’s main source of revenue is natural gas because of which it is possibly wading through rough waters with ease. It is also the world’s largest liquefied natural gas (LNG) producer. For instance, there’s an undersea gas pipeline that supplies gas to the UAE and Oman despite choppy ties. So far its supplies have continued interrupted. For Qatar, natural gas is a resource they can leverage if the crisis escalates. This would have an impact on countries that rely on their gas supplies on Qatar and may find themselves in a position to side with the nation. Experts say that while the costs of goods and commodities have increased for the government given that the older trading routes have been blocked, the expense is yet to be passed onto shoppers.
New trade routes
After the blockade was announced, Qatar launched five new shipping routes to circumvent the trade blockade: Two to India, Two to Oman, and one to Turkey. Qatar’s new Hamad Port’s director Abdelaziz Nasser Al-Yafei had in a statement to Al-Jazeera said that the port its operating at “full capacity”. The facility, which began cargo operations in October last year, was up and running by early December 2016.
Besides, the news agency also quoted the official as saying that Hamad Port received nearly 212 ships in June that came with at least 24,000 containers, 61,000 livestock, 4,300 cars, and at least 6,400 tons of construction materials.
While the month-old crisis shows little signs of easing, it remains to be seen what other measures Qatar puts in place to insulate itself from the sanctions.
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