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Has Qatar made the most of its blockade-inspired wake-up call?

26 October 2018
Charlie Corbett

Ahead of the Euromoney Qatar Conference on the 9th and 10th December, Charlie Corbett takes a look at what has changed in Qatar since we last visited – at the height of the diplomatic furore over the blockade – and what the future holds.


Fact of the day: Since June 2017 Qatar has imported 17,000 cows. That’s almost enough to fill one of the nation’s new football stadiums. And we thought it had enough natural gas already.  Bad jokes aside, this is an astonishing statistic – especially when you think all these cows had to be flown in via Qatar Air. Quite literally, cattle class.

This great bovine migration began just weeks after Saudi Arabia, United Arab Emirates, Bahrain and Egypt cut trade and transport links in June 2017 – and it is all part of finance minister Ali Shareef Al-Emadi’s drive to make Qatar agriculturally self-sufficient. In fact, when it comes to milk and fresh poultry products, they achieved this feat back in June. According to Qatar’s ministry for municipality and environment, the production of dairy products has increased by 265% since the blockade began. Impressive stuff.

But what about all the other parts of Qatar’s society and economy? Just how well has the country fared in the 18 months since the embargo began? Let’s judge Mr. Emadi by his own words. Here’s what he said at our event in Doha last year: “We said we would support the economy and we will make sure the government intervenes where necessary to defend what needs to be defended … We’ve been stress tested on all levels: the banks, the economy, food ….” But how successful has he been? Let’s break this down:

The banks: While non-resident deposits at commercial banks fell by 47bn riyals ($13bn) in the six months after the blockade began, and a total of $30bn leaked from the system as a whole, the Qatari banking system has held up well. Support from the government steered it through the initial crisis and, as of June this year, $10bn in foreign funding had returned, according to Fitch.

The economy: Real GDP grew by 1.6% in 2017, and Fitch expects a pick-up to 2.3% for 2018.The fiscal deficit has narrowed sharply and we expect it to turn into a surplus in 2019. The economy has reconfigured its supply chains and continues to grow at a robust pace. There has been no escalation of measures against Qatar,” Fitch said. A rising oil price and record demand for LNG can only add grist to Qatar’s economic mill.

Food: All those cows have, of course, made a difference on the dairy front – which makes the country, according to the government, self-sufficient in dairy. As for the country’s wider drive towards self-sufficiency and diversification, the embargo has speeded up Mr Emadi’s reform programme. He’s made it easier to do business in Qatar and created a more welcoming environment for foreign investors.

Looking ahead, the blockade appears no closer to a resolution which, according to Fitch, leaves Qatar vulnerable to regional geopolitical shocks. However, despite these underlying concerns, the outlook for Qatar looks strong. It has survived the embargo with its economy and banking system intact. Just what is the next step? Find out at the Euromoney Qatar Conference on 9th/10th December. We look forward to seeing you there.

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