Eight months have passed since the Arab boycott to Qatar has started, and the obvious fact is that the Qatari regime is not going to survive if this boycott continues for what it has of a negative impact on Doha’s economy and its role in general. According to specialized economic reports and Qatar Central Bank data, Qatar’s budget deficit in the third quarter of 2017 has increased 12 times comparing with the same period in the previous year, with the budget recording a deficit of 10.5 billion riyals ($ 2.9 billion), compared to 791 million riyals (217.3 million) in the third quarter of 2016. In a comparison between the second and third quarters of last year, the budget deficit showed an increase of 73.6% in the third quarter compared with the second quarter which recorded 6.05 billion riyals in deficit. Thus, deficit in the third quarter represented 6.9% of the 151.7 billion riyals, Qatar’s GDP in that period.
In the same context, the debts of Doha’s government for commercial banks have increased by 29.3 % in 2017 compared to 2016. According to Qatar Central Bank reports, Qatar government’s debts to the commercial banks operating in Qatar have reached 332.1 billion riyals ($ 91 billion) by the end of the last year. Moreover, the total outstanding loans of the Qatari government in 2017 amounted to 175.5 billion riyals ($ 48 billion), compared with 138.6 billion riyals ($ 38 billion) in 2016. The total value of securities; bonds and sukuk, issued by the government and bought by commercial banks, was about 156.5 billion riyals ($ 42.9 billion).
Another impact of the boycott is the dramatic fall of Doha’s financial and economic indicators, which prompted the authorities to withdraw foreign reserves and borrow locally and externally, as well as moving to the bond market in order to ease the pressure on these reserves, especially with the increasing exit of funds and investments from within Qatar.
Politically, the suffering of the Qatari regime has multiplied after the Arab boycott, and there has been ample evidence of Qatar’s support for terrorism, making any country’s rapprochement with it as a charge of supporting terrorism. Therefore, Qatar found no one except Turkey and Iran to resort to in order to break its isolation, which also suffer from regional and international isolation because of their destabilizing policies and undermining security and peace in the region and the world. Doha, however, found that embracing Iran and Erdogan has increased its isolation even more and rather witnessed sharp decline in its economy. Therefore, fearing complete collapse, the Qatari regime began to surrender and comply with the demands of the Arab Quartet by asking the great powers, especially the United States, to mediate in order to resolve the crisis.
This Qatari move towards the United States and asking Trump to intervene and resolve the crisis means that the regime has exhausted all the methods in which it sought to face the international community and that it has become aware that the only solution for the crisis is by complying with the demands of the Arab Quartet, which Qatar is trying to do so now but in a way that might save what remained of its face, after it lost its bet on Iran and Turkey and the help of the Jewish lobby in pressuring the United States to support its positions in the current crisis.
Qatar’s move to the United States came after it became certain that Iran and Turkey cannot even solve their own problems and crises, therefore, how can they help in resolving its crisis! This Qatari move will anger Tehran, the mullahs’ leaders and Erdogan, especially in the current circumstances where Trump’s administration is applying an aggressive strategy against the Iranian regime and its destructive behavior in the region. So, it is highly possible that we are going to witness a very soon end for the honeymoon between Qatar and each of Iran and Turkey.
Al Mezmaah Studies & Research Centre
4 February 2018