Oxford Business Group says siege can generate long-term positives for Qatar
The illegal siege of Qatar, which began on June 5, is now in its sixth month. However, during this time, the country has succeeded in finding alternate means to sustain itself.
With the government enhancing its efforts to diversify and improve self-reliance, the siege on Qatar is going to generate a series of long-term positives, said Oxford Business Group (OBG).
“Qatar’s economy maintained steady growth throughout 2017, with forecasts of a stronger year to come as efforts to boost self-sufficiency in key sectors gain traction,” the OBG report said, according to Qatar Tribune.
OBG’s 2017 review of the country lists areas where Qatar has turned the risks of the blockade into benefits.
“Given the regional tensions that arose in mid-2017, there were some hurdles to overcome. The year 2017 has been something of an adjustment, as the country faces this new reality. Preparation and planning taking place now will generate a strong rebound across the entire economy in 2018,” said Standard Chartered Qatar’s CEO Abdulla Bukhowa.
Some of the measures implemented to boost self-sufficiency include investments in the domestic production of dairy, meat and poultry products, as well as food processing and light industry.
One example was seen through the decision to purchase 14,000 cows and construct a dairy farm to address the country’s reliance on imports. The move is expected to make Qatar self-sufficient I milk by mid-2018.
Despite the external headwinds, Qatar remained a regional leader in terms of economic expansion. The economy is forecast to expand by 2.5% in 2017 and 3.1% in 2018, according to the latest IMF estimates.
This is higher than growth estimates for the Middle East as a whole, which the IMF predicts will expand by 1.3% this year and 2.8% in 2018.
Similarly, prompt action by the government forestalled any instability in the financial services sector, with the transfer of funds — much of which came from the Qatar Investment Authority — easing concerns of a liquidity crisis.
The requirement for such transfers eased as local lenders moved to secure funds from banks in Asia and Europe, rather than regional sources. Confidence in the banking sector has seen deposit levels at commercial banks rise after a mid-year dip.
The total deposits stood at QR794.3bn at the end of October, up from the QR736bn recorded in January.
The year 2017 also saw Qatar increasing its energy output. In April, the government announced it was lifting a 2005 moratorium on further development of its main gas reserve, the North Field, part of a programme aimed at lifting annual gas output to 100m tonnes by 2024, up from the 78.7m tonnes posted last year.
