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Counting Qatar’s economic losses following snapping of diplomatic ties

Published: Updated:

The decision taken by Saudi Arabia, the UAE, Bahrain and Egypt to cut diplomatic relations with Qatar has caused major economic crises for Doha in terms of air and land transport. The decision is bound to have major repercussions for vital sectors of the country’s economy, especially trade and commerce.

The four countries will close both sea and land outlets stopping movements in and out of Qatar and will prevent the transit of all incoming and outgoing Qatari transportations.

EXPLAINER: Reasons why Saudi Arabia, UAE, Bahrain and Egypt severed ties with Qatar

Qatar Airlines, which is the country’s main economic hub, will have to fly longer trips to Africa, which is certain to undermine its operational model and cause longer flight durations for transit passengers.

The overland trade will also be halted completely as a result of the decision. Saudi Arabia and the UAE are among the most important trading partners of Qatar, which highlights the significance of both these countries in maintaining food supplies.

Food supplies

According to the 2015 data, the two countries are ranked first and second in terms of food exporters to Qatar with a total of $310 million. In livestock trade, Saudi Arabia comes first in terms of exports and the UAE is the fifth with the total exports amounting to $416 million.

In vegetable trade, the UAE is ranked second while Saudi Arabia is fourth in terms of exports, with a total value of $178 million annually.

In terms of fuel, Bahrain ranks first as exporter of Qatari supplies while the UAE comes in the second place. The total value is estimated to be about $200 million. In minerals, the UAE is at the top of Qatar’s exporting countries with total of more than half a billion dollars annually.

With the suspension of land trade, Qatar’s plan to host the 2022 World Cup will encounter major obstacles owing to the country’s dependence on Saudi land borders that ensure huge building equipment needed for various project.

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