Blockades and Lockdowns
Updated: Jun 18, 2020
Three years ago during this time, Qatar was facing a humongous crisis. It was called out as a supporter of terrorism by Saudi Arabia, the United Arab Emirates, Bahrain and Egypt. They believed that Qatar was getting too friendly with Iran and this didn’t rank well with their political aspirations.
You see, Saudi Arabia and Iran are both Muslim majority countries with a state religion. But Saudi Muslims are majorly Sunni Muslims while Iranian Muslims are Shia Muslims. Both these sects of Islam call themselves the better one. But the story gets political because Iran considers itself to be the supreme power in the Muslim world and Saudi feels threatened by this. So both these countries try to establish their Theo-political supremacy via such proxy wars.
So Qatar was locked down, long before us. Trade ties were cut and no diplomatic relations remained between Saudi Arabia, the United Arab Emirates, Bahrain and Egypt. All transport was stopped with restrictions on all – land, air and water transport. The condition was pitiable. Qatar went on saying that it never had intentions of supporting terrorism or the Iranian. They even maintain that there was no legal justification for this harsh move and simply called it racial discrimination.
But the relations between Qatar and Saudi, the leader of the dispute failed to improve.
Qatar was in a state of shock. It was an economy which imported 90% of its food. Qatari citizens were given 14 days to move back from Saudi, UAE and Bahrain to their own territories. In addition, Saudi Arabia, the UAE, Bahrain and Egypt closed their airspace to Qatari aircrafts and said foreign airlines would have to seek permission for overflights to and from Qatar. Qatar's stock market lost about 10%, or about $15bn (£12bn), in market value over the first four weeks of the crisis.
But Qatar was resilient and rebounded.
Qatar first focused on food security taking the help of Baldana who used innovative solutions to convert the arid landscape into fruitful agricultural land. No longer under the influence of Saudi and the GCC, Qatar worked to build its own international standing. It then bolstered its economic activities and gave companies motives to operate here. Qatar has a legal environment based on English common law, the right to trade in any currency, 100 per cent foreign ownership, 100 per cent repatriation of profits and a 10 per cent corporate tax on locally sourced profits. This enticed many companies to set shop in Qatar and the number of companies operating in Qatar increased by 66% in the first year.
"Economic performance improved in 2018. Qatar's economy has successfully absorbed the shocks from the 2014-16 drop in hydrocarbon prices and the 2017 diplomatic rift," the International Monetary Fund (IMF) said in a statement.
Ironically, the blockade which was supposed to crumble Qatar and make them submit to Saudi’s demands is what made Qatar a player on the international front, independent of the GCC and an alternate power in the Middle East.
It was this blockade that helped Qatar fare better than others during the Covid-19 lockdown. It helped Qatar achieve self-sufficiency in food production and transport. Even the supply chains across Qatar which faced the blockade find the Covid Lockdown a breeze. Qatar has used the blockade as an opportunity to diversify and expand local production where possible, which has increased its resilience and will try to do the same this time as well. The Qatari government noted the country will be one of the few in the world to run a fiscal surplus in 2020.
With the three year anniversary of the GCC-Qatar blockade, there is yet another reason for Saudi to not try and be a regional autocrat.
P.S: Qatar did indeed provide assistance to Islamist groups designated as terrorist organizations by some of its neighbours, notably the Muslim Brotherhood and the Hamas movement. But even Saudi supported hardline Islamist rebels fighting Bashar al-Assad in Syria. What Qatar insists on is that it does not have links to the al-Qaeda-linked alliance, Hayat Tahrir al-Sham.