The illegal siege has had no impact on Qatar, says Qatar Central Bank chief

The illegal siege imposed on Qatar by neighbouring Arab countries since June 5 has had no impact on its economy in any way, said Qatar Central Bank Governor HE Sheikh Abdulla bin Saoud Al Thani.

The top official said that Qatar’s economy continues to grow at the fastest pace in the entire GCC region, reported Qatar Tribune.

Despite low global crude oil prices and a not so conducive economic environment, Qatar’s economy has been projected to expand at the fastest pace in the region in 2017, he was quoted as saying by Gulf Times.

As per the latest International Monetary Fund report, Qatar’s real GDP growth is projected to grow at 3.1% in 2018, up from 2.5% in 2017. 
The real GDP growth is expected to pick up on account of recovery in global crude oil prices and their positive spillover effects on both hydrocarbon and non-hydrocarbon GDP, Sheikh Abdulla said in an interview with The Euromoney Qatar Conference.
“The economy has shown resilient performance in the post-economic blockade period. Macroeconomic indicators including GDP growth, trade and current account balance and inflation are all in the comfort zone. Exports and imports have shown a stable rise during July-August 2017 and total exports grew at 17.7% in August 2017 over last year.”

“There has been no interruption to our gas exports and we’ve maintained the smooth supply of gas exports to our trading partners,” Sheikh Abdulla said. 

In the non-hydrocarbon sector, the construction sector is expected to drive the growth, offering large opportunities for investment in projects related to the 2022 FIFA World Cup.

Qatar Riyal committed to US Dollar peg

According to Sheikh Abdulla, the QCB is committed to maintaining the stability of the Qatari riyal’s peg to the US dollar, reported Gulf Times.

During the past five months, he said the impact of the weakening US dollar and announcement of the economic blockade on domestic liquidity had been addressed by ‘making available sufficient foreign currency resources and domestic liquidity’ to the banking sector. 

The banking sector has also improved its funding structure since June 2017 and has ample liquidity at present to support credit growth, as well to mitigate any unforeseen capital outflows, he said. 

“I would like to stress that the aggregate of QCB’s international reserves and foreign currency liquidity, which amounts to $35.6bn in end September 2017, provide us the comfort to meet Qatar’s foreign currency-related payment commitments.

Furthermore, including the reserve maintained by the sovereign wealth fund, we’ve around $340bn of international reserves, which allow us to mitigate any pressure on the exchange rate.”