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How Qatar Crisis Impact on its Economy?

Qatar’s dispute with its neighbours could paralyse its economy.
Qatar Exchange Index plunged to 7.3%, erasing nearly 30 billion Qatari riyals market cap and leaving it at its lowest level since mid-2013. Every stock ended the day in the red, GCC financial institutions exited Qatari stocks in their droves, with net sales of 162 million riyals, the most by any class of investor for the day.
Oil prices rose by as much as 1.6 per cent to US$50.74 per barrel in the morning, with the unexpected escalation of tension between Arabian Gulf producers.  It impacted on Qatar riyal exchange index considerably.
Kuwait and Turkey had attempted to mediate a resolution between the Arabian Peninsula and its neighbors, US intervention amounts to a significant rising of the temperature. We expect shortly the Arabian countries uncertainty will ride away.


 Will Qatari Crisis Affect the Economy?

Are you aware about the Qatari Riyal unrest?

Gulf diplomatic rift or the GCC severance has crippled the Qatar economy adversely affecting the Qatari riyal to a great extent. It has been recently reported that Gulf commercial banks have pulled out their support which might force the central bank of Qatar to utilize their reserve to stop the downfall trend of Qatari Riyal. Many countries have in a hushing tone have instructed not to trade with Qatar in Qatari Riyal making it worse for them to thrive in the foreign exchange industry. Credits and other deals with GCC banks have been adversely effected making the situation all the more worse.

Reserves to Uphold Qatari Riyal

Talking about the Qatar reserves, it is the export of liquidified natural gas that has made them combat these crises, upholding the Qatari riyal for so long. But the disruption of trade and capital flows will soon hurt the Qatar's debt due to the steady rise in diplomatic disputes.

Qatari Riyal beyond GCC

Countries outside the GCC unit have also initiated to deny Qatari Riyal as their liaised banks are denying to its acceptance. But some banks of others countries have given their earlier support without any hindrance. Various Qatari Banks have been funded from foreign banks which are sure to be disrupted with this denial of Qatari Riyal at various quarters.  

Oil reserves have become costlier than before affecting the Qatari Riyal considerably.

Banks and Exchange houses are providing their support to such perplexed customers in India, to an extent that enquiries of forex business are pouring in day and night. Many are of the opinion that crisis is soon going to subside though the rift might take longer time to get resolved.

Scene is quite different in the Qatar Banks, where news of special regulations have been sent, where banks have to give reports on transfers and withdrawals on a daily basis in place of their earlier monthly reports. This might be to have a strict monitoring of the outflow, demand and reaction of the market in order to analyse and strategies their next plan of action to combat any sort of crisis that could rise in future. 

7 comments:

  1. Greece is no stranger to unrest and unease. It's a dangerous time this we live in that's for sure. I am pretty sure that Qatar will suffer financially as Greece does though for totally different reasons.

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  2. I didn't even realise it could have such a big effect! Now I know!

    Sophia x http://sophiawhitham.co.uk

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  3. I don't know much about economy, just what i read online or hear at the news. But i know for sure about financial crisis as my country is much affected the last 7-8 years. I just hope that things wont be the worst for all the world around us.

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  4. Wow I never this and how much of an effect it could have.

    Style & Life by Susana - http://www.susanalopessnarey.com

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  5. Never heard of this before, but I'm glad I am learning new things by reading your posts.

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  6. This is such an interesting post! Thanks for sharing :)
    Mika - ashadeofmikachuu.weebly.com

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  7. I am not a fan of brother or sister nation turning against each other beacuse i think the impact wi ll affect the whole region. What happened to Qatar is so unfortunate and it will definately affect its economy and the Qatari livelihood. Hopefully this gets sorted soon

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