COMMODITIES FX by Mohammed Zidan Gulf Crisis digested by GCC stock indexes
Te four Gulf Cooperation Council states who announced cutting off diplomatic relations with Qatar - the oil and gas-rich tiny Gulf state - and imposed blockade on this country are justifying their decision by claiming that Qatari is supporting terrorism.
A number of Middle East and Asian countries joined the blockade, the most important of which is Egypt. Consequently, land and marine borders as well as international airspaces of these countries blocked Qatari vehicles and jets, which means that the tiny country is now almost isolated from the rest of the world.
Blockade news raised concerns about food supplies shortage and travel ban
from and to Qatar, and troubles such as crowded food stores and airports started to show up. The diplomatic crisis, which turned into a complete blockade on Qatar, raises further concerns about the future trading and economic cooperation between Qatar and the rest of the GCC states.
Restrictions on freedom of
movement within the council’s states and a financial ban imposed on transactions with Qatar also threaten mutual investments in the blocked country and the states who imposed the blockade, led by Saudi Arabia. In Egypt, for example, the Egyptian Central Bank imposed a complete ban on financial transactions with Qatari banks in and outside Egypt.
Crisis reasons
Qatar is known for its ambitious foreign policy which sometimes makes the tiny state’s decisions undesired by the rest of the GCC states, especially Saudi Arabia. Qatar’s good relationship with Iran - the main rival of Saudi Arabia in the Middle East - is plausibly the main reason for the boycott imposed by the rest of the states, as it represents a threat to Riyadh, the biggest economic and military force among GCC states in the region.
The second and officially
announced reason is that Qatar is accused of supporting regional Islamist groups, including Muslim Brotherhood, which was designated as a terrorist organization group by a
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