Qatar economy weathers Saudi-led blockade: report

DOHA: Qatar’s economy has weathered the impact of a months-long blockade by neighbouring countries, although its tourism and real estate sectors have taken a hit, an economic report said on Wednesday.

The tiny Gulf state’s economy has maintained positive growth in the seven months since Saudi Arabia, United Arab Emirates, Bahrain and Egypt imposed an air and land siege, said the report by Capital Economics.

“Recently-released national accounts data confirmed that Qatar avoided the worst fears that the diplomatic crisis would plunge its economy into recession,” the independent London-based research firm said.

The economy of the gas-rich state grew by 1.9 percent in the third quarter of last year, up from 0.3 percent in the previous quarter, it said.

Growth of the non-hydrocarbon sector, which is more vulnerable to the blockade, remained unchanged at 3.2 percent in the third quarter.

The foreign liabilities of Qatari banks rose in November for the first time in six months, a sign that domestic banks have secured additional financing from foreign banks, it said.

But it added that the tourism sector has been hit hard, with visitor arrivals down 20 percent in November compared to the previous year.

Flights into Qatar were down 25 percent and flights by Qatar Airways were cut 20 percent in the same period.

Capital Economics estimated that tourism receipts between the start of the blockade in June and end of 2017 dropped $600 million compared to the previous year.

Real estate prices also fell by 9.9 percent.

The Saudi-led bloc of countries accuses Qatar of supporting extremist groups and of being too close to Iran, charges Doha denies.