Members' Research Service By / June 10, 2017

Qatar: Rising tension in the Gulf

Written by Beatrix Immenkamp, On 5 June 2017, several Arab nations, including Bahrain, Egypt, Saudi Arabia and the United Arab…

© alexlmx / Fotolia
Written by Beatrix Immenkamp,
Qatar political conflict with Saud Arabia, Egypt, UAE and Bahrain concept. 3D rendering
© alexlmx / Fotolia
On 5 June 2017, several Arab nations, including Bahrain, Egypt, Saudi Arabia and the United Arab Emirates (UAE), simultaneously announced that they were severing ties with Qatar, a fellow member of the Gulf Cooperation Council (GCC). Accusing Qatar of supporting and financing ‘terrorism and extremism’ in the region, the above countries announced that they would halt all land, air and sea traffic with Qatar, expel its diplomats and ask Qatari citizens to leave their territory within 14 days. Oil prices rose initially as markets responded nervously to the worst crisis to involve the GCC since its creation in 1981, but then dropped again. Any escalation in the crisis would likely lead to more sustained increases in oil and gas prices.

The State of Qatar

The State of Qatar is a monarchy ruled by Sheikh Tamim bin Hamad al-Thani, who assumed power in 2013 at the age of 33. Qataris are largely Sunni Muslims, with a small Shi’ite minority. The ruling Al-Thani family follows the same Wahhabi interpretation of Islam as the rulers of Saudi Arabia, though less strictly. Qatar is home to 2.7 million people, 88.4 % of whom are expatriates (2015 estimates). Enormous natural gas resources have turned it into one of the world’s richest nations. The country is a crucial supplier of liquefied natural gas (LNG) to Europe and Asia, having exported 77.2 million tonnes of LNG – a third of global production – in 2016.
The State of Qatar
Source: Financial Times

International relations

A close ally of the USA, Qatar hosts the largest US military base in the Arab Gulf region. It also enjoys cordial relations with Iran, and the two countries jointly control the world’s largest natural gas field, located beneath the Persian Gulf. Doha has used its enormous wealth to build up an impressive property and investment portfolio spanning the globe. However, the country plays a regional role that has at times incensed its Gulf and other Arab neighbours, who consider Doha an ‘irritating regional maverick‘. They cite its (alleged) support for ‘controversial groups’, including rebels in Sudan’s Darfur region, the Taliban in Afghanistan, Hamas in Gaza, al-Qaeda affiliated groups in Syria, the ‘Islamic State’ (ISIL/Da’esh) and the Islamist-led ‘government of national salvation’ in Libya, and its use of the Arabic news channel Al Jazeera as a ‘propaganda tool’. The combined effect of Qatar’s huge energy resources, the reach and influence of its media outlets and its willingness to actively engage with a wide range of geopolitical actors allow it to wield a disproportionate amount of leverage in regional affairs, often at odds with Saudi foreign policy. Moreover, Qatar is accused of fuelling internal dissent in several GCC countries, as well as Egypt. A joint statement by Saudi Arabia, Bahrain, Egypt and the UAE has placed 59 individuals and 12 organisations – either Qatar based or funded by Qatar – on a ‘terror list.

Support for the Muslim Brotherhood

Qatar has been a long-standing supporter of the Muslim Brotherhood, the world’s oldest and largest Islamist movement. The group is labelled a terrorist organisation by Saudi Arabia and the UAE. The Qatari capital, Doha, has been the longstanding home of the brotherhood’s spiritual leader, Sheikh Yusef al-Qaradawi, and is seen as a base for Islamist activists, including Saudi and Emirati nationals. In 2014, Saudi Arabia, the UAE and Bahrain criticised Qatar over its support for the Muslim Brotherhood, leading to a first breakdown in diplomatic relations among GCC members, which they overcame months later. In September 2014, Qatar ordered a small number of leading foreign Muslim Brotherhood figures to leave, but continued to provide financial support for Islamist movements. The Muslim Brotherhood is reported to have asked members to leave Qatar in the wake of the current crisis.

What is Qatar accused of?

On 23 May 2017, the Qatar News Agency (QNA) published a report, according to which, in a speech delivered that day, the Emir of Qatar described Hamas as ‘the legitimate representative of the Palestinian people’ and called Iran ‘a big power in the stabilisation of the region’. The report has since been dismissed as ‘fake news’, but was widely reported and criticised at the time. Qatar was also involved in a recent hostage deal, under which it reportedly paid Islamist groups in Syria – including al-Qaeda affiliates – and Iranian security officials linked to Shi’a militias in Iraq, US$1 billion to secure the release of a Qatari royal hunting party. Both incidents place Qatar on the wrong side of the long-running rivalry between Saudi Arabia and Iran, the two major powers within the Muslim world. Energy politics has also been cited as a potential reason for the dispute.

The Gulf Cooperation Council

The Cooperation Council for the Arab States of the Gulf (GCC) is a regional organisation with six members: the Kingdom of Bahrain, the State of Kuwait, the Sultanate of Oman, the State of Qatar, the Kingdom of Saudi Arabia and the United Arab Emirates. Set up in Riyadh, Saudi Arabia in 1981, this political and economic alliance aims to achieve unity among its members, through enhanced coordination, integration and interconnection.

Saudi Arabia re-asserting itself

During his recent visit to the Middle East and the Gulf region, US President Donald Trump renewed his commitment to alliances with Sunni Arab nations, first and foremost Saudi Arabia, at the expense of Iran, which he denounced as ‘fuelling the fires of sectarian conflict and terror’. Having regained US backing after several years of lukewarm support from the Obama administration, the Saudi leadership is seen as seizing the opportunity to reassert itself as the leader in the region. Aligning Qatar, which has often been diametrically opposed to its powerful neighbour and fellow GCC members, to their stance on Iran, the Muslim Brotherhood, Egypt and Libya, is seen to be a part of the Saudi strategy. However, Saudi Arabia itself has repeatedly been accused by Western nations of financing and supporting radical Islamist groups, including ISIL/Da’esh. An inquiry into revenue streams for extremist groups operating in the UK is thought to focus on Saudi Arabia. The country is also believed to be financing Salafis in Belgium. The Justice Against Sponsors of Terrorism Act (JASTA), adopted in the USA in September 2016, allows families of the victims of the 9/11 attacks to sue Saudi Arabia and seek compensation from its government. Fifteen of the 19 terrorists involved in the 9/11 attacks were Saudi, and allegations persist that Saudi officials aided some of the hijackers ahead of the 2001 attacks.

The implications of the widening rift

Following the lead of Saudi Arabia, Bahrain, Egypt and the United Arab Emirates, the Comoros, Djibouti, Jordan, Libya, the Maldives, Mauritania, Senegal and Yemen have also either cut or downgraded their diplomatic relations with Qatar. Bahrain, Egypt, Libya, Saudi Arabia, UAE and Yemen have recalled their diplomats from Qatar, and Qatari diplomats and citizens have been asked to leave. Qataris have been obliged to find new import routes for food and building materials following the closure of the land border with Saudi Arabia. The national airline, Qatar Airways, has been hit by an airspace ban in the above countries, leading to the cancellation of 10 % of its flights and the rerouting of many others. Oil and gas exports are not expected to be negatively affected in the near future. However, Qatar’s credit rating has suffered, the local stock market has shed nearly 10 % of its value, and there has been a sharp sell-off in the Qatari national currency, the riyal. A prolonged dispute would inevitably weigh on economic growth and fiscal accounts. Doha may concede in the face of political isolation and economic pressure, especially if internal discontent leads to regime change. However, if Saudi Arabia and the UAE raise the stakes further and demand impossible concessions, a longer period of regional instability and tension may ensue. Qatar has also threatened to leave the GCC, and may strengthen its links with Iran and Turkey. Meanwhile, Turkey is preparing to move additional troops to its airbase in Qatar. US President Donald Trump has urged a negotiated solution to the crisis, and has invited the parties to the White House, after having initially backed the clampdown on Qatar. The EU has called for dialogue among the parties to resolve the crisis.

EU relations with the GCC

The GCC is the EU’s fourth largest export market and the EU is the grouping’s biggest trading partner, with trade flows totalling €138.6 billion in 2016. EU exports to the GCC amounted to €100.8 billion last year. EU-GCC trade grew by 53% in the last ten years, with a peak in 2013 – corresponding to the peak in oil prices. An EU-GCC Cooperation Agreement signed in 1988 contained a commitment from both sides to enter into negotiations on a free trade agreement, but progress has been slow.
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