Chinese firms face uncertainty in Qatar
GCC disputes won’t affect trade, investment: expert
Chinese companies that operate in Qatar are scrambling to prepare for uncertainties and potential risks for business in the country and the broader Gulf area, as regional tension rises after a group of countries led by Saudi Arabia severed diplomatic ties with Qatar.
China has maintained positive and stable relations with all parties, with considerable economic and trade involvement in the region. There haven’t yet been any reports of repercussions, but risks such as rising costs and limited access to the region are feared among companies. “There has been no impact on our business in Qatar and elsewhere in the region,” a representative at Chinese construction giant China Gezhouba ( Group) Corp’s branch in Qatar told the Global Times on Wednesday in a phone interview.
The representative, who requested anonymity, said that supplies such as food and construction materials for the company’s projects in Qatar and Kuwait have not been disrupted so far. “Our workers in the region haven’t been affected either,” the representative added. But that’s just for now, and in the long run there are many uncertainties and risks, the person said. That sentiment is shared by companies operating in the region, according to the representative. The Chinese Embassy in Doha convened a meeting of Chinese companies doing business in the country to discuss precautionary measures to avoid risks, the Gezhouba
representative said. “But nobody seems to know what’s happening, so we are closely following the situation,” the person added.
There are a number of Chinese companies with bases in Qatar from which they work on projects in the region. Most of these are in infrastructure construction, including China Sinohydro Corp, China Harbour Engineering Co and China State Construction Engineering Corp. Infrastructure projects have been booming in the region, according to the website of the Chinese Embassy.
None of these companies could be reached for comment as of press time. The Economic and Commercial Counselor’s Office of the Chinese Embassy also did not respond to request for comments.
So far there are no reports of disruption to Chinese businesses in Qatar or in the region. Chinese citizens living in Qatar, mostly as employees of Chinese companies, described an overall calm and peaceful state amid the diplomatic turmoil.
“There has been some rush ( to stock up for daily goods) but the overall situation is controllable,” a Chinese worker living in Qatar, who asked for anonymity, told the Global Times on Wednesday.
Some rushed into supermarkets to stock up groceries, fearing shortages or rising prices, after the Saudi- led group of countries cut ties with Qatar, closing sea, air and land routes into Qatar, he said.
“There is some apprehension among Chinese citizens in Qatar about the situation, but they remain mostly optimistic,” Feng Songtao, a leader of a local Chinese group, told the Global Times. “But if the situation further deteriorates, there will be some people who might decide to leave.”
Chen Fengying, a research fellow at the China Institutes of Contemporary International Relations, said uncertainties and risks exist but they are controllable.
“Companies might face higher costs due to limited access to transport and foreign exchange, but Qatar is not some wartorn country like Yemen. It’s an important international trade and financial center, so it’s unlikely that a war could break out,” Chen told the Global Times Wednesday.
She added that a war or even escalated tension could hurt the interests of countries including the US and even those that severed ties with Qatar.
China is the largest source of imports in Qatar. In the first quarter of 2017, bilateral trade reached $ 590 million, up 43.9 percent year- on- year, with Chinese exports to Qatar standing at $ 350 million, according to the Chinese Embassy.
Chen said that bilateral trade won’t be affected in the short term because most of the deals have already been finalized, but if the tension continues, it might affect signing of new business deals because of transportation problems.
China’s largest maritime shipping company, China COSCO Shipping Corp, declined on Wednesday to comment on the situation, but it did not report any disruption in its transport in the region.
Qatar Airways have canceled flights from China to the countries in the Saudi- led group via Doha, a popular hub for Chinese tourists, and offered tickets refund, according to media reports. Chinese online travel agency Ctrip. com said in a report on Wednesday that the move could affect “thousands” of Chinese tourists.
Chen said that despite some delays, the diplomatic friction in the Gulf region will not derail the China- initiated “Belt and Road” initiative or a free trade agreement that is under negotiation between China and the Gulf Cooperation Council, the sixcountry bloc that includes Saudi Arabia and Qatar.
“China is not involved in the diplomatic disputes, so there is no reason that it will affect China’s cooperation with these countries,” Chen said.
“Nobody seems to know what’s happening, so we are closely following the situation.” Anonymous worker representative at China Gezhouba ( Group) Corp’s branch in Qatar