Could boycott force Qatar to end dollar peg?
TRADERS POINT TO PRESSURE ON RIYAL OVER THE PAST MONTH AMID CONTINUING CRISIS
Questions are being raised over Qatar’s ability to defend the riyal’s peg to the US dollar. According to a report by Reuters, the country’s central bank is estimated to have about $30 billion, but given the current levels of spending, the Qatar Investment Authority may need to liquidate some assets.
The QIA has an estimated $300 billion but many of the assets could be hard to sell considering Qatar’s crisis conditions. Pressure on the riyal over the past month caused it to trade as high as 3.81 to the dollar (it is pegged at 3.64), fuelling talk among traders that the sanctions against Qatar might eventually force the peg to be abandoned.
Six principles
Meanwhile, at the United Nations, four Arab countries that cut ties with Qatar urged Doha to commit to six principles on combating extremism and terrorism and negotiate a plan with specific measures to implement them — a step that could pave the way for an early resolution of the crisis.
Saudi Arabia, the UAE, Egypt and Bahrain broke diplomatic relations with Qatar in early June for its support to terrorist and extremist groups.
Saudi Arabia’s UN Ambassador Abdullah Al Mouallimi told a briefing of a group of UN correspondents that the four nations are now committed to the six principles agreed to by their foreign ministers at a meeting in Cairo on July 5, and hope Qatar will support them as well.
The principles include commitments to combat extremism and terrorism, prevent financing and safe havens for such groups, and suspend all acts of provocation and speeches inciting hatred or violence.
Al Mouallimi said the four-nation quartet thinks it “should be easy for the Qataris to accept” the six principles. He stressed that implementation and monitoring must be “essential components,” and “there will be no compromise when it comes to principles.”
But he said both sides can talk about details of “the tactics” and “the tools” to implement them — “and that’s where we can have discussion and compromise.”
Four Arab nations that cut ties with Qatar urged Doha on Tuesday to commit to six principles on combating extremism and terrorism and negotiate a plan with specific measures to implement them — a step that could pave the way for an early resolution of the crisis.
Saudi Arabia, the United Arab Emirates, Egypt and Bahrain broke diplomatic relations with Qatar in early June largely over its support for terrorist and extremist groups. They initially made 13 demands to help achieve a solution to the crisis.
Saudi Arabia’s UN Ambassador Abdullah Al Mouallimi told a briefing for a group of UN correspondents that the four nations are now committed to the six principles agreed to by their foreign ministers at a meeting in Cairo on July 5, and hope that Qatar will support them as well.
The principles include commitments to combat extremism and terrorism, prevent financing and safe havens for such groups, and suspend all acts of provocation and speeches inciting hatred or violence.
Al Mouallimi said the four nations thinks it “should be easy for the Qataris to accept” the six principles. He stressed that implementation and monitoring must be “essential components,” and “there will be no compromise when it comes to principles.”
But he said both sides can talk about details of “the tactics” and “the tools” to implement them — “and that’s where we can have discussion and compromise.”
The Saudi ambassador explained that the initial 13 points included some principles and some tools to achieve compliance. The 13 points, largely perceived as fair demands by Western nations, include calls to crack down on support for extremists and curbing ties with Iran, and tougher-toswallow calls to shut down Al Jazeera television network with its clear slant towards extremist organsations, and kick out troops from Nato member Turkey, which has a base in Qatar.
Al Mouallimi stressed that stopping incitement to violence is essential, but he said closing Al Jazeera might not be necessary. “The important thing is the objective and the principle involved.”
UAE Minister of State for International Cooperation, Reem Ebrahim Al Hashemi, said that all the countries involved have strong relations with the United States “and we believe that the Americans have a very constructive and a very important role to play in hopefully creating a peaceful resolution to this current crisis”.
President Donald Trump has sided strongly with Saudi Arabia and the UAE in the dispute, publicly backing their contention that Qatar is a supporter of terror groups and a destabilising force in the Middle East.
MoU hailed
Secretary of State Rex Tillerson recently concluded several days of shuttle diplomacy and sealed a deal to intensify Qatar’s counter-terrorism efforts. The memorandum of understanding signed by the US and Qatar lays out steps that Qatar can take to bolster its fight against terrorism and address shortfalls in policing terrorism funding.
Al Hashemi called the MOU “an excellent step.”
“We’d like to see more of that,” she said. “We’d like to see stronger measures taken and stronger commitment made to address that.”
Al Hashemi added that “at this stage the ball is in Qatar’s court.” She added: “We’re looking for a serious change in behaviour, serious measures. No more talk.”