Goods to Qatar get shipping lane through Oman

Official says economy sound after regional diplomatic rift

DOHA, Qatar — Qatar said Monday that it had begun shipping cargo through Oman to bypass Persian Gulf countries that have cut off sea routes to the tiny, energy-rich nation, the latest move by Doha to show it can survive a diplomatic dispute with its neighbors.

Qatar’s port authority published video showing a container ship loaded with cargo arriving at Doha’s Hamad Port from Oman’s port of Sohar to a water-cannon welcome.

Typically, cargo for Qatar stops at Dubai’s massive deep-water Jebel Ali port or in the Emirati capital of Abu Dhabi, then gets put on smaller boats heading to Doha. But since June 5, the United Arab Emirates has joined Saudi Arabia, Bahrain and Egypt in cutting off sea traffic to Qatar as part of the nations’ severing of diplomatic ties over Qatar’s alleged support of extremists groups and close ties to Iran.

Qatar’s port authority said its cargo will go through Sohar, as well as Oman’s port at Salalah, bypassing the need to dock in any of those countries that have cut ties. Global shipper Maersk already has said it will begin using Salalah for its shipments to Qatar.

Meanwhile, Iran’s state-run Islamic Republic News Agency has said two Iranian navy vessels will soon stop off in Oman as part of an anti-piracy patrol. Oman, not among those countries cutting ties to Qatar, routinely serves as a back-channel negotiator for Western governments needing to speak to Tehran.

Meanwhile, Qatari Finance Minister Ali Shareef Al Emadi insisted Monday that Qatar has enough financial firepower to defend its currency and economy, seeking to downplay the effects of the crisis on the country.

Al Emadi said in an interview broadcast on CNBC that the plunge in Qatari assets last week was a “normal” reaction to the Gulf countries’ move to cut diplomatic and transport links with Qatar.

“We’re business as usual and we’re open for business,” he said.

The measures have prompted investors and economists to ponder how long Qatar, the world’s biggest exporter of liquefied natural gas, can weather the pressure without having to devalue its currency or sell any of its global assets. Qatar’s sovereign wealth fund, one of the world’s largest, controls stakes in companies including Glencore PLC and Barclays PLC.

“Our reserves and investment funds are more than 250 percent of gross domestic product,” said Al Emadi, who sits on the board of the sovereign wealth fund. “I don’t think there is any reason that people need to be concerned about what’s happening or any speculation on the Qatari riyal.”

Ratings companies have been less sanguine about the feud’s effect on Qatar’s economy.

Moody’s Investors Service, for example, said it sees the potential to push up Qatar’s borrowing costs. Qatar’s sovereign credit strength will be hurt primarily on higher funding costs, while a pickup in foreign investment outflows would drain foreign-exchange reserves, it said.

Al Emadi predicted that the countries isolating Qatar will share in the economic pain they’re inflicting on it.

“A lot of people think we’re the only ones to lose in this,” the minister said. “If we’re going to lose a dollar, they will lose a dollar also.”

The diplomatic crisis has seen Arab nations and others cut ties to Qatar, which hosts a U.S. military base and will be the host of the 2022 FIFA World Cup. Doha is a major international travel hub, but flagship carrier Qatar Airways now flies increasingly over Iran and Turkey after being blocked elsewhere in the Middle East.

After an initial run on supermarkets by panicked residents, Qatar has secured dairy products from Turkey. Iran also has shipped in vegetables by air and plans to send some 350 tons of fruit by sea to Qatar, with which it shares a massive offshore natural gas field.

Information for this article was contributed by Malak Harb, Jon Gambrell and Amir Vahdat of The Associated Press and by Zainab Fattah of Bloomberg News.