Gulf Arabs Take Fitful Steps to End Qatar Rift as Iran Looms

(Bloomberg) -- Qatar isn’t currently in talks with the United Arab Emirates over mending a 30-month regional diplomatic and economic rift, Qatari Foreign Minister Mohammed bin Abdulrahman Al Thani said in a Bloomberg TV interview.

Qatar has held discussions with Saudi Arabia, however, and the easing of its earlier impasse with the kingdom has enabled the two neighbors to develop a line of communication, Al Thani said on Saturday in the Qatari capital. He held out the possibility of similar talks in the future with the U.A.E.

“Our conversation right now is with Saudi Arabia, and we think we are going to look at the rest of the issues at a later stage,” said Al Thani, who also serves as deputy prime minister. Qatar doesn’t foresee a date yet for a reconciliation agreement with the Saudis, he said.

Separately, Al Thani said it was too early to say progress has been made during the talks with Saudi Arabia. “What has been achieved was opening channels between us,” he told Doha-based Al Jazeera.

Doha’s isolation from its closest and most powerful Arab neighbors stands in sharp contrast to their historically fraternal relations. The rupture occurred on June 5, 2017, when Saudi Arabia, the U.A.E., Bahrain and Egypt abruptly severed diplomatic and trade ties with Qatar. They accused Doha of bankrolling regional militant groups -- a charge it denies -- and undermining regional attempts to isolate Iran, with whom it shares the world’s largest natural gas field.

Qatar’s suggestion that it can resolve the dispute by talking to Saudi Arabia alone, bypassing the other three boycotting nations, is “a repeat at attempts to split the ranks and evade commitments,” the U.A.E.’s Minister of State for Foreign Affairs Anwar Gargash said on Twitter Saturday.

Qatar, which bucked Saudi regional dominance by maintaining cordial relations with Iran and supporting Islamist political movements, rejected the quartet’s demands to change its policies. The spat defied Kuwaiti and U.S. mediation efforts and soon settled into a stalemate after the boycotting nations failed to inflict the kind of economic damage on gas-rich Qatar that might have brought it to heel.

Dairy Exports

“Our economy did extremely well in the last two years, better than those countries besieging us,” Minister of Commerce and Industry Ali bin Ahmed Al-Kuwari said Saturday at a conference in Doha.

Foreign direct investment in Qatar grew by almost 7% in 2018 and an additional 5% so far this year, reaching 760 billion riyals ($207 billion), Al-Kuwari said. A fifth of all factories currently operating in Qatar opened during the last two years, and while the country used to import most of its dairy products, it’s now an exporter, he said. Even so, he added, “we hope there will be a resolution at some point.”

A Sept. 14 attack on Saudi Arabian oil facilities temporarily knocked out half of the kingdom’s crude production and shattered any illusion that Gulf Arab states could rely on the U.S. to protect them from an external assault. Riyadh and Washington blamed the attack on Iran, which denied involvement. The U.S. refusal to retaliate against Tehran led Gulf nations to reassess Saudi vulnerabilities, and attempts to mend the rift over Qatar intensified.

Speculation that a breakthrough was imminent swirled after Saudi Arabia, the U.A.E. and Bahrain agreed to take part in a regional soccer tournament in Doha earlier this month. Qatar sent its prime minister to an annual gathering of Gulf Arab monarchs in the Saudi capital on Dec. 10, signaling progress in ending their dispute, though not enough for Qatar’s ruler to attend.

The work of the Gulf Cooperation Council, a regional body of Arab states in the Persian Gulf, has been impacted by the long-running crisis, Al Thani told Al Jazeera.

“The GCC must come back together to represent the cornerstone to fruitful dialogue between the Gulf states and Iran,” he added.

©2019 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.