Monday, June 5, 2017

Qatar Air, Land and Sea Links Closure by Gulf States for 'Terrorism' Links Will Hit Supply Chain

Tough New Punishment Measures as Rift Ensues Amongst Arab Countries
Shipping News Feature
MIDDLE EAST – In a move that could devastate trade and stop vital imports into the country, Saudi Arabia, Egypt, Yemen, Bahrain and the UAE have announced that in response to actions taken by the state of Qatar in 'supporting terrorist activities and groups' they are to withdraw diplomatic staff and cut all air, land and sea communications to the tiny peninsular state. Qatar has responded by stating the action is 'unjustified'. The move is likely to have severe consequences for the country's supply chain, affecting as it does air freight, and road and sea borne cargo.

Qatar, which has world's third largest natural gas reserves plus capacious oil reserves, not to mention the highest per capita income in the world, and despite being engaged in military operations in Yemen against the Houthi militia in cooperation with the Gulf States, has been accused by its former allies of supporting Islamic extremist groups such as the Muslim Brotherhood, Al Qaeda and Daesh (ISIS, ISIL whatever they’re called this week) and of attempting to destabilise its neighbours. Many around the world who proclaim Saudi Arabia is the major financier of current Islamic based terrorism will view the move with a degree of cynicism, but a statement by the Bahraini government said that the decision was due to:

“…the insistence of the State of Qatar to continue to destabilise the security and stability of the Kingdom of Bahrain, to intervene in its affairs, to continue the escalation and incitement of the media, and to support armed terrorist activities, and financing groups associated with Iran to subvert and spread chaos in Bahrain in flagrant violation of all agreements and the principles of international law without regard to values, law, morals, consideration of the principles of good neighbourliness, or commitment to the constants of Gulf relations, and the denial of all previous commitments.”

Saudi Arabia and the other Gulf States have announced that they are closing off their airspace to any Qatari flights, as well as severing sea and land links. This move will effectively cut Qatari Airways, one of the key regional long haul carriers, off from the outside world. Etihad Airways, Emirates and Fly Dubai have said they will be suspending flights from June 6 until further notice. These nations have also given all Qatari citizens two weeks to leave their respective countries.

Of especial concern is the effect that the embargo will have on road haulage. Currently it is thought that 40% of Qatar’s food is trucked in from Saudi Arabia every day. With road communications cut from the Kingdom then the situation could become exceedingly precarious in short order. As Qatar is one of the key global exporters of LNG this spat is liable to engender major problems for many countries as the gas is of ever increasing importance as fuel around the world in various industries, including the carriage of sea freight.

With the desperate need to import so many vital supplies from overseas there will be severe worries as to the long term consequences of this move. With Iran providing support for Qatar the sea link will remain open into the brand new Port of Hamad which only began operations in November 2016 unless there is a direct maritime conflict between Iran and its neighbours, but regardless severe delays to Qatar’s supply chain are likely to affect deliveries for some while. As Qatar’s only land border is with Saudi Arabia, road and rail carriage are presumably no longer effective modes of transport until the situation is resolved.

Photo: The Port of Hamad may be the only entrance point for cargo being imported from overseas.