How Qatar Is Being Pushed Into The Arms Of Iran By Saudi Arabia And Its Allies

How Qatar Is Being Pushed Into The Arms Of Iran By Saudi Arabia And Its Allies

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I write about business and economics in the Middle East  Opinions expressed by Forbes Contributors are their own.

Slowly but surely, Qatar is moving closer into an alliance of sorts with Iran.

Hampered by a trade and transport boycott from former allies Bahrain, the UAE and Saudi Arabia which is almost in its sixth month, the small but extremely rich state of Qatar is being forced to find its friends where it can. Nearby Oman has proved to be one willing ally through these difficult months, as has Turkey. The most politically disruptive linkages, however, are being formed across the waters of the Gulf with the Islamic Republic.

Iran and Qatar have always had a strong incentive to get along reasonably well as they share a huge natural gas field, known as the North Field in Qatar and as South Pars in Iran. It was this fairly cordial relationship between the two countries that has been cited by the three other Gulf countries (along with Egypt) as a reason for imposing their boycott in June.

The trade embargo may have been an attempt to convince Doha to downgrade its ties with Tehran, but it has in fact had the opposite effect. In August, Doha restored full diplomatic linkswith Tehran, some 20 months after it had recalled its ambassador in the wake of a mob ransacking the Saudi embassy in Tehran. At the time its alliance with Saudi Arabia was among Qatar’s most vital in the region; now the opposite is the case.

A young boy poses for a photo after writing a comment on a wall bearing a portrait of Qatar’s Emir Sheikh Tamim bin Hamad Al Thani, in Doha, on July 6, 2017. (Photo: KARIM JAAFAR/AFP/Getty Images)

It is a sensitive issue for the U.S. as well. Some 6,671 U.S. troops are currently stationed in Qatar and the country hosts the Al-Udeid Airbase, which is the regional headquarters of U.S. Central Command.

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The latest sign of the blossoming friendship between Doha and Tehran came on November 26, when Qatar’s Economy Minister Sheikh Ahmed bin Jassim Al-Thani travelled to the Iranian capital for talks with government ministers on business links between the two countries, including Minister of Industry, Mine and Trade Mohammad Shariatmadari and Foreign Minister Mohammad Javad Zarif.

Following the talks, Shariatmadari said trade between the two countries was currently worth around $1bn a year, but noted that Qatar wanted to boost this five-fold to $5bn a year. It is not clear just how that might be achieved, but economic activity has grown sharply this year and there is certainly more potential.

Data from the Iran Customs Administration show that Iran exported $139m worth of non-oil goods to Qatar in the seven months to October 22 – a timeframe which covers both pre- and post-boycott periods. That was a 117.5% increase on the same period a year earlier. According to the Iranian business daily the Financial Tribune, the most important productstraded were bitumen, food and agricultural goods. There are signs that the growth in trade is accelerating, with $50m of the $139m total coming in the Iranian month ending October 22, up five-fold from the same time last year.

As well as exporting its own produce to Qatar, Iran is also now acting as a critical trade route for goods originating in other countries such as Turkey and Azerbaijan. In order to enhance that process, Qatar, Turkey and Iran signed a three-way trade agreement in Tehran on Sunday aimed at making it easier for goods to move between the three countries.

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