Moody's: Qatar crisis a negative for all countries involved

DUBAI, United Arab Emirates — Rating agency Moody's said in a report released Wednesday that the three-month-old diplomatic dispute between Qatar and other Arab states has created uncertainty across the Gulf region and could negatively affect the credit outlook of all the countries involved.

The report by Moody's Investors Service said persistent tensions between Qatar and its neighbors will have the biggest impact on Qatar and the island-nation of Bahrain, which has been roiled by low-level unrest since 2011.

The rating agency estimates Qatar has injected close to $40 billion, or close to 12 percent of its financial reserves, to support the economy in the first two months of the standoff. It said that $30 billion flowed out of Qatar's banking system in those months of June and July, with further declines expected.

Moody's said Bahrain's climbing debt and the impact of the past five years of turmoil there have made it the most exposed if tensions persist. The likelihood of the dispute dragging out for months to come prompted Moody's to downgrade Qatar's sovereign rating from stable to negative in early July.

The dispute erupted in early June when Saudi Arabia, the United Arab Emirates, Bahrain and Egypt severed all diplomatic and transport links with Qatar, accusing it of fomenting unrest in the region and backing extremist groups.

Qatar denies the allegations and says the moves are politically motivated. Much of the tensions stem from Qatar's support of opposition Islamist groups, which the quartet view a political threat.

The small Gulf country has dug its heels in, and looked to Saudi rival Iran, Turkey and Oman for new trade routes. Moody's says Kuwait and Oman, which have remained neutral in the dispute, could benefit marginally from the new trade routes to Qatar.

Related News

Eni CEO: Corruption investigation unlikely to affect mandate

Mar 15, 2017

The CEO of Italian gas and oil giant ENI says he does not expect that joint corruption investigations into a Nigerian oil field contract will impact a decision on renewing his mandate

EU clears Hungary to build Russia-financed nuclear reactors

Mar 6, 2017

The European Union has cleared Hungary to build two nuclear reactors with Russian help after Budapest made commitments to safeguard competition in the energy sector

Bayer pushes bid for Monsanto closer to $56 billion

Sep 6, 2016

Bayer AG pushes its bid for the American seed company Monsanto closer to $56 billion

You may also like these

Eni CEO: Corruption investigation unlikely to affect mandate

Mar 15, 2017

The CEO of Italian gas and oil giant ENI says he does not expect that joint corruption investigations into a Nigerian oil field contract will impact a decision on renewing his mandate

EU clears Hungary to build Russia-financed nuclear reactors

Mar 6, 2017

The European Union has cleared Hungary to build two nuclear reactors with Russian help after Budapest made commitments to safeguard competition in the energy sector

Bayer pushes bid for Monsanto closer to $56 billion

Sep 6, 2016

Bayer AG pushes its bid for the American seed company Monsanto closer to $56 billion

Search
Financial Markets

About Us

Deck Biz is an intelligent platform providing international and regional business news updates. You won’t get these insights elsewhere other than Deck Biz.

Contact us: sales@deckbiz.com