Central bank says Qatar has enough in reserves to weather sanctions

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Qatar central bank said the country ‍has 340 billion dollars in reserves including holdings of its sovereign wealth fund that could help the Gulf state to withstand the isolation from its powerful Arab neighbors.

"This is the credibility of our system, we have enough cash to preserve any ... kind of shock," central bank governor Sheikh Abdullah Bin Saoud al-Thani told CNBC in an interview published early on Monday on the news channel's website.

Al-Thani said the central bank has 40 billion dollars in reserves plus gold, while the Qatar Investment Authority has 300 billion dollars in reserves that it could liquidate.

Qatar's central bank governor Sheikh Abdullah Bin Saoud al-Thani claps during the 58th Gulf Cooperation Council (GCC) Central Bank Governors' annual meeting in Manama, Bahrain on September 18, 2013. /VCG Photo

Qatari stocks have weakened and the riyal has been volatile in the spot market since Saudi Arabia, the United Arab Emirates, Bahrain and Egypt cut diplomatic and transport ties with Qatar on June 5, accusing it of backing terrorism.

Doha has denied these allegations.

"Qatar has already had a good and unique system. We have laws established against all kinds of terrorists ," al-Thani told CNBC.

"We work with the IMF (International Monetary Fund) and other institutions to establish our laws and audits and reviews.

"We have no challenges, we welcome those to review all our books, they are open," he added.

Al-Thani said while the central bank has noticed fund outflows from some non-residents, the amounts weren't particularly significant.

"There is more [money] coming in," he said, confirming that inflows are exceeding outflows.

He said long-term contracts in the gas and oil sectors were not seeing any disruptions.

Rating agency Moody's Investors Service earlier this month changed the outlook on Qatar's credit rating to negative from stable, citing economic and financial risks arising from the ongoing dispute between Qatar and the Saudi-led alliance.

Despite the market ructions, economists say Qatar, the world's top liquefied natural gas exporter, has taken a number of measures such as a planned boost in gas output and new transport routes to weather the crisis.

(Source: Reuters)

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