The ongoing Gulf crisis instead of being resolved are becoming more complex with new issues surfacing on the horizon. Qatar already made it clear earlier that the blockade which is veiled as a diplomatic crisis is a veiled economic warfare.
Qatar has further enhanced its argument of economic sabotage by alleging rival Gulf countries attacking its currency through “blatant, unlawful market manipulation,” in the letter which was sent to global regulators including Securities and Exchange Commission, regulators in the U.K. and Luxembourg.
Qatar stated that the manipulation of its currency is a well-planned economic attack waged to target its bonds and a well-coordinated scheme to extract funds from the Banks of Qatar creating shortage of liquidity.
Qatar Central Bank also showed a considerable outflow of funds from its financial system after the diplomatic standoff began.
The crisis has already imposed a pressure on Qatar’s financial system.as per reports, Fitch Ratings in August downgraded Qatar’s credit rating to AA- from AA because of geopolitical risks related to the diplomatic standoff, which it said was “unlikely to be resolved for some time.”
Qatar’s Finance Minister Ali Al Emadi expressed his concern to Wall Street Journal in November, about the financial drain and stated that Qatari authorities were investigating possible manipulation of its currency. He stated that “These tactics are not only unethical, but they give misleading information for international investors…about how the economy is doing.”
Possibly, Qatari authorities found a connection to the manipulation of currency when a presentation made by employee of Banque Havilland—a private wealth bank in Luxembourg with clients in the Persian Gulf—emerged on the internet last November.
The presentation was worrisome as it explained about the financial weapons that can be used to create pressure on Qatar to release money for protecting its currency that will be affecting by a purposeful targeting of its bonds.
The presentation entitled “Control the Yield Curve, Decide the Future,” was distributed by a group called “Global leaks” , who also sent journalist stolen emails from account of Yousef Al Otaiba, the U.A.E.’s ambassador to the U.S.
Though the group has completely denied to identify its members and source of information, it stated last year that it functions on the lines to “expose corruption, financial frauds which are done by rich governments.”
Banque Havilland is still silent on the allegation levied by Qatar but denied any kind of “improper conduct” and its “intend to execute any of the transactions on financial instruments” as stated in the presentation.
In the letters written to the global regulators Qatar’s lawyers has asked to “examine the extraordinary conduct of Banque Havilland” for devising “a plan to engage in financial warfare against Qatar.” They have also provided details of certain suspicious market moments that can only be caused in an attempt to manipulate the financial market.
Apparently, the case suggests that there is a planned economic attack on the economic institutions of Qatar by manufacturing and spreading pathetic image about Qatar’s economy with the aim to economically pull down one of the biggest competitor in the region.