Qatari Trade: The Journey Toward Middle Powerhood.

As was hard to miss, the US and Russia recently conducted negotiations regarding the continuation of the war in Ukraine. These took place in Saudi Arabia, marking a significant  diplomatic coup for the Gulf nation. This move somewhat represented a hijacking of the previous efforts made by Qatar to mediate the very same conflict, with Doha having already hosted humanitarian exchanges (Al Jazeera, 2024) and being suggested as a mediator for energy security talks involving both sides (Reuters, 2024). Where Qatar would seem to have a hold would be regarding the Israel-Hamas talks, having been the only nation to host successful ceasefire negotiations and productive talks between the two sides of the conflict. In recent years, the Gulf nation has prided itself on its mediating capabilities, seeing this as the best strategic approach to ensure its survival through a careful balancing act between as many surrounding actors as possible (Wirtschafter, 2024). Though entertaining alliances with interests such as Iran, Hamas, the Taliban and the Muslim Brotherhood has often led to heightened tensions with their Saudi neighbours (Steinberg, 2023), it has paired this foreign policy with various trade, media and cultural strategies to fully ensure its survival. By focussing on its trade in the past decade, one can analyse that, far more than just surviving, since the turn of the century the plucky Gulf state has transformed itself into somewhat of a regional – and potentially global – middle power.

LNG

In the 21st century, Qatar has emerged as one of the world’s pre-eminent gas suppliers, with a staggering 593% increase in natural gas production between 2000 and 2022, and an 811% increase in its natural gas exports in the same time frame (IEA, 2022). It is heavily aided by its proximity to the world’s largest natural gas field – the North Field – only 80 kilometres off its coast. Iran and Qatar both share a portion of the field, the two nations respectively having the second and third highest natural gas reserves globally (Reuters, 2010). Though much of this is exported to Asian partners (16.8% to China, and 14.9% and 13.6% to South Korea and India respectively), there is a large European market for the gas, with Italy, Belgium and the UK amongst the top ten importers in 2023 (OEC, 2023). This strategy highlights what Steinberg described as a goal to supply “liquefied gas to as many countries as possible” in order to diversify trade dependencies (Steinberg, 2023). Whilst diversification is the name of the game regarding gas exports, when analysing their total export/import values we see a slightly different trend emerging.

Exports

As the chart shows, Qatar’s export location has shifted in the last decade. Increased trade movements towards India and China underscores these nations’ growing interest in the region amidst a perceived Western vacuum. This pivot also follows Qatar’s broader strategy, as the two great global neutrals within that top seven. Say what you want about either regime, but regarding recent conflicts – not within direct proximity of their borders – they generally prefer a mediatory or neutral stance. Interestingly, despite writers such as Steinberg previously advocating for increasing European imports of Qatari gas to diversify from sanctioned Russian supplies, there seems to be little increase amongst the three European powers listed. There would be practicality issues,  regarding the difficulty and expense of LNG exportation compared  to pipeline gas, but these would be compounded by Qatar’s efforts to remain globally impartial. Given the ratcheting up of interventionist attitudes in the EU and UK since 2020 this certainly tracks: the Qataris are willing to mediate Russian releases of Ukrainian children, but remain unwilling to entangle themselves too deep into the current European landscape.

Imports

By comparison, the tale of their imports is something quite different. The diversification analogy certainly seems to hold up regarding importation policy. It is easy to notice that Qatar runs a significant trade surplus with the largest economies (except Germany), holding significant leverage regarding global economic power (Stiglitz, 2002), but also generating stability and independence by cutting itself loose from over-reliance on any single one of these countries (Mahbubani, 2008).

However, this does not necessarily tell the whole story as essential to the equation is Qatar’s hosting of US forces at the al-Udeid air base since 2001 – the largest US airbase in the Middle East (Cella, 2024). By breaking down the import numbers, this is evident: between 2010 and 2020, 26.65% of all total imports from the US were aircrafts or aircraft parts. However, from 2020 to 2023 this number averaged only 10.84%. Of course, this likely reflects various ongoing de-escalations – such as the signing of the Abraham Accords, or the 2021 withdrawal from Afghanistan – but such a prominent shift is important to note. Certainly, given recent developments regarding Israel-Hamas peace negotiations, the Qatari regime certainly has not suffered from deference to US strategy in the region. Yet, Cella argues that the state still curries favour with the Americans for its service over the prior decades – once again effectively managing two sides of the same coin (Cella, 2024).

A New Middle Power?

The Qatari trade strategy is clearly one of envy for many of the world’s leading nations. Whilst effectively managing multiple allegiances, neutrality and impartiality through clever adaptation of their imports and exports and utilising their wealth of natural resources, they continue their broader agenda: of becoming perhaps the world’s smallest middle power. Whilst the future for the Gulf nation is uncertain, expected continued exports to those powers less inclined toward ideological coercion suggests a continued trajectory of growth and influence.

Bibliography

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