DOHA: The Governor of Qatar Central Bank (QCB) H E Sheikh Abdullah bin Saoud Al Thani (below) affirmed yesterday that the international reserves at the Bank amounted to QR144.7bn by the end of April, noting that these reserves are more than enough to face challenges arising from the unjust blockade imposed on Qatar.
The QCB Governor also noted that they (reserves) do not represent the international reserves of the State; they are only a small part used for monetary policy purposes and to meet the currency issued and local banks’ purchases of dollars as part of the Bank’s exchange rate policy.
Therefore, Qatar’s financial reserves are very strong and capable of countering any negative effects of the blockade.
“QCB aims to maintain the stability of the Qatari Riyal against the US dollar. This required the Bank to maintain adequate reserves of its foreign reserves, which must not be less 100 percent of the total issued currency,” the QCB Governor said in an exclusive interview to QNA.
Sheikh Abdullah also said that “data available until the end of April of this year indicate that the ratio of foreign exchange (forex) reserves to the currency issued has increased to more than 86.6 percent, which is more than eight times.
He also highlighted the role of QCB in providing financial liquidity to the State under the unjust siege imposed on it. The Governor noted that the Bank’s strategy during the first months of the siege focused on ensuring sufficient liquidity and reassuring the deposit holders of the Bank’s full commitment to the maturity dates of the withdrawals.
Therefore, periodic and regular meetings were held with officials of the financial institutions to identify any potential liquidity challenges and to develop appropriate plans to deal with them proactively.
In the meantime, cash was provided to local banks to counter any withdrawal of deposits. The banks used their government securities, which provided them with the required liquidity and gave a boost to the repo market. Many banks in Europe and America expressed their willingness to continue working with Qatari banks. As a result, the losses were compensated very quickly and the business was taken over as usual, the Governor said.
As for attempts to weaken the currency locally and externally, the QCB Governor explained that the currency (Qatari Riyal) was under pressure in the early days of the blockade, especially in the local markets and eventually the impact spread to the external markets.
However, the prices in local markets have quickly returned to normal, and currently the external market prices have come close to the official rate, thanks to the strength of the Qatari economy and the rapid response to these attempts. The central bank has been closely monitoring the developments, and has been in contact with the banks that have branches or representation abroad to understand the details and complexities of the process.
After reaching a sufficient set of evidence of attempts to harm the Qatari currency, the QCB conducted legal investigations into these attempts by contracting with a well-known law firm, the
Governor said, noting that the central bank had provided the law office with the information and is awaiting the official report and the outcome of the current litigation proceedings of the office.
According to the viewpoint of the legal authorities to which the file was referred, the State of Qatar will resort to all means to prove the damage, and will announce the results in a timely manner, he added.
