6 months ago
The trouble over Qatar may spill over to the luxury fashion houses in Europe.
Saudi Arabia, Bahrain, the UAE, Egypt, and Yemen have all cut diplomatic ties with Qatar and severed all land, air, and sea transportation—effectively isolating the Gulf nation from international commerce in the region. As a major investor and decent-sized market for many luxury brands, the rift could have surprising consequences for the fashion industry.
According to Business of Fashion, the nation’s sovereign wealth fund, Qatar Investment Authority, owns the luxury department store Harrods. Another Qatari-back fund, Mayhoola for Investments, has major stakes in Valentino and Balmain. Some industry experts are concerned the diplomatic isolation for Qatar could damage future prospects for those brands.
Despite its size, Qatar is also a sizable market for the luxury goods sector. Business of Fashion reports the country’s apparel and footwear market—worth $1.3 billion—was projected to grow 51 percent by 2019. However, that forecast shrinks the longer the diplomacy row continues.
In the short-term, the biggest issue for these brands is the logistical problems caused by the clamp down on imports and exports. All in all, the isolation of Qatar is a bad fit for the fashion industry.