What is the Currency of Qatar?
The official currency of the state is the Qatari riyal. One Qatari riyal is subdivided into 100 dirhams. Qatar is the 56th largest economy and it relies on petroleum and natural gas for 70% of revenue, 60% of GDP, and 85% of the country’s total export. Its GDP is estimated to be approximately $166.9 billion, while a per-capita income of $71,481 is among the highest in the world. Although agriculture is a key component of every economy, it only accounts for 0.1% of Qatar's GDP. In mid-2017, Qatar fell out with its Arab neighbors, who placed sanctions on on the country, including preventing goods to and from Qatar from crossing their land, air, and territorial water.
History of Currency in Qatar
The Indian rupee, specifically the Gulf rupee, was the official currency of Qatar until 1966. In the same year, India devalued the rupee to boost exports, which caused Qatar and several other Gulf states to shun the rupee. The country planned to introduce its own currency, but briefly adopted the Saudi riyal before signing an agreement with Saudi Arabia in March 1966, which led to the introduction of the Qatar and Dubai riyal. One Saudi riyal traded for 1.065 Indian rupees, while the Dubai and Qatar riyal was equal to the Indian rupee before it was devalued. After Dubai became part of the United Arab Emirates, Qatar chose to issue the Qatari riyal separately from Dubai.
The Qatari riyal, shortened as QR, was introduced on 21 March 1966, after Qatar chose to drop the Indian rupee due to its devaluation. The riyal was pegged to the US dollar in July 2001 at a fixed rate of $1 USD = 3.64 QR. The royal decree enshrined the peg into the Qatari law and was signed by the then Emir of Qatar Hamad bin Khalifa Al Thani. According to Qatari law, the QR shall be pegged to the $US at a rate of 3.64, with an upper and lower rate of 3.6415 QR and 3.6385 QR, respectively, for selling and buying of the dollar by Qatari banks. Amid recent economic fluctuation and regional instability, the peg is under enormous stress and was quoted below the peg rate in June 2017, but the central bank denies plans to devalue the riyal.
Qatari riyal coins were introduced in 1966 after Qatar dropped the rupee as its currency. The first coins introduced bore the name of Qatar and Dubai in denominations of 1, 5, 10, 25, and 50 dirhams. After Dubai became part of the United Arab Emirates in 1971, Qatar began minting its coins that bore only the name Qatar in 1973.
In September 1966, banknotes in the denominations of 1, 5, 10, 25, 50, and 100 riyals were introduced by the Qatar & Dubai Currency Board. However, these notes were replaced in 1973 by the Qatar Monetary Agency Qatar, which broke away from an agreement with Dubai. The new banknotes came in the denomination for 1, 5, 10, 100, and 500 riyals. In 1976, a 50-riyal note was introduced.