The Report: Qatar 2014
2013 saw the transition of power from the former Emir, Sheikh Hamad bin Khalifa Al Thani, to Sheikh Tamim bin Hamad Al Thani, his fourth son and second son with Sheikha Moza bint Nasser, a move unprecedented elsewhere in the Gulf but not unexpected in Qatar. With sustained, long-term economic growth, the highest per capita income in the world, a stable and well-capitalised banking sector, a sovereign wealth fund that is of true global significance and one of the largest reserves of natural gas just offshore, Qatar today has many advantages. It is clear that the country is in a strong position from which to continue its robust economic performance, and the years ahead will see a vast construction drive, in line with the principles of Qatar National Vision 2030 and catalysed by preparations for the 2022 FIFA World Cup. Oil and gas accounted for around 51.5% of Qatar’s economic output in 2013, while developing downstream facilities that add value to energy by-products, for example, has helped build a portfolio of petrochemicals, chemicals and fertiliser companies and looks set to see Qatar’s economic strength continue. With more than $222bn of projects in the pipeline, the construction sector’s growth has been forecast at 15% for 2014, while spending on infrastructure is set to reach $150bn in the run-up to the 2022 FIFA World Cup. Against this backdrop, Qatar looks set to continue offering a wide variety of opportunities for foreign investors.
Country Profile
2013 saw the transition of power from the former Emir, Sheikh Hamad bin Khalifa Al Thani, to Sheikh Tamim bin Hamad Al Thani, his fourth son and second son with Sheikha Moza bint Nasser, a move unprecedented elsewhere in the Gulf but not unexpected in Qatar. Qatari investments straddle the globe, and the world’s top financial, construction, energy, retail and real estate businesses are vying for a spot in this rapidly evolving marketplace. The country has set major goals along the path towards development, including making Qatar a leading sports capital, constructing a new city at Lusail and creating a knowledge-based economy, among others. This chapter contains a viewpoint from Sheikh Tamim bin Hamad Al Thani, Emir of Qatar; and interviews from Khalid bin Mohammad Al Attiyah, Minister of Foreign Affairs; and Abdul Latif bin Rashed Al Zayani, Secretary-General, GCC.
Explore chapterEconomy
With sustained, long-term economic growth, the highest per capita income in the world, a stable and well-capitalised banking sector, a sovereign wealth fund that is of true global significance and one of the largest reserves of natural gas just offshore, Qatar today has many advantages. It is clear that Qatar is in a strong position from which to continue its robust economic performance, and the years ahead will see a vast construction drive, in line with the principles of Qatar National Vision 2030 and catalysed by preparations for the 2022 FIFA World Cup. Qatar holds potential for investors, both domestic and international, as the country heads towards a much greater global presence in the years ahead. This chapter contains interviews with Sheikh Ahmed bin Jassim bin Mohamed Al Thani, Minister of Economy and Commerce; Ali Shareef Al Emadi, Minister of Finance; Saleh bin Mohamed Al Nabit, Minister of Development Planning & Statistics; Saad Ibrahim Al Muhannadi, President, Qatar Foundation; Chung Hongwon, Korean Prime Minister; and Fumio Kishida, Japanese Minister for Foreign Affairs.
Explore chapterBanking
Having shown considerable resilience in the face of the global economic crisis, Qatar’s banks now stand to benefit from the nation’s anticipated economic growth. A pipeline of large-scale projects and the government’s development strategy, which is set to use the country’s hydrocarbons revenues to bring about economic diversification, both promise to supply lenders with plentiful opportunities for asset expansion. The highly capitalised banks which operate in the domestic market are also well positioned to expand their brands internationally, a strategic goal considered necessary in view of the limited size of the home market. Moves into foreign markets were a prominent theme in 2013 and will likely remain so going forward as lenders seek to increase their international footprints. This chapter contains interviews with Sheikh Abdulla bin Saoud Al Thani, Governor, Qatar Central Bank; and Sheikh Hamad bin Faisal bin Thani Al Thani, Chairman, Al Khaliji.
Explore chapterCapital Markets
Regional political turbulence since 2011 has resulted in a challenging environment for exchanges across the GCC, but Doha’s relatively young bourse has shown its resilience over 2013. The Qatari bourse grew by 24.2% over 2013, led by a 38.7% expansion in the transportation sector. Even the year’s slowest-growing sectors – insurance and real estate – posted double-digit expansion. It has also continued to implement a strategic development plan that has established new indices and a junior market for small and medium-sized enterprises. GDP growth is expected to continue to grow over the coming years, with fiscal surpluses remaining high. This chapter contains a viewpoint from Adel Abdulaziz Khashabi, Head of QNB Financial Services.
Explore chapterIslamic Financial Services
The Islamic finance services (IFS) sector in Qatar is one of the most vibrant in the region and incorporates a rapidly expanding sharia-compliant banking segment, an array of financing companies, an insurance market that is well positioned to capitalise on the potential of an underserved market, and an increasingly deep Islamic investment component. Recent regulatory changes suggest that the government’s ambition to establish the nation as a centre for Islamic finance remains undimmed and, as the country gears up for the project pipeline associated with Qatar National Vision 2030 and the 2022 FIFA World Cup, sharia-compliant finance players are expected to reap the rewards of this support. This chapter contains an interview with Bassel Gamal, Group CEO, Qatar Islamic Bank.
Explore chapterInsurance
Qatar’s insurance sector has become the third largest in the GCC region in terms of written premiums. The sector is home to a range of domestic giants and international players that enjoy a choice of regulatory frameworks, and insurers are now gearing up to capitalise on the raft of infrastructure projects expected to arise from the national development strategy and Qatar’s hosting of the FIFA World Cup in 2022. Qatar Central Bank (QCB) stepped up to play a larger part in the governance of the sector and the much-anticipated mandatory health insurance scheme began to be implemented. Both developments have been welcomed by the industry and underpin much of the optimism currently surrounding the sector.
Explore chapterEnergy
Oil and gas accounted for around 51.5% of Qatar’s economic output in 2013, and investments in upstream and downstream capacity are set to ensure future growth. Qatar is working with international partners to build three new petrochemicals facilities, which will help to expand domestic output. Further, the government is also investing in research and development programmes, as well as looking abroad. QP International leads global investments, and the state has also announced the formation of Nebras, a $1bn fund to invest in electricity and water projects overseas, which will be managed by the Qatar Electricity and Water Company. Qatar is also looking to the possibility of reforming the sector in a bid to strengthen QP and to expand globally, developments that are likely to secure Qatar’s energy industry moving forward. This chapter contains interviews with Mohamed bin Saleh Al Sada, Minister of Energy and Industry; Sheikh Khalid bin Khalifa Al Thani, CEO, Qatargas; Hamad Rashid Al Mohannadi, CEO, RasGas; and Wael Sawan, Managing Director and Chairman, Qatar Shell Companies.
Explore chapterUtilities
An efficient and reliable supply of water and electricity feeds Qatar’s expanding economy, while the country’s hydrocarbons resources finance its tremendous growth. Major investments in developing the power supply have resulted in excess capacity in the domestic market, but forecasts suggest demand will begin to outstrip supply by 2018 at current capacity. Though government agencies or government-controlled companies dominate the utilities sector, there is still broad scope for private sector participation in areas such as designing, building and operating water and electricity infrastructure. Enhanced regulation will likely be key to encouraging greater participation from the private sector going forward. This chapter contains an interview with Essa bin Hilal Al Kuwari, President, KAHRAMAA.
Explore chapterIndustry
Building on Qatar’s comparative advantages, the government has focused on developing industrial sectors that support or leverage its energy resources and industry. Developing downstream facilities that add value to energy by-products, for example, has helped build a portfolio of petrochemicals, chemicals and fertiliser companies. Other investments include developing energy-intensive industries in steel and aluminium that can benefit from Qatar’s low-cost gas supplies. Shipbuilding is another growing segment that contributes to industrial output and supports the energy sector. While global economic conditions may present some challenges, local and regional demand is likely to remain strong, ensuring a positive outlook for Qatar’s growing industrial base. This chapter contains interviews with Abdulrahman Ahmad Al Shaibi, Chief Coordinator, Industries Qatar; and Abdulrahman Ali Al Abdulla, CEO, Muntajat.
Explore chapterTransport
Qatari authorities’ emphasis on infrastructure development is not surprising. Trade remains a key component of the state’s economic livelihood. Between 2000 and 2012, transport and communications’ share of GDP nearly tripled from 2.2% to 6.9%. Qatar allotted $45bn to finance transport infrastructure in 2013, and looking ahead, a growing transport and logistics sector fits within the government’s plans for the country’s future. Possible changes in construction conditions seem like the biggest potential challenge on the road ahead, while materials and contractor costs could rise significantly as more infrastructure projects continue to break ground. The authorities’ progress on Customs regulations is a positive sign, however, as smoother procedures lower costs and speed up projects. This chapter contains interviews with Saad Ahmed Al Muhannadi, CEO, Qatar Rail; and Nabeel Mohammed Al Buenain, Project Executive Director, New Port Project.
Explore chapterConstruction
The construction sector grew by 13% y-o-y in third-quarter 2013, driven primarily by spending on transport infrastructure. With more than $222bn of projects in the pipeline, sector growth has been forecast at 15% for 2014, while spending on infrastructure is set to reach $150bn in the run-up to the 2022 FIFA World Cup. The scale of construction activity in the region has created some challenges that Qatar, in particular, will have to address to meet its targets. The demand for building materials and bottlenecks in transport and logistics, for instance, are driving up the cost of construction. This chapter contains interviews with Sheikh Abdul Rahman bin Khalifa Al Thani, Minister of Municipality & Urban Planning; Essa Mohammed Ali Kaldari, CEO, Lusail Real Estate Development Company; and Khalid Al Rabban, Chairman, Qatar Primary Materials Company.
Explore chapterReal Estate
With data from the Qatar Central Bank showing that real estate prices rose by 103% between July 2009 and September 2013, the local market shows signs of steady recovery from the global financial crisis in 2008. The increase in prices points to growing confidence in the market and strong supporting fundamentals. Much of this growth can be attributed to government reforms that relaxed the rules for foreign real estate investments in 2004. Rapid population growth will continue driving demand for housing and office space, while the strong economy is likely to support retail outlets. Over the longer term, new space – particularly in retail – is set to come onto the market and will likely soften prices. This chapter contains interviews with Badr Mohammed Al Meer, Acting CEO, United Development Company; and Hamad bin Ali Al Hedfa, CEO, Mazaya Qatar Real Estate.
Explore chapterTelecoms & IT
Qatar’s telecoms sector has put itself on a sound footing, thanks to ongoing investments in domestic and global operations. With a solid fixed network, a growing satellite market and sprawling 3G coverage, residents enjoy high connectivity. The ever-rising demand for mobile data has already fuelled a drive for 4G coverage and could prove lucrative to providers even as the use of voice and SMS decreases. One of Qatar’s telecoms companies has launched mobile financial services in the last three years to woo customers, especially the expats who make up more than 85% of the population and often need to transfer money to their home countries, and both firms are looking for ways to expand abroad. This chapter contains interviews with Hessa Sultan Al Jaber, Minister of Information & Communications Technology; Sheikh Abdullah bin Mohammed bin Saud Al Thani, Chairman, Ooredoo; and Ali Ahmed Al Kuwari, CEO, Es’hailSat.
Explore chapterTourism & Culture
As a strategic priority for national development, the tourism sector is showing promise, and visitor numbers, particularly from the GCC, are on the rise. Business travellers are the mainstay of the sector, though Qatar’s growing status as a sports and shopping destination is also enhancing long-term potential, while a growing regional cruise market and a new port in Doha are raising interest and opportunities in expanding Qatar’s profile as a cruise destination. A new national museum is set to showcase the state’s vision of Qatar’s national identity, an aim that has underpinned cultivation of the country’s tourism and cultural sector. This chapter contains interviews with Issa bin Mohammed Al Mohannadi, Chairman, Qatar Tourism Authority; Hamad Abdulla Al Mulla, CEO, Katara Hospitality; and Khalid bin Ibrahim Al Sulaiti, General Manager, Katara Cultural Village Foundation.
Explore chapterEducation & Research
As part of a long-term strategy to diversify away from dependency on hydrocarbons and move towards a more knowledge-based economy, Qatar has placed considerable importance on education and training. Due to the fact that the Foreign Investment Law exempts the education sector from the requirement to have a local Qatari partner or sponsor, the opportunities for foreign investment and partnerships are numerous, and the process of investing is relatively straightforward. With the population swelling and the government channelling increasing amounts of funds into the system to improve it, chances are that there are opportunities available for any investor looking to participate in the sector. This chapter contains interviews with Sheikh Abdulla bin Ali Al Thani, President, Hamad bin Khalifa University and Vice-President of Education, Qatar Foundation; and Faisal Alsuwadi, President of Research and Development, Qatar Foundation.
Explore chapterHealth
Qatar’s health care sector is undergoing vigorous change, for both good and bad reasons. The good news is that Qataris are living longer. The bad is that more are living with lifestyle-related chronic diseases such as diabetes, heart disease and cancer. To meet this challenge, the government has been making sizeable investments in health care: Qatar now spends more per capita on health than any other GCC country, according to the World Health Organisation (WHO). A 2013 announcement stated that Qatar will funnel $10.4bn into health care over the next five years – a lurch upwards from the recent annual average of $367m. Conducting research, furnishing staff for clinics, supplying pharmaceuticals, building new facilities and running IT services all hold opportunities for private sector involvement. This chapter contains an interview with Abdulla bin Khalid Al Qahtani, Minister of Health and Secretary-General, Supreme Council of Health.
Explore chapterSports
Building on the success of the 2006 Asian Games, Qatar has made the development of sports a priority, a move that it has supported with significant investments, which bore fruits in 2010 when the country was awarded the status of host for the FIFA World Cup in 2022. On a wider scale, sport has become a driver of growth in many other areas of Qatar’s economy, as upgrades of infrastructure and construction of stadiums and other facilities get under way. The growth of sport also ties into efforts to improve human resources and quality of life across the country, in accordance with the goals of the National Development Strategy 2011-16 and the broader Qatar National Vision 2030. This chapter contains an interview with Sheikh Saoud bin Abdulrahman Al Thani, Secretary-General, Qatar Olympic Committee.
Explore chapterMedia
Known throughout the world as the home of Al Jazeera and of the Doha Centre for Media Freedom (DCMF), a local watchdog with a global reach, Qatar has developed a well-established and far-reaching role on the stage of international media. The domestic market, made up of traditional outfits in print, radio and television, as well as a burgeoning online segment, is also thriving. Both at home and abroad, Qatar is well placed to continue expanding its media activities both in domestic and international markets, and on a more commercially rewarding basis, and as such presents opportunities and challenges that make it one of the region’s more intriguing media centres.
Explore chapterRetail
Thriving on the back of an expanding economy and surging population growth, Qatar’s retail sector is now set for further expansion. With a string of giant malls inching towards completion and existing stores undergoing refitting and refurbishing, the country looks set to establish itself as a major regional retail centre. Location will be a major factor in competition, with transport links such as the new metro likely to favour sites close to stations. Over the longer term, continuing economic and population growth will lead to greater stability in the sector, with any surplus likely to filled.
Explore chapterAccountancy & Tax
This chapter contains an introduction to general issues for foreign investors in Qatar, an in-depth look at tax regulations, the perks for would-be investors offered by the Qatari Financial Centre, and information about the steps being taken to protect organisations in Qatar from fraud and other crimes. This chapter contains a viewpoint from Stephen Anderson, Managing Partner, PwC Qatar.
Explore chapterLegal Framework
This chapter contains a look at the legal environment and the framework for foreign investment in Qatar, as well as a rundown of the advantages investors can enjoy in the country’s new economic zones. This chapter contains a viewpoint from Khalifa Al Misnad, Founding Partner, Al Misnad & Rifaat.
Explore chapterThe Guide
The Guide takes a look at Al Zubarah, one of the largest and best-preserved examples of an 18th-century traditional pearling and trading settlements in the Gulf region, which is also the state’s first UNESCO World Heritage Site listing. It also contains hotel listings for business and leisure travellers, along with numbers for ministries, embassies and useful points of contact, and other helpful information and tips for first-time visitors.
Explore chapterTable of Contents
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