Qatar’s Third National Development Strategy ( NDS-3), spanning the 2024-30 period, builds on previous medium-term strategies to accelerate progress towards Qatar National Vision 2030 (QNV). Shaped by this long-term vision, the NDS-3 provides a framework for achieving sustainable economic growth.
In comparison to the NDS-1, for the 2011–16 period, and the NDS-2, for the 2018–22 period, the NDS-3 places a stronger emphasis on the need for a more transformative approach to policy reform and development execution. It incorporates seven national outcomes representing the country’s strategic priorities for its next development phase. These outcomes are accompanied by clear, granular targets in specific policy areas: economic diversification, fiscal sustainability, future-readiness of the workforce, social cohesion, quality of life, environmental sustainability and government excellence.
Addressing Challenges
The NDS-3 offers a balanced assessment of the country’s challenges. First, the non-hydrocarbons economy’s development, averaging less than 2% growth from 2017-22, was impacted by the Covid-19 pandemic and geopolitical tensions. Declining labour productivity, market entry barriers and regulations have further impeded growth. Diversification efforts are aiming to reduce the country’s reliance on hydrocarbons revenue, and policies encouraging private sector development could serve a key role in ensuring economic sustainability. Second, enhancing governance and digitising regulatory issuance could help streamline government services for investors. Third, high costs incurred by the current government-led development model have the potential to escalate, threatening fiscal sustainability and the welfare of future generations. Policy reform could serve to enhance talent attraction, entrepreneurship and innovation in the private sector, and lessen the reliance on low-skilled labour. Lastly, the global energy transition’s ongoing momentum further exacerbates these challenges, underlining the need for economic diversification. While the NDS-3 systematically approaches economic diversification by identifying priority economic clusters, the strategy envisions its ultimate success in effectively operating at the intersection of fiscal sustainability, labour and human capital policies, and efficient public governance.
Fiscal Sustainability
The IMF has reviewed Qatar’s fiscal developments in 2022-23, recognising significant income from hydrocarbons and a stronger fiscal position. The IMF commended Qatar for its discipline in public spending, especially under the strain of hosting the 2022 FIFA World Cup and managing high hydrocarbons prices.
Regarding mid-term fiscal strategy, the IMF recommended sustained prudence, revenue diversification and improved spending efficiency to encourage private sector-led growth. Qatar has updated its mid-term budget, which now covers a five-year span to support the NDS-3. Assuming continued spending discipline, the IMF predicts that Qatar’s central government debt will gradually decrease to nearly 30% of GDP by 2028. Several policy priorities – including maintaining prudent and countercyclical policy, implementing the value-added tax (VAT), broadening corporate income tax and streamlining the public wage bill – could help modernise the tax system and promote faster revenue diversification.
The NDS-3 reflects the IMF’s recommendations to establish a durable, shock-resistant fiscal framework, diversify and stabilise revenue sources, enhance the efficiency and effectiveness of public expenditures, and sustain a resilient balance sheet. The strategy intends to boost non-hydrocarbons government revenue by strengthening the tax administration and improving tax compliance. However, Qatari authorities have indicated that the introduction of VAT may be delayed until domestic and global growth is stronger. The NDS-3 also plans to manage public debt and contingent liabilities to create fiscal leeway for economic downturns by enhancing the government debt management framework, developing public sector and contingent liability frameworks, and implementing an outline for sovereign green financing.
Workforce Development
Labour market reforms are expected to be a key factor in Qatar’s long-term economic growth, with initiatives to attract more skilled expatriates expected to have the most profound effect. These insights align with the NDS-3, which advocates for a major shift towards a more productive labour market, prioritising highskilled jobs. The strategy foresees an upskilled Qatari workforce, supplemented by highly-skilled international talent. The NDS-3 sets a goal to increase the skills of its domestic labour force, with the aim of having over 46% of the total workforce in skilled or highly skilled jobs by 2030. To achieve this, Qatar plans to reform its labour immigration policy to better attract foreign talent. This will involve transitioning to a skill-based scheme, improving visa issuance and hiring processes for highly skilled expatriates, and introducing new visa types for entrepreneurs, freelancers, students and elite talent.
As more than 90% of employed Qataris work in the public sector, conducting civil service reviews and implementing performance-based compensation could streamline public employment and lessen the public-private wage gap. The NDS-3 aims for over 20% of the Qatari workforce to be employed in the private sector by the strategy’s end date. This indicates that the government plans to stimulate the private sector to enhance employment in mid- to high-skilled roles.
Streamlined Administration
The IMF’s recommendations underscore the importance of utilising expertise in managing special economic zones (SEZs) to stimulate broader economic growth in the country. These zones, overseen by dedicated authorities, have attracted foreign direct investment and increased trade through strategic sector-specific incentives. Nevertheless, the IMF emphasised that these incentives should be targeted, time-bound, and include strict exit criteria and sunset clauses to boost allocative efficiency and minimise fiscal risks. The economic benefits from SEZs could be further expanded by promoting stronger backward and forward linkages, thus extending the diversification gains across the broader economy. This strategic direction not only maximises the potential of SEZs, but also promotes sustainable economic development across Qatar, in line with NDS-3 objectives.
The NDS-3 aims for improvements in public administration performance, policy-making and accountability to shape a better business environment based on the experience from SEZs. The aim is to modernise service design and delivery, establish a one-stopshop portal, improve customer experiences and implement a performance tracking system. The plan also includes digitising 90% of services to citizens and improving data governance and management.
A key step towards this will be establishing a specialised centre for data and emerging technologies, such as artificial intelligence. This centre will spearhead several initiatives, including the creation of a data governance and management framework to improve data availability and quality, and system interoperability via enhanced data exchange layers. Furthermore, a national data programme will create opportunities for digitisation and automation across core government functions.
Policy-making will be streamlined to reduce mandate overlaps and improve policy alignment across government entities. It will also be supported by incorporating views from academia, citizens, residents, businesses and non-governmental organisations systematically. To this end and to enhance execution, the deployment of the suitable expertise and optimal capacity will be ensured. The strategy also aims to strengthen accountability in government institutions, enhance oversight bodies’ capabilities, and improve access to up-to-date information.
Engagement
The development of the NDS-3 involved an extensive stakeholder engagement process, with participants from the public and private sectors, civil society, academia and the general public. This joint effort, led by over 20 sector teams, and including more than 600 government and private sector leaders, set the stage for a more inclusive implementation phase. This wide engagement opens opportunities for private companies and foreign investors to actively influence the execution of specific NDS-3 initiatives. The coordination of planning and budgeting, which ensures stable funding, further increases the potential for successful collaborations. This strategy, together with a strong performance management process for monitoring and troubleshooting, positions private entities and foreign investors as key contributors to the NDS-3’s realisation, propelling Qatar towards its QNV goals.
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