Qatar’s continuing and successful drive towards self-sufficiency, sustainability and environmental awareness has continued during 2019, spurred on by the ongoing economic blockade. Proving, yet again, that Qatar welcomes challenges as opportunities for development.
The ongoing diversification of Qatar’s economy is showing positive results. According to the International Monetary Fund (IMF), ‘Qatar has successfully adjusted to the dual shocks of lower oil prices and diplomatic rift’.
The IMF predicts GDP growth of 2.8% in 2020, and with GDP per capita (current prices) at USD69,687 in 2019, Qatar is one of the wealthiest countries in the world – the IMF forecasts that the figure will grow to USD70,736.879 in 2020, USD75,624.629 in 2022, and USD83,263.488 in 2024. The population is expected to steadily increase from 2.753 mn in 2019 to 2.788 mn in 2024.
Business and tourism continue to grow
After achieving self-sufficiency in dairy and poultry products, the State is now beginning to export its surplus, with plans to later export processed fish and shrimp. Local farm production has reached 10,000 tonnes per year, and is expected to increase to 90,000 tonnes in 2020, with the help of 10 additional modern farms equipped with advanced greenhouse technology, ensuring sustainable year-round high-quality production and lower water consumption.
Massive infrastructure investments have been made, including the new city of Lusail, the Doha Metro, Hamad Port, the expansion of Hamad International Airport (HIA), and facilities for the 2022 FIFA World Cup Qatar™ including accommodation, transport, and tourism features. Much of the expansion has been financed with local money, but the authorities continue to seek greater foreign direct investment. Banks have diversified their sources of non-domestic deposits, and following a regional trend are looking to consolidate assets.
Qatar has made considerable adjustments to its legal framework to meet the needs of international partners: easing visa requirements, liberalising tax laws, and removing the need for non-Qatari businesses to have a local majority shareholder. Essentially, all sectors of the Qatari economy are now open for foreign direct investment, except banking, insurance and defence.
Qatar Financial Centre (QFC), an onshore financial hub that provides business-friendly regulation, has already benefitted from the embargo as foreign firms that used to serve the gas-rich state from other parts of the region are now basing themselves in Qatar. Similarly, Qatar Science and Technology Park (QSTP) has attracted more than USD1.2 bn in international investment.
The World Economic Forum’s Global Competitiveness Report 2019 ranked Qatar as the second most competitive Arab economy, and 29th globally out of the 141 countries assessed this year, moving up from 2018’s 30th place out of 140 countries. Qatar also ranks first in the Arab world and among the top 10 countries globally in several individual indicators.
Qatar is expected to see the completion of as many as eight shopping malls with an estimated 548,000 sq m gross leasable area of organised retail space by 2020, according to ValuStrat. At the end of Q3 2019, the total supply of organised retail space in the country reached 1.89 mn sq m, with new additions including Galeries Lafayette (21 High Street at Katara Cultural Village), and Al Waddan mall (Al Wakra).
The largest expansion programme in Hamad Medical Corporation (HMC)’s history has resulted in a 25% increase in the number of inpatient beds across its hospital network since 2016. With demand for healthcare services continuing to increase in recent years due to Qatar’s growing population, HMC has significantly expanded its capacity, opening five new hospitals and a number of specialist facilities in the past three years.
Oil, gas and petrochemicals of course continue to form an important part of Qatar’s economy. Qatar’s carbon-capture developments will benefit not just the State, but the world.
Hamad Port, Doha Port and Ruwais Port delivered an impressive performance in the first eight months of 2019, handling 2,524 ships, 892,525 containers and 277,600 tonnes of general cargo, according to Mwani Qatar.
In October, a new cruise passenger terminal was inaugurated at Doha Port as thousands of passengers disembarked from the megaship Mein Schiff 5, ushering in Qatar’s fourth and largest cruise tourism season. The new facility will act as a temporary terminal for the next two seasons until the completion of Doha Port’s expansion plan in 2022.
With 3,350 passengers aboard, Mein Schiff 5 is the first of 74 ships expected this season, a 66% increase in the number of ships from last season; in fact, 100,077 cruise-line passengers visited Qatar during the first six months of 2019. The new season will also be the first in which Doha acts as a turnaround port for cruise ships, with passengers beginning and ending their journey in Qatar. The port will host 16 turnaround calls, giving passengers ample time to explore the destination. In addition, nine ships will dock overnight during the season.
HIA reported a record-high total of 10.7 mn passengers in the third quarter of 2019, making it the busiest quarter and summer the airport has ever seen, with passenger numbers growing by 10.71% compared to 2018. HIA has also witnessed a record in aircraft movements with 60,135 movements from July to September 2019, a 5.44% increase compared to the same period in 2018, with August the busiest month.
Qatar continues to expand while embracing sustainability
HIA has revealed plans for its second expansion phase, which will include a spectacular indoor tropical garden in a central concourse, with the focal point of the expansion project a magnificent water feature.
Phase A will comprise the central concourse linking concourses D and E. Construction is to commence by early 2020 and will increase the airport’s capacity to more than 53 mn passengers annually by 2022. Phase B, which will be completed after 2022, will extend concourses D and E to further enhance the airport’s capacity to more than 60 mn passengers annually. The expansion plan includes landscaped retail and F&B space, with world-class Al Mourjan lounge located above the retail space, additional spas, gymnasiums, restaurants and business centres as well as other passenger facilities.
Qatar Airways Group Chief Executive, HE Akbar Al Baker, says: ‘The expansion of HIA is a vital part of the future success of the Qatar Airways Group, and of course of the country’s preparations to host the 2022 FIFA World Cup Qatar™ and beyond. It is also a strong sign that Qatar’s economy is robust and acts as a further economic stimulus, providing excellent opportunities for local and international contractors’.
Qatar Airways will be taking delivery of over 40 aircraft in 2020, believed to be largest delivery received by any airline in the world during a single year. It will also be the first airline in the world to use the GE360 Foam Wash, which will improve engine performance and fuel efficiency, reduce maintenance demands, and use 40% less water.
Qatar General Electricity & Water Corporation (Kahramaa), represented by the National Program for Conservation and Energy Efficiency (Tarsheed), has installed eight electric car charging stations free-of-cost to encourage motorists to adopt electric cars. Qatar’s Green Car Initiative aims to help switch up to 5% of total cars in the country to electric cars by 2022 in a bid to cut the carbon footprint.
The year 2020 is set to be another year of exciting developments and progress for Qatar, its people, businesses and foreign investors.
Author: Gina Coleman and Sarah Palmer
This feature is a special feature from the latest issue of Marhaba – Issue 75, which comes out in December 2019.
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