Business prospects in Qatar
Qatar, a tiny Gulf state in the Middle East, is a relative newcomer on Australia’s export radar, but this ambitious Arab emirate is no mere blip on the screen. With around 15 percent of the world’s proven reserves of liquefied natural gas (LNG), Qatar is focused, financed and ready to do business.
This year, the country will double its LNG exports to 77 million tons, thrusting it to the top of the global per capita rich list. The International Monetary Fund has forecast growth of 16.5 percent in 2010, making it one of the fastest growth markets in the world and number one in the Middle East, far outpacing its Gulf Cooperation Council (GCC) neighbours. In such an environment, opportunities for canny exporters are plentiful and diverse.
Qatar may be small, but this cash-rich new kid on the block is determined to make its mark. That means spending strategically for sustainable growth. Outside the emirate, the growing presence of Qatari capital on the international scene is attracting much attention.
The Qatar Investment Authority (QIA), the country’s $75 billion sovereign wealth fund, weathered the recession with relatively few shocks, using the break to reassess and refocus. As the dust settles on the slowdown, the QIA, Qatari financial institutions and an abundance of private capital are all looking for interesting partnerships.
But spending at home is the key for potential exporters. The QIA is only one of many funds that benefit from vast budgetary surpluses. Other state investment vehicles dedicated to healthcare, education and stabilisation are also on the finance ministry’s pay list. The message from the ministry is to diversify this desert economy and to develop enterprise and society.
The government’s National Vision for 2030 focuses on human, economic, social and environmental development and is dependent on the continued influx of thousands of foreign workers, from unskilled labourers to experienced executives.
Much of the country’s estimated $35 billion in revenues for 2010 has already been earmarked for massive infrastructure projects that belie the recession elsewhere. Qatar is playing catch-up with more developed states in the region and has the growing LPG receipts to fund a vision in concrete and steel.
Development projects include the $14 billion Doha International Airport, which will have a capacity for 24 million passengers annually.
Add to this a massive port relocation project, new rail networks and the construction of entire new cities at The Pearl and Lusail, and the extent of the government’s infrastructure investment program becomes apparent.
Many Australian firms have already made their mark in Qatar’s construction boom. Last year, Victoria-based WWW Projects announced it would project manage the first phase of a $74 million deal to design, integrate and install the telecommunications and IT infrastructure for Ras Laffan Port, slated to be one of the world’s largest when complete.
The company is delivering cutting edge communications and security infrastructure for this key departure point for the emirate’s LNG-laden tankers.
Foreign expertise remains crucial to Qatar’s growth. “The country’s population has doubled over the last five years, mainly due to the arrival of skilled and unskilled expats,” says Kym Hewett, Austrade’s senior trade commissioner responsible for Qatar. “Today, around 80 percent of the population of 1.7 million is foreign.” The Government is keen to ‘Qatarise’ the workplace and young people are being trained to take the reins from foreigners in the future.
For the moment, however, there are simply not enough locals to manage and staff enterprises in this fast diversifying economy. Training and management skills will continue to command a premium in the years to come.
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