Shatha Khalil *
Qatar is a difficult figure in the international equation, at various levels, and became an important presence on the political, economic, regional and international map.
Qatar is a peninsula located in the middle of the west coast of the Arabian Gulf, an area of approximately 11,521 square kilometers, with a population of about 2.5 million people, according to statistics released from a Qatar Statistics for the year 2017.
Qatar has the third largest reserves of gas in the world after Russia and Iran, which is estimated at 872 trillion cubic feet, or the equivalent of 188 billion barrels of equivalent oil, and based on the current production rate, the future reserves of Qatar are estimated by about 156 years.
Stages of the evolution of the Qatari economy
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The Qatari economy remains traditional until the forties of the twentieth century, as it was based on some initial limited activities such as agriculture, grazing, fishing and extraction of the pearl.
In 1949, Qatar has entered the era of oil, which its revenues have contributed effectively and efficiently in achieving comprehensive economic and social renaissance that reflected positively on the walks of life producing a versatile service and production , and high personal income level.
The rule of Sheikh Hamad bin Khalifa bin Mohammed Al Thani was marked by opening the prospects for foreign investment in the field of oil and gas to the country, and the exploitation of the external opportunities to
serve the Qatari economy, as happened during the crisis of global markets , which was characterized by a lack of liquidity, and those countries couldn’t obtain support from major countries such as China and Russia, while the State of Qatar poured billions of dollars, through the Qatar Investment Authority, which was established in 2005, which is one of the largest sovereign funds in the world, as the total investment managed by the fund outside Qatar had exceeded $ 100 billion, of which $ 30 billion in Britain.
The reign of Prince Hamad also strengthened, economic expansion by the establishment of funds to support the development of African countries, and supporting investments in sectors that have a popular interest such as: care of sports stars, buy sports clubs, spending on the World Cup, which spending amounted by more than $ 140 billion, and all this expansion has had a positive impact on the Qatari economy, and the important position of this country.
In the context of the development of oil production, it reached 720 000 barrels in 1995, but liquefied gas reached 15 billion cubic feet in 2013, Qatar is highly dependent on gas, and increased its investment on a large scale in the liquefied natural gas industry since 1990, as Qatar has become in 2006, the world’s largest exporter of liquefied natural gas, also gas liquefaction industry produced large quantities of condensate.
And the development in the oil and gas sectors in turn was reflected on the gross domestic product by more than 7 times in 1995, where it was $ 8 billion, and became $ 184 billion in 2012.
Here it must be noted that the expansion of investments in non – hydrocarbon sectors has a role in a significant increase in their growth rates and become the main engine for the growth of GDP in 2013.
The government and the family and social services are the fastest – growing components where the growth rate was 18.5%, followed by financial and real estate services 14.3%, and construction 13.6%, hotels and trade 12.8%. The growth in the economy outside the oil and gas sector is much higher in the hydrocarbon sector, which did not exceed only 0.1%.
The previous developments have led to increasing the share of non – hydrocarbon sectors in the GDP from 43.2% in 2012 to 45.6% in 2013, while the share of the hydrocarbon sector decreased from 56.8% to 54.4% in GDP.
As a result, the rapid economic growth was continued with positive rates and real values that reached 6.1% and 6.5% during 2012 and 2013 which
Led to skip of the GDP to the threshold of $ 200 billion to reach 202.5 billion dollars, and contributed to that mainly the large investments in non – hydrocarbon sectors whose growth rate was 10.1% and 11.4% within two years.
Qatar also recorded a large surplus in both the general budget and the trade balance and current account balance in external payments.
The estimated surplus in the general budget in the fiscal year 2013/2014 about 12.6% of the annual gross domestic product as a result of the sharp rise in investment income.
The surplus reached in both the trade balance and the current account balance of about 52.1% and 30.9% of GDP respectively, and the savings rate was about 58.4% of GDP, the highest in the world, and after Qatar in terms of the importance Kuwait comes by 55% and China 50%.
It should also be noted that the rate of investment to GDP has recorded a significant increase of about 26.8% in 2013, and about 28.2% in the first quarter of 2014.
With this, the Qatari citizen records the most expensive average income in the world, with a total per capita output reached from the value of GNP about 98.814 thousand dollars a year, and this does not include only the income of the individual, but all services provided by the state to its citizens from health care and education and ensure the future of its citizens and built infrastructure, and to achieve their social well-being distinguished of the world.
The role of Sheikha Mozah in the development of the State of Qatar:
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Qatar focused on the the participation of Qatari women in the development process noting that the focus on activating of the women ‘s participation in the workforce was one of the important indicators of improving her social and economic status and go out to the working field and gives economic independence and participation in community building.
As the wife of the Emir of Qatar , Sheikh Hamad , Sheikha Mozah bint Nasser Al-Musnad has contributed effectively and importantly to both local and global levels , as she sponsored the women and the education sector in particular, to improve the level and make it a vital goal to build a strong society capable of competing with the world in light of rapid technological development, as She served as Chairperson of the Qatar Foundation for Education, Science and community development, which has taken upon herself the task to establish a developed higher education system and expanded universities and occupied a huge site which were built in cooperation with the US, French and British educational institutions, as it seeks to make education as an insurance policy for the state for the time when the oil insurance drains .
And also globally in 2003, the UNESCO has appointed her as a Special Envoy for Basic and Higher Education, and she sponsored effectively for many international projects, and in 2005 was selected to be one of the members of a high – level group on the civilizations Alliance of the United Nations Organization, which was founded by former United Nations Secretary – General Kofi Annan.
And Qatar has achieved development and reform in education, and the present examples of efforts to raise the level of educational services in the State of Qatar, the establishment of the Education City , which hosts a number of international universities and research centers, and the establishment of science and technology centers in order to create a n economy based on knowledge and the creation of specialized scientific cadres to be more capable in the participation and competition in the global economy, as well as the establishment of the Qatari fund to take care of scientific research, and to encourage selected innovative research on a competitive basis in the fields of engineering and technology, physical sciences, medicine, humanities and take care of the innovation without geographical , political or cultural considerations.
Delivery of the flag to complete the process of construction and development:
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The delivery of the flag to His Highness Sheikh Tamim Bin Hamad Al Thani, in 2013, to continue to complete the march with a new vision to promote achievements, and determined actively to move towards institutional building of this country, through a national vision based on the glorious past and honorable present, and a promising future, through the arms of sons of the homeland who represent the real wealth, and the leadership of this country depends on them.
Qatar today make the future with a young leadership, possess the growing capabilities, and creative ideas noting that since taking office , Sheikh Tamim sought building state institutions, and the restructuring of ministries, founded by the Father, and the Prince Tamim confirms this consistency and this integration in business and tasks, Qatar is living a unique case of institutional building in the world of mostly internal conflicts, and administrative chaos, and dominated by an individual system, and thus miss the institutional work.
Qatar’s economy continues to grow and progress and renaissance , despite the decline in world oil prices, Qatar has occupied in the second place among the most developed economies in the world by about 7.1%., according to economic sources, and this is what distinguishes the Qatari economy and its ability to resist the decline in oil prices, and second place in terms of growth rate represents a unique case, according to a report of the international Monetary Fund for the Qatari economy, the list , which included countries that exceeds the total output of $ 100 billion in the year, where India came in the first place, and China and the Philippines, and Qatar has managed to exceed it by proper planning through the consolidation of disciplined institutional construction .
Qatar maintains diversify its income sources, which in turn sustains development, as it arrived in 2014 to 6.3%, which is an advanced development globally, and sustained growth , according to the IMF forecast, and at the same time Qatar has completed projects and infrastructure, while other projects have been initiated to work in it , and the other is going according to its intended program, which are in the dozens, Qatar is today a major workshop, is expected to complete its image at this stage with the approach of 2020, majority of major projects will be completed prior to this date, this does not mean that development and expansion and development steps to stop, there is Qatar’s vision of 2030, which draw a promising future for this country.
For the education sector, it is of great interest, as the spending for the fiscal year 2014- 2015 amounted by 26.3 billion riyals, and an increase of 7.3% from the budget for the year that preceded it, while health allocations amounted 15.7 billion QR, an increase of 12.5%, and this confirmation of their importance in advancement of society, emphasis was placed on the development of services provided in these areas, which are reflected positively in the international indicators, most notably the international competitiveness indicators, which Qatar was on the forefront of the Arab countries, and has achieved advanced Middle Eastern positions , and at the level of foreign policy, the Qatari effort continued in the efforts of security and peace.
Development strategy and the Qatar National Vision 2030 aimed at diversifying the sources of national income.
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The program includes investment revenues earned from oil and gas exports in key infrastructure, and manufacturing projects, in addition to the consolidation and development of financial and government services and those related to transport and tourism sector, would lead to a shift of economic growth momentum towards the non – oil sectors and increases its importance in line with Qatar national vision 2030 aimed at diversifying the sources of national income.
The Government of Qatar has embarked to carry out a large – scale program of public investment to promote economic diversification and prepare for the World Cup football; to achieve its strategy if it is succeeded to achieve the honor of hosting the 2022 World Cup, thanks to excellence in the use of sustainable technologies, and cooling systems used to the fullest in the stadiums and areas of training and spectators, It will be the ability of the players , administrators and spectators to enjoy the cool air – conditioned environment in the outdoor that its temperature is not exceeding 27 C degrees .
“Qatar is spending half a billion a week on the infrastructure building to host the 2022 World Cup , ” Qatar ‘s Finance Minister, Ali Shareef Al Emadi said , stressing: “that it will continue in order to reach full readiness to organize an amazing and great and exceptional copy.”
Qatar’s Finance Minister stressed that these expenditures will continue until 2021, before the start of the global finals by a full year, which is estimated by $ 200 billion until the 2022 World Cup.
He pointed out that it was awarded 90% of the 2022 contracts, stressing at the same time that this is not just stadiums, but for highways, railways, ports, airports, hotels and hospitals what he called ” the real infrastructure.”
He pointed out that the amount of $ 200 billion will be spent on infrastructure and not only on the stadiums and the stands, but the plans of Doha to be the main academic center and sports and tourism in the Middle East; To achieve this vision Qatar has to increase residential and hotel facilities in a distinguished way.
And its plans to host the 2022 World Cup, to set up 12 stadiums friendly of environment free of carbon emissions, and all the stadiums will harness the power of the sun’s rays to provide a cool environment for players and fans, through the conversion of solar energy into an electric current will be used in the stadiums.
Economic returns to host the World Cup:
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Although the World Cup will require huge funds for infrastructure work in order to meet the course requirements, but those actions planned at both accommodation and transport will form a large part of Qatar’s vision and long – term strategy of national, it is expected that the world Cup to operate to speed up the construction process to achieve a comprehensive benefit to the state.
And it is expected that this activity will have reflection on the investment positively directly and on Qatar ‘s economy that will lead to achieve positive economic motives for Qatar as follows:
The net economic interest is estimated to 8 billion Qatari Riyals equivalent to US $ 202 billion, as a result stemming from the largest economic activity carrying out in Qatar because of the organization of the championship.
The revenues of Construction and revitalization of the local economy estimated by 24.6 billion riyals, the equivalent of 6.7 billion and the effects of pre championship is a result of the development process in infrastructure and increased employment opportunities since 2010 and continue to 2022.
There are a long – term economic benefits between the years 2022 and 2035, valued at 9.9 billion Qatari Riyals, equivalent to US $ 2.7 billion, as a natural consequence of increasing the spread of the image of Qatar tourism in the world and its impact; which is reflected significantly on the following:
– the extent of assistance of infrastructure development to enable Qatar to get the highest rate of benefits beyond the year 2022.
– The development of the brand of the State of Qatar and strengthen it as a practical and recreational tourism that will positively affect the period after 2022.
There are indirect benefits, including:
– the recovery of the tourism sector, and health and social sphere.
– The second development strategy includes highway network development projects at a total cost estimated at 60 billion Qatari riyals.
– Development of solar – powered electricity for up to 500 MW.
Qatar National Vision of 2030
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The national vision is characterized by wisdom to complete a successful march initiated by Sheikh Hamad al – Thani, to take and receive it to complete the march by Amir of the country Tamim bin Hamad , which his administration is characterized of renewal, development and focus on sustainable development, and keep up with global progress and to achieve the prosperity of the Qatari society, which is the foundation on which the economic boom is built on , which its sustainment requires prudent management of depleted resources that ensure well – off for future generations, and wise management in Qatar believes to create a balance between reserves and production, and between economic diversification and the degree of attrition.
The Prince indicated in his vision of economic pillar that Qatar’s hydrocarbon abundant resources can be invested to make the sustainable development a reality, and goes on the transfer of these natural resources into financial wealth and a means to achieve the following:
• Investment in structures that the state to ensure for it the freedom of economic activity on the basis of international quality.
• Building effective mechanisms for providing of public services, and the formation of a skilled labor force, high productivity, support and promote the capacity related to increasing business and innovation.
• The State shall guarantee freedom of economic activity on the basis of social justice, cooperation and balance between the private and public activity, to achieve economic and social development and increase production and achieve prosperity for the citizens and raise their standard of living and provide employment opportunities for them in accordance with the rules of the law, these achievements make the Qatari economy expands to diversify the economy, and transform Qatar into a regional center for knowledge and industrial activities and high – value services, and here you should not reduce the significant challenges.
• The first challenge: the private sector to take the basic role in achieving sustainable development and future vision requires the support of business leaders in the private sector to achieve the role required, in addition to providing mechanisms for financial and non-financial support for the development and promotion of small and medium – sized enterprises, all of what has been achieved on the ground, Qatar still needs to promote competition and attract investment in a national and dynamic economy, that is not restricted by geographical boundaries .
• Another challenge: is to manage and avoid economic imbalances and tensions, far -sighted in a scientific manner to avoid minor risks that may arise in an emergency, and these risks include open and flexible markets and mechanisms of social protection that can afford for its cost and the financial preventive and strategic reserve, which would impact on the sustainability of economic development.
The vision focused on the appropriate economic diversification, and to maintain competitiveness through the following:
– the expansion of industries and services of competitive advantage derived from hydrocarbon industries, and the development of economic activities in which Qatar distinguished of it to build technical and human capacities and to meet the requirements of these activities is the reliance on research, development and innovation and the excellence in increasing the business and high level education aiming to economic development and community development.
– With respect to the oil and gas sector: the vision stressed on the responsible exploitation of this Depleted wealth and optimally to create a balance between reserves and production, and management of these sectors is a catalyst and engine for the advanced technological innovation and participation in the development of human resources and building of economic capacity .
– Make efforts in the development of the gas industry and strive to make it to occupy an advanced rank among the sources of clean energy for Qatar and the world, and most importantly is to keep a strategic reserve of oil and gas on the basis of long – term for reasons related to the national security and sustainable development.
Translated by: Mudhaffar al-Kusairi
Rawabet Center for Research and Strategic Studies