Today James Swallow talks about the types of companies currently investing in Qatar and emerging trends in the sector.
In a country that is evolving and diversifying as quickly as Qatar, it pays for shrewd business leaders to consistently be aware of the rapidly changing economic trends in the region.
Less reliance on oil and gas
A recent report has highlighted that Qatar’s non-hydrocarbon sector now accounts for 50.7% of the nation’s overall GDP for the first time.
For some time the Qatari government have sought to reduce the nation’s reliance on its natural resources to make its economy more robust and less susceptible to fluctuations in the oil and gas markets.
Whilst the hydrocarbon sector has declined 2.8% year on year – a result of lower crude oil production and temporary maintenance-related shutdowns – the rest of the economy has seen significant growth in an array of sectors.
What sectors are becoming more important?
Finance, real estate and business services grew significantly at 13.7% year-on-year in Q3 of 2014. This was the result of an acceleration in banking intermediation and the growing demand for housing by an expanding population of expatriates.
Outside of oil and gas, Qatar’s manufacturing industry is one of the largest contributors to Qatar’s economy. The sector is supported by Qatar’s government in order to maximise the natural resources the country has as well as to help further diversify Qatar’s economy.
According to the QNB Group (Qatar National Bank), the construction industry is the fastest growing sector. New roads, highways, real estate projects, the expansion of the Hamad International Airport and the new metro in Doha have all played their part.
Trade, restaurants and hotels also grew strongly as at 13.7% year-on-year; this is the result of a growing population and increased tourist activity.
What does this mean for businesses in Qatar in the future?
As the non-hydrocarbon sector continues to take up an ever increasing proportion of the nation’s overall economic output, there are an increasing variety of opportunities in the region.
As the populations expands, we will continue to see Qatar become more of a manufacturing and services hub as it becomes increasingly less reliant on exporting hydrocarbons.
As the population increases, we can similarly expect medical services, retail and the education sector to prosper in the near future.
James Swallow is Commercial Director of Middle East based PRO Partner Group. PRO Partner Group specialises in providing foreign investors with a seamless and financially efficient means to setting up a profitable corporate presence in the UAE, Qatar and Oman.