In this quarter, the state-owned energy company of Qatar. The world’s leading market player Qatar Petroleum has announced that it has completed the largest emerging market. Bond auction this year sold $12.5 billion in dollar bonds to increase. The production of liquefied natural gas and ensure its dominance of the market. Initially, investors made $40 billion worth of purchases as per the information accessible to the general public.
This record-breaking achievement does not indicate the consensus of the top executives of the world’s investment markets. When it concerns Qatar being an investment center. Still, it demonstrates the trust of investors around the world in the world’s largest organization. And that of the government in Qatar. The question is: will Qatar gain more general from the record-breaking transaction in the financial sector? And is the 2022 World Cup triggering an increase in direct foreign investment?
To predict the future development of FDI for the next 18 months, and perhaps over the next few years. We must first examine Qatar’s recent history. Everyone in Qatar will remember the day in June 2017, neighbors, and other GCC members. Enforced unconstitutional and substantive blockades against Qatar. The day that it happened, the sea, land, and air borders were shut down, segregating families, preventing students from completing their education programs, and creating problems for Qatari entrepreneurs and women who had assets in the countries blocking them.
The Local Economy is Strong
However, I think that many of you would agree that the blockade has helped Qatar be more independent from its neighbors and create an economically strong local economy. One of the industries that saw a dramatic change in this time was the food industry, e.g., the dearth production of milk products within Qatar was the primary reason that led some of the more well-known businesses. The region to create Baladna Food Industries, the local market leader in dairy products today. Numerous other businesses such as farms also have followed this successful story. “Made by Qatar” has become a popular brand.
Other positive outcomes arising from the blockade included that Qatari entrepreneurs could establish different trade routes. Many of them are accustomed to buying their merchandise through traders from Jebel Ali; before the declaration of the ban, they have now learned how to go to where the goods originate directly and then import products directly from the source to Qatar. Hamad Port Hamad Port was opened 48 hours after the start of the blockade and played a major contribution to the growth and economic recovery of the nation during the time.
Qatar Airways Established New Route
Qatar Airways quickly established new routes after they were not allowed to utilize the existing routes any longer, requiring flying through the airspaces of countries that blockade them. In terms of financials, Qatar proved that its earnings from LNG exports, as well as those cash reserves held by the Central Bank, Islamic and traditional retail banks as well as Qatar Investment Authority, is enough to sustain and stabilize the economy of the Gulf state in the toughest of times.
With this in mind, In this context, it’s interesting to examine the growth of FDI flow during the two years that followed after the four countries who were blockading each other implemented their political and economic embargo. Based on data from the UN Conference on Trade and Development inflow of FDI into Qatar dropped from $986 million to -$2.8bn in 2019. However, these figures indicate that the divestments of the country were close to $3 billion higher than investments in the country in the year 2019.
The Highest GDP Ratios
The total amount of FDI was $31 billion at the time of the year. In general, FDI flows into the Gulf state have been on an upward trend over the last few years, driven by the stability of Qatar’s government and a stable currency and infrastructure of high-quality with one of the highest GDP ratios per person, the country’s wealthiest local community, with one of the highest corporate tax rates around the globe with a rate of 10 percent.
The biggest participants in FDI flow are the United States, Japan, South Korea, and Singapore. At the same time, the principal areas that attract foreign investment include oil and gas construction, public works, and financial services.
According to UNCTAD’s Global Investment Trends Monitor data from January 24, 2021. Global FDI flow decreased by 42 percent across the globe in 2020 compared to 2019. In the same time frame, FDI in Qatar fell by a total of $2.5 billion during the initial 3 quarters of the year 2020. What are our expectations for between today and the 2022 World Cup?
The Leading Country in the Free World
The fact is that Qatar is a major player in the economy and is the most powerful state of all Arab nations. Through the blockade, Qatar’s elites were able to create and deepen political ties between Qatar and a number of the most powerful countries in the world. It is believed that these ties will assist Qatar in reaching its goal of becoming a world-class country in its investment and business conditions.
Qatar has signed more than 49 international investment agreements that will benefit from the current relationships with its political leaders. The agreements can have a positive impact on FDI flow into Qatar and assist the economy of Qatar in expanding and diversifying.
One of the biggest developments to establish Qatar as a sought-after investment and business hub for foreign investors. The local government in May of 2018 approved an amendment to the law that permits non-Qatari investors to have 100% of the capital in nearly all industries, and many Qatar Stock Exchange-listed companies have raised their foreign ownership limits to 49 percent.
New Real Estate Law
It was also announced that Qatar would be introducing a brand new real estate law at the same time as the cabinet’s decision to allow foreigners to purchase real estate in Doha is a major step in the same direction. It is well-known that Qatar’s ranking of 77th among 190 countries within the 2025 Doing Business report issued by the World Bank resulted from the most recent changes to the real estate industry, as well as a result of the high FDI flowing across Turkey in Turkey and Qatar.
In the year 2000, Qatar introduced a public-private partnership (PPP) law that enhances. The role of investors as long-term partners of the government’s strategies for diversification of the economy. According to the PPP law, investors will co-own infrastructure assets they constructed under concessions for long-term use. It is anticipated that this alone will bring in greater than $1.5 billion more in foreign direct investment.
Other benefits foreign investors can reap are the lower cost of energy. The cheap workers provided by migrants, and different incentives local authorities offer to foreign and local investors.
Logistics and Supply Chains
In recent announcements by officials from the government of the city, Qatar’s. The most important investment goals are the fields of fintech and advanced manufacturing health. Smart cities, smart manufacturing supply chains, and logistics, as well as the education sector. Supported by 10% of the 2020 budget for the state. Or $6.1 billion) Artificial Intelligence (AI) as well as information and communication technologies (ICT). To implement this strategy of awe-inspiring ambition. The Qatar Financial Centre’s Chief Executive Yousef Al Jaida declared earlier this year that Qatar. Financial Centre is trying to secure a $25 billion flow of direct foreign investments by 2022.
We have seen from past international tournaments how beneficial these occasions can be for local economies. We can therefore expect that the upcoming 2022 World Cup in Qatar. Will be a positive addition to the efforts of the local government to attract. Large quantities of foreign investment in the years ahead.
FIFA World Cup 2022
On the other side, On the other hand, on the other hand, World Cup. Is the second biggest sporting event in the world, after the Olympic Games. In normal conditions, the tournament will draw many thousands of people. On the other hand, this event provides a fantastic platform for Qatar. To show its country in the entire world’s eyes. It is a stunning nation with plenty of possibilities.
The platform for Qatar to show its country in front of world leaders will be the 2022 FIFA World Cup. And yes, there will be the growth of foreign investments that will be coming to Qatar soon. The local market for real estate is sure to benefit from the increase in interest from foreign investors. My advice to real developers and other market participants isto Get ready for foreign investors!
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