Economic Overview Of Qatar Economics Essay

Over past thirty years Qatar has experienced huge changes. A thriving financial centre has grown out of desert and world class sporting, scientific and educational facilities have been developed.
It is however important not to try and group Qatar with many of the other countries in the gulf enjoying similar economic and social developments: Qatar is not a new Dubai or an Arabic-oriented Miami. Qatar plans to become the “Singapore of the Middle East”.
In accordance with their “QATAR VISION 2030” various economic modernizations, good governance and business friendly policies were brought about making Qatar most attractive hub for various trade investments in the past decade.
Qatar is aware that their hydrocarbon resources will eventually run out, hence political and economic focus has moved towards diversifying its economy, investing abroad (through Qatar Investment Authority) and promoting healthcare, infrastructure, education and culture using the revenue generated from oil and gas industry.
Qatar also knows that it won’t succeed in transforming its economy alone. As a wealthy country of only 146,262 native Qatari (Qatar Census 2010), the main issue is not to source the finance to develop a Science Park: it is to attract foreign inventors, scientists and academics to build up projects within the Park. Therefore, Qatari government has launched major scientific and educational programs in collaboration with foreign companies and universities enabling them to foster research on its soil and build a “knowledge based economy” (World Bank).
Instigated in 1995, after the peaceful coup of the former Emir by his son who has a great vision “QATAR VISION 2030”, a crucial element of these development programs has been country’s paradigm: Qatar is a very small country with huge financial and natural reserves, with complete control of the economy by the Government.
The possibilities available in Qatar are therefore becoming clearer: investing in Qatar’s oil and gas industry is radically different from investing in Russia, Saudi Arabia, Kuwait, Brazil or Algeria. By gaining a foothold in Qatar, a Major in the energy industry doesn’t only drill as much oil as possible, boosting its short term profit and satisfying its shareholders, it also provides itself with access to a unique environment for building its future business model and investing in what we could call “flexible options”. It becomes part of the Qatari Vision Project, and benefits from the scientific and educational revolution that is occurring in Qatar.

Get Help With Your Essay
If you need assistance with writing your essay, our professional essay writing service is here to help!
Essay Writing Service

ECNOMIC SNAPSHOT
The Qatar economic growth started in 1995, ever since the country has been endeavoring to develop the oil and gas sector. When all the aspects of economic freedom is taken into consideration Qatar is ranked 2nd in regional ranking and 39th among the world with a score band of 69. (Exhibit 5). Qatar ranks 50 in the ease of starting a business (exhibit 8). Overall freedom to start, operate and close business is relatively well protected by Qatari government. By addition of a procedure to register for taxes and obtaining a company seal in 2010 number of days required for starting business have gone up from 6 to 12 days, but still stands much better compared to world average of 35 days. Obtaining a business license takes much less than the world average of 218 days, but costs are comparatively high.
Procedures(number)
Time(days)
Cost(%of income per capita)
Min Capital(% of income per capital)
8
12
9.7
79.8
Starting Business information chart (www.doingbusiness.com)
There is tremendous increase in FDI and Net Foreign Assets due to enactment of 2000 investment law. Corporate tax has been slashed to 10% from 35% in 2010 for a foreign corporation in Qatar. The overall tax burden is very low paving way to 99.9% fiscal freedom. (Exhibit 5&9). Rise in volume of Exports and imports and revenue year by year depicts the increase of industrial activity in Qatar
Qatar’s GDP confirms to be one of the fastest growing economies in the world with an average growth of 17.14% over the past five years (2005-2009 ) According to IMF Forecast Qatar’s GDP shows an upward trend which makes it a more fertile place for foreign investors.(Exibit1&2).
Affect of recession was seen in most of the aspects discussed but however Qatar bounced back well in 2010 with a GDP growth more than doubling to
17.4% in 2010 from 8.6% in 2009 (IHS Global Insight (USA), Inc.)
Qatar is more efficient in enforcing contracts in comparison with other oil producing countries. (Exhibit 10). Government spending on public amenities like roads and infrastructure is increasing making Qatar a good place to invest.
LEGAL FRAMEWORK:
Qatar being politically and socially very stable a legislative revolution was brought about way back from 1995(exhibit 13) which reflects Qatari desire to attract foreign investments and to make foreign investors to invest in Qatar, which it succeeded in.
.
LAW NO (13) OF 2000 INVESTMENT LAW:
This Law stands an exemplary of Qatar ambition to attract FDI and transform in to a industrial zone. This law brought about huge incremental changes in GDP, FDI, Net Foreign Assets, revenue, volume of exports and imports with many foreign companies investing in oil and gas and many other industries in Qatar over the past decade. (Exhibits 1, 2, 11&12).
Features:
This law allows 100% ownership in agriculture, health, education, tourism, development and exploitation of natural resources, energy or mining industries which was not permitted earlier.
right to lease land for setting up enterprises for up to 50 years, renewable for another 50 years at a nominal rent.
Right of duty free imports of raw materials and equipment required for establishment, operation or expansion of projects which are not available locally.
Foreign investments shall not be subject to expropriation.
Foreign investors are free to import and repatriate funds, as well as transfer profits and assets, and exchange money (Article 9).
Investment disputes can be settled through domestic or international commercial arbitration panels (Article 11).
Foreign companies may be granted tax holidays for 5 to 10 years and tax exemptions may be provided on a case-by-case basis.
LAW NO (7) OF 2005: QATAR FINANCIAL LAW
A new legislation was made law no (7) 2005 Qatar financial (QFC)law to establish “QATAR FINANCIAL CENTER” a financial and business centre, designed to attract international financial services, and major multi-national corporations. The first class business environment created by QFC enables firms to quickly establish their physical presence. QFC helps its firms in generating new and sustainable revenue streams providing access to local markets easily by paying local market rents.
QSTP:
Qatar science and technological park (QSTP) was set up in 2009 to attract foreign investors by providing them with ready to occupy world class research facilities labs, enabling companies to work and develop future projects.
Establishment of specific free trade regions like QFC and QSTP where regulations are eased and companies are given much more freedom along with various incentives like 100% ownership, duty free imports etc coupled with legal setup paved way for Qatar rapid growth.
Various other incentives and laws have contributed to the rapid growth of Qatar like:
Providing natural gas and electricity at subsidised rates.
well developed infrastructure
Low cost financing through Qatar Industrial Development Bank;
liberal immigration laws to avail services of foreign labour
easy access to world markets with air and sea connections
Laws(exhibit 13)
Appendix
Exhibit 1
For 2010, Qatar Economic Review, QNB Capital. Reference:(http://www.qnb.com.qa/qnb/DocIndex.jsp?currentPage=QNBEconomicReviewHYPERLINK “http://www.qnb.com.qa/qnb/DocIndex.jsp?currentPage=QNBEconomicReview&LangPref=en”&HYPERLINK “http://www.qnb.com.qa/qnb/DocIndex.jsp?currentPage=QNBEconomicReview&LangPref=en”LangPref=en)
Exhibit 2
IMF GDP forecast for Qatar to 2015 http://www.tradingeconomics.com/qatar/gdp-at-constant-prices-imf-data.html
Exhibit 3
Selected Graph from IMF http://www.tradingeconomics.com/qatar/gdp-at-constant-prices-imf-data.html
Exhibit4
Selected Graph from IMF http://www.tradingeconomics.com/qatar/gdp-at-constant-prices-imf-data.html
Exhibit5
Selected Graph from IMF http://www.tradingeconomics.com/qatar/gdp-at-constant-prices-imf-data.html
Exhibit 5
Year
Overall
Business
Trade
Fiscal
Government
Monetary
Investment
Financial
Property
Freedom From
Labor
 
Score
Freedom
Freedom
Freedom
Spending
Freedom
Freedom
Freedom
Rights
Corruption
Freedom
2010
69
73.7
82.2
99.9
73.7
65.9
45
50
65
65
69.1
2009
65.8
75.7
81.6
99.9
69.1
67.3
40
50
50
60
64.7
2008
62.2
60
70.8
99.8
72.1
69.4
30
50
50
60
60
2007
62.9
60
76.4
99.8
71.4
72.4
30
50
50
59
60
2006
62.4
60
74.6
99.9
71.7
75.7
30
50
50
52
60
2005
63.5
55
76.6
99.9
75.5
81.7
30
50
50
56
60
2004
66.5
55
76.6
87.5
69.7
90
50
50
50
70

2003
65.9
55
73
87.5
70.2
87.1
50
50
50
70

2002
61.9
55
77
87.5
56.7
81.2
50
30
50
70

2001
60
55
75
87.5
47.1
75.2
50
30
50
70

2000
62
55
75
87.5
47.1
73.6
50
30
50
90

Economic Freedom Index Chart Reference:(http://www.heritage.org/index/Explore.aspx?view=by-region-country-year)
Exhibit 6
Created Graph for Overall Score from Economic Freedom Index Chart
Reference :(http://www.heritage.org/index/Explore.aspx?view=by-region-country-year)
Exhibit 7
Created Graph for Business Freedom from Economic Freedom Index Chart
 

The Qatar Oil And Gas Industry Economics Essay

The interest for a Major in the oil & gas industry in gaining a foothold in Qatar goes far beyond mere geological considerations. While Qatar’s natural resources are attractive, the recent and massive investment in science and education is a more important incentive for potential investors. The natural resources are finite and when extinguished new energy sources will be required. Qatar is a world leader in researching these new sources and gaining access to this knowledge is a key objective for every company ready to compete on the future energy battlefield.

Get Help With Your Essay
If you need assistance with writing your essay, our professional essay writing service is here to help!
Essay Writing Service

Besides, in order to promote scientific research and education on its soil and to attract FDI and skilled labour, Qatar is implementing a whole new business environment, through the reshaping of its legal system and multiple financial incentives. Therefore, not only a company wishing to invest in Qatar would benefit from a state-of-the-art research environment, it would also enjoy a much safer political and legal framework than in the majority of other producing countries.
Introduction
Since the 1980’s Qatar has experienced huge changes, with rapid economic development and dramatic FDI increases. A thriving financial centre has grown out of nothing and world class sporting, scientific and educational facilities have been developed.
This report will evaluate the changes in the Qatar business environment and consider several policies and their impact. The focus will move to the oil and gas industry, with key challenges and advantages in the industry identified, before advice will be given for any prospective new firms.
Qatar at a Glance
Qatar is an unusual and unique setting for operations. It is important not to group Qatar with other gulf countries enjoying similar economic and social developments or as another generic Middle Eastern nation. Qatar is not a new Dubai or an Arabic-oriented Miami.
So while Qatar leverages its natural resources, it understands they are finite and can’t be relied on indefinitely. A 2008 document, Qatar Vision 2030, set the Emir’s objectives for Qatar up until 2030; to build tomorrow’s Qatari economy and society by attracting foreign investments and knowledge, diversifying its economy, investing abroad and promoting education and culture; to compete in the knowledge based international business environment.
Qatar natural resources give it the ability to fund this economic diversification. As a wealthy country the main issue is not how to finance a Science Park: it is attracting leading scientists and academics to develop projects there.
Therefore, the Qatari government has launched projects in partnership with foreign companies and universities. Instigated in 1995, after the peaceful coup by the current Emir, a crucial element of these development programs has been Qatar’s paradigm: a small country with huge financial and natural reserves, with complete economic control by the Government.
A Qatari elite comprising of Royalty, government officials and businessmen control the political, economic and business landscape. For instance the Prime Minister is also Qatar Investment Authority (QIA) CEO and the Deputy Prime Minister, Abdullah bin Hamad al-Attiyah, Qatar Petroleum (QP) Chairman. This is relevant as Qatar is an Arabic country. So when a deal is concluded and a contract written, the relationship goes beyond mere economic cooperation.
The possibilities available in Qatar are becoming clearer: Qatar’s energy industry is radically different to elsewhere, such as say Russia. By gaining a foothold in Qatar, a Major in the energy industry doesn’t only drill oil for short term profit to satisfy shareholders; it also has access to a unique environment for building future business models and investing in “flexible options” by benefiting from the Qatar scientific and educational revolution.
The Oil and Gas Industry in Qatar.
The Qatar economy relies upon its energy industry, especially to generate Government income (70% of total). Despite attempting to diversify the economy the energy industry accounted for 50% of GDP and approximately 85% of export earnings.
Qatar is integral to the worldwide energy industry and can become essential, as despite their large reserves they are currently the 22nd largest exporter of oil and 5th in gas production (Exhibit 1).
Exhibit 1
Qatar Oil and Gas Figures
Factor
Barrels
World Position
Oil – Production (A Day)
1.213 million
21
Oil – Consumption (A Day)
0.142 million
69
Oil – Exports (A Day)
0.753 million
22
Oil – Imports (A Day)
0
209
Oil – Proved reserves
2.541 billion
12
 
 
 
Factor
Cubic Metres
World Position
Natural gas – Production (A Day)
76.98 billion
11
Natural gas – Consumption (A Day)
20.20 billion
33
Natural gas – Exports (A Day)
56.78 billion
5
Natural gas – Imports (A Day)
0
144
Natural gas – Proved Reserves (A Day)
25.47 trillion
3
Qatar’s North Gas Field, discovered in 1971, is the world’s largest non-associated gas field. Accounting for 14.4% of world reserves and is sufficient to support planned production of natural gas for 200 years.
Qatar is the world leader in Liquefied Natural Gas (LNG). Large investments have been made in gas to liquid projects, with $20 billion invested in Ras-Laffan Industrial City. Qatar has ordered the world’s largest LNG tankers and trains to help develop their distribution network. QP has stakes in the Qatari LNG operations; Rasgas and Qatargas.
QP is the state owned energy company responsible for all phases of the oil and gas industry in Qatar. It makes huge profits and has a wide asset portfolio (Exhibit 2 and 3). It is a crucial component in the Qatar economy.
Foreign energy companies in Qatar operate through a variety of special contractual arrangements with QP, including joint-ventures (JV) and production-sharing agreements (PSAs).
Exhibit 2
Qatar Petroleum- Selected Income Statement-Year End 2009
2009
2009
2008
2008
QR’000
USD’000
QR’000
USD’000
Sales
118,140,863
32,447,388
168,488,206
46,275,286
Other Operating Income
6,447,876
1,770,909
5,901,367
1,620,810
Total Operating Revenue
124,588,739
34,218,297
174,389,573
47,896,096
Net Income For The Year
35,207,204
9,669,659
55,800,103
15,325,498
Exhibit 3
Qatar Petroleum Selected Balance Sheet – 31 December 2009
 
 
2009
2009
2008
2008
 
 
QR’000
USD’000
QR’000
USD’000
Non-Current Assets
232,604,448
63,884,812
185,902,097
51,058,011
Current Assets
49,703,545
13,651,079
60,132,185
16,515,305
Total Assets
282,307,993
77,535,890
246,034,282
67,573,316
Qatar Business Environment
Since the 1995 coup, Qatar has continually strived to improve economic freedom, the taxation system and make it easier to set up businesses, attempting to attract FDI. With the most influential set of laws discussed later.
Qatar’s main economic objective is to fund the diversification of its economy through growth in the energy industry. However, as discussed earlier, the country appreciates the need for technological support from international companies.
To attract FDI, especially the energy industry Majors, the country has implemented two major sets of policy: the reshaping the economic and legal environment, and the construction of a knowledge-based society.
A Changing Economic And Legal Environment.
Economic Snapshot
Since 2000 GDP growth has been strong and forecasts predict the economy will continue to grow rapidly (Exhibit 4).
Exhibit 4
Qatar GDP at constant prices
Many of the reforms target the energy sector: the objective is to fund growth of other sectors through Government revenues from energy.
Exhibit 5 and 6 suggests that this appears to be succeeding as there is a correlation between the growth in the energy sector and other sectors.
Exhibit 5
Qatar Gross Domestic Product at Constant Prices by Economic Sectors (2006 – 2010)
Exhibit 6
The recession affected all sectors and led to low 2008 and 2009 growth rates. This was due to low oil prices reducing the budget surplus, and thus government investment. However, Qatar recovered well in 2010 with GDP growth doubling to 17.4% in 2010 from 8.6% previously.
Exhibit 7
Heritage 2010 Index of Economic Freedom- Qatar
Year
Overall Score
Business Freedom
Trade Freedom
Fiscal Freedom
Government Spending
Monetary Freedom
Investment Freedom
Financial Freedom
Property Rights
Freedom From Corruption
Labour Freedom
2002
61.9
55
77
87.5
56.7
81.2
50
30
50
70

2003
65.9
55
73
87.5
70.2
87.1
50
50
50
70

2004
66.5
55
76.6
87.5
69.7
90
50
50
50
70

2005
63.5
55
76.6
99.9
75.5
81.7
30
50
50
56
60
2006
62.4
60
74.6
99.9
71.7
75.7
30
50
50
52
60
2007
62.9
60
76.4
99.8
71.4
72.4
30
50
50
59
60
2008
62.2
60
70.8
99.8
72.1
69.4
30
50
50
60
60
2009
65.8
75.7
81.6
99.9
69.1
67.3
40
50
50
60
64.7
2010
69
73.7
82.2
99.9
73.7
65.9
45
50
65
65
69.1
When all the aspects of economic freedom are considered, Qatar is ranked 2nd regionally and 39th in the world with a score of 69 (Exhibit 7and 8). Qatar ranks 50 in the ease of starting a business, as well as showing a rapid improvement in its Business Freedom score (Exhibit 7, 9 and 13).
Exhibit 8
Exhibit 9
Overall freedom to start, operate and close business is relatively well protected in Qatar. The new 2010procedure to register for taxes and obtaining a company seal, increased the number of days required for starting business from 6 to 12 (Exhibit 10), but this is lower than the world average of 35 days. The Heritage Business Freedom score has also improved, especially since 2008 (Exhibit 7), and is above the international average; however there is room for improvement to be a world leader.
Exhibit 10
Setting up a Business in Qatar
Procedures (Number)
8
Time (Days)
12
Cost (%of income per capita)
9.7
Minimum Capital Required (% of income per capital)
79.8
Exhibit 11
Qatar Global Competitiveness Report
While most economic freedom indicators have improved since 2000 the property rights, business and fiscal freedoms have experienced tremendous improvements (Exhibit 7).
Exhibit 12
Exhibit 13
Selected Producing Countries Doing Business Score
Country
Doing Business Rank 2011
Doing Business Rank 2010
2011 Reforms
Saudi Arabia
11
12
4
United Arab Emirates
40
37
2
Qatar
50
39
0
Kuwait
74
69
0
Algeria
136
136
0
Nigeria
137
134
0
Angola
163
164
1
Equatorial Guinea
164
161
0
Iraq
166
166
0
Venezuela
172
170
1
Those evolutions (partly due to changes in the legal systems discussed later) have attracted an increasingly number of foreign companies, as shown by the increase in FDI and Net Foreign Assets (Exhibits 14 and 15).
Exhibit 14
FDI into Qatar 2000-2010
Exhibit 15
Qatar- Net Foreign Assets
As already mentioned, FDI and Foreign Assets are crucial for Qatar: to increase energy industry revenues and to create its knowledge-based society, it has to attract skilled labour and technology-based companies.
An Evolving Legal Framework
These improvements of its business environment have been possible thanks to the reshaping of its legal framework.
Financial Liberalisation
The 2000 investment law is a milestone in Qatar history: it has turned the country from a hostile-environment for FDI into a magnet for investors.
It is also important to note that the Articles 2, 5 and 8 of this law directly target the energy industry (Exhibit 16). By creating the opportunity to own oil “blocks” and to settle for 50 years in Qatar, the government expect foreign companies to bring their technology and skilled labour to undertake long-term projects that will be mutually benefit. The effect of this has been seen with the large increase in FDI since the law was enacted (Exhibit 14).
Exhibit 16
Qatar 2000Investment Law
Article 2
Foreign investors may invest in all the sectors of the national economy provided that they have one or more Qatari partners whose share is not less than 51% of the capital.
The Minister may issue a decree allowing foreign investors ‘ share to exceed 49% up to 100% of the project’s capital, in the sectors of agriculture, industry, healthcare, education, tourism, exploitation and development of natural resources, energy or mining.
Article 5
Requiredreal estate may be leased to the foreign investor to establish his investment project, for a period not exceeding 50 years renewable.
Article 8
The foreign investments shall not be subject, eitherdirectly or indirectly, to expropriation.
Another major shift was the creation of the QFC (Qatar Financial Centre) and QSTP (Qatar Science and Technology Park, studied in more depth later), two, tax free, free trade zones in which sponsors are not required and 100% foreign ownership is allowed. Improvements in fiscal freedom have also been seen with the corporate tax rate slashed to 10% from 35% in 2010 for a foreign corporation in Qatar.
The QFC aims to attract banking and insurance companies while QSTP targets technology-based firms; they both have the same regulation. Therefore, from a legal point of view, both institutions share the same financial and legal incentives (Article 12; Exhibit 17).
Exhibit 17
Law No. (7) (2005) – On the promulgation of Law for the Qatar Financial Centre.
Article 5
The objectives of the QFC Authority shall be the following:
To establish, develop and promote the QFC as a leading location for international finance and business designed to attract international banking, financial services, insurance businesses, corporate head office functions, as well as other business.

Article 12
Notwithstanding any provision to the contrary in any other law or regulation, entities that are approved, authorised or licensed to carry on their activities in and from the QFC will:
1. not be subject to any nationalisation or expropriation measures or any restriction on private ownership;
2. have freedom to repatriate profits and realise investments;
4. Not be subject to any taxes except those set by or determined in accordance with the Regulations.
5. Be owned up to 100% by persons, companies and other entities which are not nationals of, or resident in, the State.
A Knowledge-Based Economy
As explained, Qatar has attempted to transform itself into a knowledge-based society by attracting foreign companies and universities to bring their skills and knowledge to Qatar and pave the way for the construction of a diversified economy and educated country.
For that purpose the Qatar Foundation was created in 1995. It then lead to the creation, in 2009, of Education City within QSTP (Exhibit 18).
Exhibit 18
Qatar Science and Technology Park (QSTP)
The idea underpinning QSTP is to attract foreign investors by providing them with world-class research facilities and a network of informal contacts that allow firms to benefit from each other’s knowledge generation. The legal and financial incentives have already been discussed.
By entering QSTP, foreign companies, especially in the energy industry, may take a decisive option for the future of their business: the large range of opportunities offered to them, through partnerships with other companies, can help them to shape their future business model.
Exhibit 19
Qatar Science and Technology Park Projects
Firms participating in the project
Project
ExxonMobil
ExxonMobil Research Qatar
ExxonMobil is working to develop automated remote gas-detection technologies to identify emissions at liquefied natural gas production and transportation facilities.
Airbus, Qatar Petroleum, Qatar Airways, Rolls Royce, Shell and Qatar Fuel
The consortium is working on developing a clean-burning aviation fuel derived from natural gas.
Shell
The programme builds upon Shell’s extensive experience in the GTL field and focuses on catalyst testing, product development and GTL by-product research.
Total
The Total Research Centre
It will undertake R&D activities in: multiphase oil and gas production carbonate reservoir modelling, acid gas management, polymer production and air-quality management.
Comparison with the USA
It is interesting to compare Qatar with the USA to identify areas of success and areas with room for improvement.
One key difference between Qatar and the US is that they epitomize two opposite political paradigms, while managing to both be magnets for technology-based companies.
Two opposite Political Systems
The US is one of the biggest countries in the world, the economic powerhouse of the world and epitomizes the spirit of entrepreneurship. Contrary to Qatar, each individual is expected to succeed through hard work and innovation. As shown earlier, in Qatar major scientific, economic or educational projects are launched by the government and individuals have little room for manoeuvre. For example, in the energy industry QP instigates projects.The US has little to no state ownership. The largest US company energy company, ExxonMobil, is the world’s largest publically traded energy corporation. Government intervention in the market is limited to regulations. The Government intervention in Qatar means that selected individuals have large power and this encourages corruption. As Exhibit 16 shows 2004 was the high point, which coincided with Qatar’s GDP growth and the availability of profitable opportunities. Recent efforts by the authorities have reduced corruption and the situation is improving.
The low level of corruption and the high property rights scores (Exhibit 22) mean that it much safer to do business, through easier contract enforcement and a more independent judicial system, in the US than Qatar; though Qatar is improving due to the 2000 laws.
Exhibit 20
Exhibit 21
Selected Comparison of Economic Freedoms available in USA and Qatar
Economic Freedom
USA
Qatar
Economic Freedom Ranking (Out of 179 countries)
8th
39th
Total Economic Freedom Score (Out of 100)
78.0
69.0
Property Rights (Out of 100)
85.0
65.0
Business Freedom (Out of 100)
91.3
73.7
Investment Freedom (Out of 100)
75.0
45.0
Freedom from Corruption (Out of 100)
73.0
65.0
Exhibit 22
One common objective: attracting skilled labour and fostering innovation, scientific research and education
Both countries encourage scientific research, creating partnerships between universities and companies and attracting technology-based companies.
A comparison of QSTP and Silicon Valley gives an indication of different approaches towards one objective. Silicon Valley has a location-specific advantage in the generation of knowledge related to the computer industry. One may consider that QSTP is the Qatari equivalent to the Silicon Valley, except that it is specialised in the energy field. Indeed, both have similar characteristics: they foster innovation by clustering companies, universities and scientists. If they share similar objectives, they were built through opposite processes: while Silicon Valley was created bottom-up, QSTP was constructed top-down. Silicon Valley was built organically thanks to innovative entrepreneurs, while QSTP is an artificial government creation: if both places operate the same way to foster innovation, they also reflect the economic patterns of both countries and can be used as examples of the business environment as a whole.
PESTEL Analysis
Political
Some major families (Al Thani, Al fardan, al-Attiyah…) are at the head of the country’s political and economic institutions.
The government is strong and active: Its intervention regards all the economic and social aspects.
Economic
A booming economy: GDP growth averages 15% annually.
Skyrocketing FDI.
A developing stock market.
Social
A three-strata society: Locals ,Western expatriates, Asian (Indian) expatriates.
The Kafala system can cause maltreatments regarding blue collar Asian and Indian workers.
Education system developing under the Supreme Education Council and Qatar Foundation.
Development of health care provisions by Supreme Council of Health, and the Hamad and Sidra Medical and Research Centres.
Technological
Attraction of foreign companies and skilled workers to foster technological headways.
Construction of research centers (QSTP).
Technological improvements are mainly undertaken in the energy and “green” industry.
Environmental
A stable political and economic environment.
Protection of foreign investors.
Low corruption, through favouritism and political connections.
Qatar Vision 2030: Government initiative- fostering education, scientific and economic diversification through major projects.
A favorable tax environment (tax rate was reduced to 15%).
Legal
Law No. (13) 2000:obligation to enter into a JV, as minority shareholder, to set up a business in Qatar, except for specific exceptions where 100% ownership is allowed.
Expropriation is forbidden.
Creation of free-trade zones (QSTP and QFC), with 100% ownership and no tax.
Advantages and challenges of doing business in the Oil and Gas Industy in Qatar
Advantages
A diversified asset portfolio
When entering in Qatar, a company has the possibility to create a diversified and audacious assets portfolio. In fact, Qatar is one of the only countries worldwide to have built LNG integrated supply chains and to have its own ships. Therefore, for instance, ExxonMobil has its most diversified asset portfolio in Qatar: it has taken positions in short, middle and long term options, with different levels of risks as shown by Exhibit 23.
Exhibit 23
Exxon Mobil Qatari Activities
This possibility to invest in flexible options given by QSTP is almost unique. By providing scientific and educational facilities to address the exhaustion of natural resources, Qatar also offers foreign and domestic companies state-of-the-art facilities to develop energy alternatives to fossil fuels. The programs developed for instance by Shell in QSTP (Exhibit 19) allows it to develop futuristic gas-to-liquids technology while producing LNG to finance this investment.
A safe business environment
The other major advantage of implementing an energy business in Qatar is the increasingly safe environment and the ease with business can be conducted, shown by independent ranking systems, compared to other producing countries. (Exhibit ?).
As already mentioned, it is possible to run oil and gas operations in Qatar through two main options: either a JV (minority shareholding) with QP or a 100% ownership of a hydrocarbon “block”.In many countries, like Russia, in which BP experienced difficulties in a JV, the political instability and the lack of protection of minority shareholders make a participation in a JV very risky. In Qatar a company involved in a JV is well protected (Exhibit ?).
Regarding the ownership of a “block”, we have seen that companies are well protected against expropriation and since the mid-1970s and the nationalization in of Shell and Dukhan Services there have been no cases of expropriation of foreign investment in Qatar. Qatar is vastly improving in regards to its respect of property rights with a 30% increase in their property rights score from Heritage in 2010, ranking it well above average.
So Qatar is a safe country to invest in, especially when comparing with other producing countries (Exhibit ?).
Challenges
Doing business in Qatar involves high costs
There are extra costs caused by the political and economic structure of the country combined with the already expensive nature of the industry.
First, as already mentioned, the political and economic scenes are completely intertwined in Qatar, therefore to succeed in Qatar excellent relationships must be maintained with influential individuals and families. Regular reporting and contact increases administration costs.
Maintaining good relationships with some of the richest families in the world has a price. In the Arabic culture gifts are a token of appreciation, and to reciprocate the gift must be of similar quality. As the Emir-related families in Qatar are known for offering expensive gifts, a company that operates in Qatar has to reciprocate. Therefore in Qatar complying with these social conventions are as important, if not more so, than the contractual obligations.
A program called Qatarization imposes employment targets of Qataris, they are highly paid and have a reputation for underperforming. This situation should improve as the education system does.
Finally costs are increased by the need for extensive legal support and advice. In Qatar confirming watertight contracts is crucial in protecting business deals and opportunities. Therefore sufficient legal representation is an essential, if costly, requirement.
A lack of transparency and clarity
As discussed earlier Qatar is attempting to create a safe and welcoming environment for FDI, Qatar has instigated heavy fines and prison sentences for corruption.
Qatar is well ranked in the Corruption Perception Index Ranking, 22nd in the world, and has an improving freedom from corruption score (Exhibit 7). However, despite The Amir, his Heir, and the Minister of Energy all fighting corruption it still exists. With favouritism and returning of political favours causing the major problems. Therefore, one of the major issues of foreign companies when they do business in Qatar is the lack of information and transparency regarding certain decisions.
Suggestions for a MNC entering the Qatar Oil and Gas industry
Positive Relationships
It is crucial to develop good relationships with high-ranking QP and government officials and the influential families. As discussed earlier there is little divide within Qatar between government and business. It is the Qatar Investment Promotion Department (QIPD) that liaises between businesses interested in FDI into Qatar and local businesses and government. With their support doing the process is easier.
This leads into the collaboration with QP, which is normally necessary. Several different options are available and the strategy selected should be dependent upon internal expertise, industry and the acceptable risk and reward relationship. The JV terms must be carefully selected as once an agreement is reached it cannot be cancelled. In Qatar no deal is complete until the document is signed; it is therefore advisable to only deal with companies that are happy to commit everything to paper. While this may not be an issue with QP, it could be with local suppliers.
While these relationships are crucial it is advisable to not become over reliant on local partners. Creating internal local connections and knowledge is crucial. Having internal Arabic speakers will allow a better understanding of the local environment as news and tender announcements can be released in Arabic four days before English.
Extensive Feasibility Research and Contingency Planning
A thorough feasibility study prior to entry is essential. Entering Qatar has high levels of uncertainty with asymmetrical knowledge, favouring locals. Therefore an exhaustive study will reduce this and identify possible problems and allow contingency planning to cover most eventualities.
An important consideration following on from this when entering Qatar is that while large profits are possible, it is a capital intensive process. Cost of living is high and expatriates are necessary, due to the shortage of local skilled labour. Therefore, before market entry the necessary resources must be available to complete the project, and that the expected returns are worth the risk.
Appropriate Representation and Support
A key piece of advice upon entering Qatar is to have legal representatives fluent i
 

Qatar National Vision 2030

The development and achievement of all social and economic aspects in modern communities depend on long-term goals from the country. The leaders must develop their countries by adopting the good working, clear vision and proper planning. Qatar national vision began in October 2008. The vision work to establish a strong link between the present and the future providing a standard high living for all people in Qatar and all coming generation. The big vision behind the project is to help to urge all people in Qatar to work hard together about achieving progress to their countries. Qatar national vision set rules to make Qatar progress and active country. The vision of national Qatar aims to present the best roadmap for the future of Qatar by achieving the growth economic and natural resources. The vision of Qatar work to develop the road of social, economic and all aspects in the future decades. By the developing the roadmap of Qatar, all citizens and all other people live in Qatar can benefit from all these developing aspects. The Qatar national vision woks to put country into an advanced position among all countries in the world in 2030. The vision aims to provide a high standard of living for the residents and citizens people in Qatar. The vision of developing cover all aspects living such as the social development, environmental development, economic development and human development.
Qatar National vision 2030 depend on Charity, equality, justice. They confirms on the values of religious, achieve security, constancy and stability in the country. Qatar national vision protect the freedoms of public and person and provide for people in Qatar equal opportunities.
Qatar National Vision depend on many pillars. Human development, economic development, environmental development and social development are the pillars in achieving the progress, stability, equal opportunities and prosperity for all people in Qatar. We will talk about the four pillar individually. The first pillar is the human development. This pillar makes to push all people in Qatar toward the prosperity. People in Qatar are able to support and strength their country’s growth. This need achievement for all improvements through heath care, economic and education. The development system of education is the first plane to achieve the vision of Qatar because education is the principle for achieving all stability and prosperity in the world. Qatar does it best for a long time to improve the system of education .Any country in the world, if want to achieve the development, they must work hard to develop all aspects of the country. The stability and progress of any country also depend on the health for the people living in the country. Qatar work to establish modern healthcare system to become effective. There are many hospitals in Qatar such as Primary Health Care Corporation and Hamad Medical Corporation and many other hospitals in Qatar aim to execute plans for developing their country and achieving the Qatar National Vision. The country plans also many achievement such as the Qatarization system. The Qatarization system work to enhance the nationals through presenting many opportunities for all people in the country.

Get Help With Your Essay
If you need assistance with writing your essay, our professional essay writing service is here to help!
Essay Writing Service

The second pillar that Qatar National vision depend on is the social development pillar. This pillar aims to modify the social of people in Qatar to develop and enhance the society in Qatar. This pillar calls people to preserve their communication and relationship between each other within the family. The pillar aims to make people in Qatar dealing easy and flexible with the life in present and the future to achieve the stability and prosperity. There are many aspects arising from the social development. One of the most strategy that arise from the social developing is to maintain the traditional and heritage of people in Qatar. This preserving of the traditional and heritage, strength the identity of all Arab in Qatar and to enhance the Islamic religion in the society. The second pillar also work to make the society in Qatar tied together. When people tied together or work together, they feel safe in Qatar. This pillar also enhances the tolerance and the good dealing between each other. Tolerance in dialogue is one of the achievement of Qatar National vision. When people strong their communication among themselves and preserve their moral and the values of religion, the society will become effective for all people in Qatar. The social society aims to guarantee their values and their rights.
The third pillar is called the environmental development pillar. Qatar seeks to develop and protect its land. God granted good natural environment for people in Qatar. The development of the environment help to the state to enhance its economic and social growth. Qatar calls for develop the environment by protecting its land. The protection include all aspects of the environment. The development will include the developing of air, water and land through following many means by learning people in Qatar how to maintain the environmental heritage and make the country strong. Building effective environment  and using the modern equipment should be done to enhance the public awareness between people for making their environment as an effective environment. Qatar uses many natural resources such as global water and hydrocarbon natural resources. These natural recourses will be diminish in the coming years so it will important for Qatar to get alternative ways by working with countries neighbors to protect their environment. Qatar work now to coordinate with Arab and Gulf Cooperation Council State to enhance trade and guarantee the financial ties.
The forth pillar that Qatar National vision depend on the economic development pillar. This economic pillar aims to enhance the economic achievement. This economic achievement work to enhance the high standard living for all people in Qatar now even the future generation in Qatar. There are many ways to enhance the economic and financial systems by following the right system and low inflation of financial system. The communication technology and ministry of information and Qatar foundation push Qatar into an advanced society among all countries. Qatar financial center is also responsible for bringing many huge industries to Qatar. Qatar work to provide its industries by developing its clean energy.
If you’re finding this free essay resource useful, you may want to consider our Essay Writing Service for Qatari students for a highly relevant essay that is tailored to your own specification.
Qatar National Vision launched in 2008. The Qatar National vision wok nowadays to establish a road between the present and the future. Qatar National vision serves all people and modern generation in Qatar. Qatar National vision aims to make all people in Qatar to work together. This vision will put Qatar in high position among all countries. The prosperity and stability will be spread in Qatar. The vision will protect the freedom of all people in Qatar. The society in Qatar will based on many good morals such as justice, good morals and equality. The vision also preserve the religious and ethical values in Qatar. Human, economic, environmental and social development are the pillars for the Qatar National vision. The achieving of human development through working people in Qatar to achieve the growth of country. Qatar aims to develop Education and the health care. The developing of social pillar through enhancing the heritage, making the country safe and the spreading of tolerance among people. The economic development pillar by using alternative resources and following the right financial system. The last pillar is the environmental pillar by protecting the land and getting the connection between the environment protection and economic growth.
References
Hukoomi Qatar e- government. (2017, Feb 15). Qatar National Vision 2030. Retrieved from Gov.qa: http://portal.www.gov.qa/wps/portal/topics/Employment+and+Workplace/Qatar+National+Vision+2030
Ministry of Ecconomy and Commerce . (2017, Feb 15). Qatar National Vision 2030. Retrieved from Mec.gov.qa: http://www.mec.gov.qa/en/qatar-at-a-glance/Pages/Qatar-National-Vision-2030.aspx
Qatar News Agency. (2017, Feb 15). QATAR NATIONAL VISION 2030. Retrieved from Qna.org.qa: http://www.qna.org.qa/en-us/StateOfQatar/Qatar-National-Vision-2030-en-US

Economic Environment Of Qatar Economics Essay

In last eight years the economy of Qatar has shown a remarkable growth, according to the report of World Economic Forum, among the Arab economies, Qatar stands first while globally it ranks 17th. Country’s authorities in the financial crisis sought to protect the local banking sector with direct investments into domestic banks. GDP bounced back in 2010 largely due to the elevated oil prices and growth was also supported by Qatar’s investment in expanding its gas sector in 2011. Economy of Qatar mainly concerns developing Qatar’s nonassociated natural gas reserves and increasing investment of private and foreign in non-energy sector. Still Qatar’s more than 50% GDP is from oil and gas and 85% of export earnings and 70% of government revenue are accounted by oil and gas. Due to oil and gas Qatar has highest per-capita income country – ahead of Liechtenstein – and the country with the lowest unemployment. Country has 25 billion barrels of oil in reserve which is equal to 57 years’ output at current level. Qatar also has proved reserves of natural gas exceeding 25 trillion cubic meters which is equal to 13% of the world total and third largest in the world.

Get Help With Your Essay
If you need assistance with writing your essay, our professional essay writing service is here to help!
Essay Writing Service

Qatar’s economy is mainly based on petroleum which accounts more than 70% of its government revenue, more than 60% of gross domestic product and 85% of export earnings. Qatar promotes investment, innovation, free trade, open competition and access to resources that will continue to bring long-term economic development to Qatar and much-needed energy to the world’s growing economies.
Macro-economic trend
Qatar is now the richest country in the Muslim world. Current GDP per capita registered a world record-breaking peak growth of 1,156% in the Seventies. This became quickly unsustainable and Qatar’s current GDP per capita contracted 53% in the Eighties. But rising global oil demand helped current GDP per capita to expand 94% in the Nineties. Diversification is still a long-term issue for this over-exposed economy.
This is a table of gross domestic product of Qatar at market prices estimated by the International Monetary Fund with figures in millions of Qatari Rials.
Year
Gross Domestic Product
US Dollar Exchange
Inflation Index
(2000=100)
Per Capita Income
(as % of USA)
1980
28,631
3.65 Qatari Rials
53
266.18
1985
22,829
3.63 Qatari Rials
64
104.82
1990
26,792
3.64 Qatari Rials
77
67.85
1995
29,622
3.63 Qatari Rials
85
55.75
2000
64,646
3.63 Qatari Rials
100
86.03
2005
137,783
3.64 Qatari Rials
115
127.05
For purchasing power parity comparisons, the US Dollar is exchanged at 5.82 Qatari Rials only. Mean wages were $59.99 per manhour in 2009.
In February 2012, the International Bank of Qatar reported that GDP grew by 19.9% in 2011, but estimated that 2012 growth would slow to 9.8%.
Economic outlook of Qatar
Currency
Qatari riyal
Trade organisations
OPEC WTO
GDP
$181.7 billion (2011 est.)
GDP growth
18.7% (2011 est.)
GDP per capita
$102,700 (2011 est.)
GDP by sector
Agriculture (0%), Industry (79%), Services (20.9%) (2011 est.)
Inflation
(CPI 2.8% (2011 est.)
Labour force
1.32 million (2011 est.)
Unemployment
0.4% (2011 est.)
Main industrie
Crude Oil Production and Refining,Ammonia, Fertilizers, Petrochemicals,Steel Reinforcing Bars, Cement, Commercial Ship Repair
Export goods
Liquefied Natural Gas, PetroleumProducts, Fertilizers, Steel
Main export partners
Japan 30.3%, South Korea 13.1%, India8%, Singapore 7.7%, United Kingdom4.2% (2010)
Imports
$25.33 billion (2011 est.)
Import goods
Machinery and Transport Equipment,Food, Chemicals
Main import partners
United States 15.5%, Germany 9%,United Arab Emirates 7.3%, South Korea 6.5%, United Kingdom 6.1%,Japan 5.6%, Saudi Arabia 5.4%, Italy5.3%, France 4.5%, the People’s Republic of China 4.2% (2010)
Gross external debt
$82.05 billion (31 December 2011 est.)
Public debt
8.9% of GDP (2011 est.)
Revenues
$112.79 billion (2011 est.)
Expenses
$37.88 billion (2011 est.)
Economic and Social Development
From the time when H.H. the Emir Sheikh Hamad Bin Khalifa Al Thani has taken his position on 27th of June 1995, Qatar has entered into a new era of national work and strategy. From that time, Qatar has made huge steps towards constructing its economic and political structure. Objectives and vision of this new era in Qatar’s modern history has focused on widening public participation in national decision-making processes and emphasizing the role played by the Qatari people in running their country’s affairs. This was realized through strengthening democracy, principle of liberty, and election instead of appointment in many governmental bodies and authorities. For the first time in Qatar, it went ahead to acknowledge and support Qatari women right to be nominated and elected in municipal elections. Furthermore, this new era was designed with elevating interest in Qatari youth through adopting academic and educational curricula that perfectly meet the community needs and satisfy the country requirements for qualified human resources and providing employments for Qatari fresh graduates. It has also approved and implemented a new approach in planning the national economy and exploiting and investing national natural resources. This approach was based on drawing new strategies and long term plans, encouraging private sector, as well as achieving the optimal use of national and expatriate expertise and cadres, and creating good economic climate to tempt investments.
Standard Living of Qatar
In 2007, Qatar has gained records with unprecedented economic growth rate of above 14% per annum. It is expected that this rate is going to head still upward in the next years. Also government spending is increasing; as the state budget has recorded a growth rate of 23.6% in 2007-2008. In 2008, for instance, the state budget has exceeded QAR 72,465.72 billion, compared to QAR 59,901.8 in 2007.
The state of Qatar is considered one of the highest living standard on earth, it has occupied the 33rd rank in 2009 Report of Human Development, issued by United Nations Development Programme (UNDP). The report stated that Qatar has achieved a major achievement when it reached to the 33rd rank
The new ranking shows what Qatar has got in issues related to human development. The report added that human development index in the state has jumped from 0.875 to 0.910. This index reflects progress and improvement achieved in areas related to health, education and GDP. In education sector, for example, the index indicates illiteracy rate going down to 6.9%, while school admission rate goes up to 80.4%, compared to 77.7% in 2008. Furthermore, in health sector, life expectancy rate increased from 75 years last year to 75.5 this year. The state of Qatar has realized a big hike in income per capita which reached USD 74.882 in 2009.
Qatar National Vision 2030
By 2030, Qatar projects to be an advanced society capable of maintaining its development and catering a high standard of living for its entire people. Qatar’s National Vision defines the long-term outcomes for the country and provides a framework within which national strategies and implementation plans can be developed. The National Vision addresses 5 major challenges facing Qatar: 
Modernization and preservation of traditions
Needs of this generation and the needs of future generations
Managed growth and uncontrolled expansion
Size and the quality of the expatriate labor force and the selected path of development
Economic growth, social development and environmental management
If this free essay resource has proved useful for your studies, you may want to consider our Essay Writing Service for Qatari students whereby you can acquire a highly relevant piece of academic learning material tailored to your own specifications.
The National Vision foresees development through four interconnected pillars:
Human Development: development of its entire people to enable them to maintain a progress of society.
Social Development: development of a just and caring society based on high moral standards, and capable of playing a significant role in global partnerships for development.
Economic Development: development of a competitive and diversified economy capable of meeting the needs of, and securing a high standard of living for, its entire people both for the present and for the future.
Environmental Development: management of the environment such that there is harmony between economic growth, social development and environmental protection.
Qatar National Vision 2030 was approved by Emiri Decision (44) for the year 2008.
 

PESTLE Analysis of Qatar

(P)OLITICS
Qatar has an emirate -type government. Qatar claims that it is developing into a constitutional monarchy but it doesnt allow political parties nor hold elections on a national level yet.Suffrage is currently limited to municipal elections (for both males and females aged 18 years or more). Expatriate residents are excluded, as are the vast number of residents who are prevented from applying for citizenship. The elected Municipal Council has no executive powers but may offer advice to the Minister.
Qatar is divided into ten municipalities,also occasionally or rarely translated as governorates or provinces:

Ad Dawhah
Al Ghuwariyah
Al Jumaliyah
Al Khawr
Al Wakrah
Ar Rayyan
Jariyan al Batnah
Ash Shamal
Umm Salal
Mesaieed

Since 2004, Qatar has been divided into eight municipalities. A new municipality, Al Daayen, was created under Resolution No. 13 formed from parts of Umm Salal and Al Khawr; at the same time, Al Ghuwariyah was merged with Al Khawr; Al Jumaliyah was merged with Ar Rayyan; and Jarayan al Batnah was split between Ar Rayyan and Al Wakrah.
(E)CONOMY
Basic Economic Facts
GDP: US$71.2 billion (2007 est, Qatar Statistic Authority)
GDP per capita: US$74,000
Annual Growth: 14.2%
Inflation: 13.73%
Major Industries: Petrochemicals, Financial Services, Construction
Major trading partners: Japan, US, UK, Singapore, South Korea, Italy, Germany, UAE, France, Saudi Arabia
Exchange rate: £1 = QR 5.97 (October 2009) US$1 = QR 3.64 (fixed)
AVERAGE OIL PRODUCTION
Global economy expected to grow 3.9% in 2010, emerging economies to expand 6.0%.US economy registered 5.6% growth in Q4 2009, fastest since third quarter of 2003.Global composite PMI indicates continued expansion of manufacturing and services industry activity. Qatar’s real GDP is expected to expand by 18.1% in 2010 Continued government support and increased hydrocarbon revenues to boost the economy.Central Bank’s net reserves estimated at US$ 19.3 bn (2009), up from US$ 9.8 bn in 2008. Business optimism in the non hydrocarbon sector has stabilized in last two quarters.Drop in selling price optimism becomes a drag on the hydrocarbon sector outlook. Global construction sector currently driven by infrastructure spending as commercial property undergoes correction.Demand outlook for Qatar’s construction sector shows signs of improvement with increasing optimism on new orders.Profitability levels are expected to stay muted due to higher raw material costs.While income from oil, currently produced at around 800,000 barrels per day, accounts for most of the government’s revenue, Qatar’s future economy will depend increasingly on gas. Qatar has invested heavily in world class Liquefied Natural Gas (LNG) facilities including a deep-water port at Ras Laffan to exploit the North Dome gas field. This field is the world’s largest non-associated gas field, holding 14-16% of world reserves. At current planned rates of extraction the field will last for over two hundred years. Qatar is already the leading global supplier of LNG and output is expected to increase to 77 million tonnes per year by 2012. There are two national gas companies, Qatargas and RasGas. Through the South Hook LNG terminal in Wales, Qatar is capable of supplying up to 20% of the UK’s gas needs. Government efforts to diversify the economy have led to the establishment of petrochemical, oil-refining, and fertiliser industries, as well as the establishment of Qatar Airways, the Qatar Science and Technology Park and the growth of Doha as a regional conference centre. Qatar pursues a vigorous program of “Qatarization,” under which all joint venture industries and government departments strive to move Qatari nationals into positions of greater authority. Growing numbers of foreign-educated Qataris, including many educated in the U.S., are returning home to assume key positions formerly occupied by expatriates. In order to control the influx of expatriate workers, Qatar has tightened the administration of its foreign manpower programs over the past several years. Security is the principal basis for Qatar’s strict entry and immigration rules and regulations.
(S)OCIAL
Nationality: Noun and adjective–Qatari(s).
Population (May 2008 est.): 1,448,446; males 1,096,815 (75.7%); females 351,630 (24.3%).
Population growth rate (May 2008 est.): 59.6%.
Ethnic groups: Qatari (Arab) 20%; other Arab 20%; Indian 20%; Filipino 10%; Nepali 13%; Pakistani 7%; Sri Lankan 5%; other 5%.
Religion: Islam (state religion, claimed by virtually all of the indigenous population).
Languages: Arabic (official); English (widely spoken).
Education: Compulsory–ages 6-16. Attendance–98%. Literacy (2004 est.)–89% total population, 89.1% male, 88.6% female.
Health (2007 est.): Infant mortality rate–17.46/1,000 live births. Life expectancy–74.14 years.
Work force (2006): 508,000. Private sector–61.2%; mixed sector–28.5%; government–5.6%.
Public health services and education are provided free by the state through the Ministry of Labor and Social Affairs, which also provides help to orphans, widows, and other Qatari nationals in need of assistance.Both law and Islamic customs closely restrict the activities of Qatari women, who are largely limited to roles within the home. Women are not allowed to obtain a driver’s license without the permission of her husband. Shari’ah law governs inheritance and child custody matters and favors men. However, growing numbers of woman are receiving government scholarships to study abroad, and some women work in education, medicine, and the media. Women comprise two-thirds of the student body at Qatar University. Although domestic violence occurs, it is not a widespread problem. Non-Muslims and Shi’a Muslims experience discrimination in employment and education. They are also unable to bring suits as plaintiffs in Shari’ah courts. Noncitizens make up 75% of the workforce yet are discriminated against and sometimes mistreated. A constitutional committee convened in 1999 to draft a permanent constitution that would allow for parliamentary elections. Corporal punishment is allowed by law, although amputation is not. In 1995, an American received 90 lashes for alleged homosexual activities.

Find Out How UKEssays.com Can Help You!
Our academic experts are ready and waiting to assist with any writing project you may have. From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs.
View our services

(T)ECHNOLOGY
Qatar’s strength is derived from its oil and gas revenues which have made it one of the wealthiest countries in the world in terms of per capita income. The Government of Qatar has ownership interests in several economic sectors, including oil and gases production, petrochemicals, and the steel and fertilizer industries. Impressive Technology is the main reason for Qatar winning bid for 2022 FIFA world cup.Qatar may not have the largest IT market but in 2010 it appeared better than many other markets. The IT services market is forecast to be the fastest-growing segment of the Qatari IT market between 2010 and 2014, outperforming the hardware and software sectors. Indeed, it has steadily increased for the last 10 years. With IT services spending estimated to grow to US$151mn by 2014, the next period promises to see more opportunities in sectors such as financial services, healthcare, education and communications. Nanotechnology in fields helping to make best quality products at lower cost. IT companies collaborating to access the market. Inventions and innovation rate. Mechanization trend in the country.
(E)NVIRONMENTAL
Environmental responsibility is vested in the Ministry of Industry and Agriculture. An Environmental Protection Committee was created in 1984 to monitor environmental problems. Conservation of oil supplies, preservation of the natural wildlife heritage, and increasing the water supply through desalination are high on Qatar’s environmental priority list. Air, water, and land pollution are also significant environmental issues in Qatar. In addition to smog and acid rain, the nation has been affected by the air pollution generated during the Persian Gulf War. Pollution from the oil industry poses a threat to the nation’s water. The nation’s soils have been damaged by pesticides and fertilizers, and its agricultural land is in danger of desertification. Endangered species include the hawksbill turtle, green sea turtle, and white oryx. Limited natural fresh water resources are increasing dependence on large-scale desalination facilities. The State of Qatar is a peninsula located between 24o 27- and 26o 10- N latitude and 50o 45- and 51o 40- E longitude. It is about 180 km long and 85 km wide, covering an area of 11,437 km2. Qatar is surrounded on three sides by the waters of the Arabian Gulf and connected to the south by land to Saudi Arabia. As Qatar is subjected to an arid climate, it mainly possesses an arid soil, with coarse texture, shallow depth and low retention low of soluble substances.
(L)EGAL
Qatar has a discretionary system of law controlled by the emir, although civil codes are being implemented; Islamic law is significant in personal matters. When contrasted with other Arab states such as Saudi Arabia, for instance, Qatar has comparatively liberal laws, but is still not as liberal as some of its neighbours like UAE or Bahrain. Qatar is a civil law jurisdiction. However, Shari’a or Islamic law is applied to aspects of family law, inheritance and certain criminal acts. Women can legally drive in Qatar, whereas they may not in Saudi Arabia and there is a strong emphasis in equality and human rights brought by the HRA. The country has not accepted compulsory International Court of Justice jurisdiction. On February 24, 2010, Qatar and Iran signed a defense co-operation agreement in which the two countries stressed the need to expand their defense cooperation.
Iran and Qatar will:-

exchange specialized and technical committees
expand cooperation in training
conduct joint campaigns against terrorism and insecurity in the region

March 10, 2010. Qatari Prime Minister Sheikh Hamad bin Jassim bin Jaber Al Thani has given his support to Iran’s right to nuclear technology, and considers Iran’s nuclear project to be for peaceful nuclear energy purposes.
If you’re looking to further acquire relevant academic learning material for your studies just like this one, then consider our Qatari Essay Service for a highly tailored assignment to expedite your studies.
ANALYSIS
If we evaluate Qatar on the basis of Porter’s diamond model:-
RELATED AND SUPPORTING INDUSTRIES
Qatar is one of the richest country of the Arab. Mostly it is dependent on its Oil and Gas resources. It is improving in IT sector and emerging as great threat to many markets because it performed exceptionally well in 2010. Oil and Gas industries are the major industries.Vodafone also entered the telecomm market.
FACTOR CONDITION
Qatar may look small, but in commercial terms it is a rising giant. This Persian Gulf Emirate is just larger than Connecticut and its population is less than 1 million.But its reform-minded government has ambitious plans to transform this peninsula into an international hub for tourism, finance, and education. U.S. companies interested in international opportunities should consider current trends and future projects in Qatar.
CONSIDER THIS –

Qatar has the third largest reserves of natural gas in the world.
Qatar’s per capita GDP is one the highest in the world at around $30,000.
Multi-billion dollar projects in numerous sectors in the coming years.
Pro-American business climate and strengthening U.S.-Qatar relations.
Business-friendly commercial procedures and political stability.

Strong general government balance sheet.Substantial external liquidity.Good economic prospects and high per capita income.There is great optimism and excitement among the business community in Qatar.By transforming hydrocarbon wealth into modern health facilities, tourism infrastructure, and western-style education institutions, the Qatari Government aims to engender a forward-looking and highly-skilled population. The Qatari Government has established credibility among the population and the business community.When plans and projects are announced, they are usually realized, and contracts are awarded in a generally efficient and transparent manner.Qatar is very amenable to western visitors, and security experts consider Qatar to have one of the lowest crime countries on earth. U.S. firms also report that industrial standards that are applied in Qatar are favorable to U.S. exports. Also, Qatar has a stable currency and the country imposes no foreign exchange controls. There are well-capitalized financial institutions in Qatar, most notably Qatar National Bank. Furthermore, Qatar allows up to 100% of foreign ownership in agriculture, manufacturing, health, education, tourism, power, and projects involved in the development and exploitation of natural resources, pending approval from the Qatari Government.
DEMAND CONDITION
Qatar demand condition is not so good.Qatar’s trade and hospitality sector expect better demand conditions in the second quarter. Sales volume and new orders seen declining .Most real estate businesses expect a decline in sales.It is the world’s largest LNG exporter of more than 31 million metric tons per year this shows the huge demand for QATAR’S natural gas in the world.
STRATEGY AND RIVALRY
Qatar pursues a vigorous program of “Qatarization,” under which all joint venture industries and government departments strive to move Qatari nationals into positions of greater authority.The biggest rivalry is in telecomm sector between Qtel and Vodafone.
 

Analysis of National Income of Qatar

Since 1939, Qatar has relied on the oil sector and was vulnerable to change in oil prices. Qatar’s growth was supplemented by natural gas sector with the discovery and exploitation of offshore North Field, the world’s largest natural gas deposit. The hydrocarbon sector is a major contributor to the National Income of Qatar. Oil and gas earnings revenue is expected to continue to be generated with the expansion of energy sector’s long term capacity. Qatar has opened its energy sector to international firms. There are gas reserves worth 910 trillion cubic feet and is expected to generate revenues for decades to come.

Get Help With Your Essay
If you need assistance with writing your essay, our professional essay writing service is here to help!
Essay Writing Service

In order to diversify the economy, revenue from hydrocarbon sector is reinvested in major infrastructure projects, tourism, finance sector and develop other components of hydrocarbon sector. Past few years the growth has been moderate and there has been a shift to non-hydrocarbon sector based growth. Qatar’s banking system has maintained the credit growth observed from 2003 to 2008 due to favorable monetary policy, adequate capital and less non-performing loans.
Spending for the preparation of FIFA World Cup 2022 is expected to have a major impact on growth rate of Qatar. Qatar’s GDP growth rate could be boosted by the announcement of discovery of largest-ever natural gas deposit off Emirates coast
Import and Export of Qatar

EXPORTS

 
 

IMPORTS

 
 

Country

Billions of USD

Percent Share

Country

Billions of USD

Percent Share

Japan

32.6

26.6

United States

3.9

14.1

South Korea

23.2

18.9

United Arab Emirates

3.2

11.3

India

14.7

12

Saudi Arabia

2.4

8.5

Singapore

7

5.7

United Kingdom

1.8

6.4

China

6.6

5.4

Japan

1.7

5.9

United Kingdom

4

3.2

China

1.3

4.7

Italy

2.7

2.2

Germany

1.3

4.7

Thailand

2.4

2

Italy

1.2

4.4

Spain

1.6

1.3

France

1.2

4.3

Indonesia

1.5

1.2

South Korea

0.8

2.9

Others

26.38

21.5

Others

9.18

32.8

Qatar exports Oil, gas and condensates to countries like Japan, South Korea and Singapore.

Qatar imports Machinery and Transport equipment’s, food, chemicals and manufactured goods. Major imports are from Japan, South Korea and India.

Revenue and Expenditure of Qatar

The revenue of Qatar has increased in the past decade due to increasing oil prices and increasing hydrocarbon production. Qatar avoided a drop in hydrocarbon revenue in 2009 due to long term gas contracts.
Investment income from QP, Qatar’s largest public enterprise with hydrocarbon companies, steel, fertilizers, real estate and Aluminum Company provide investment income which is net income after taxes and royalties.
Other income sources include corporate income tax of 10% levies on foreign companies.

Expenditure

In recent years substantial expenditure in utilities, land reclamation, communications and education.
Major capital projects executed by public enterprise Qatari Diar, real estate company owned by sovereign wealth fund QIA. Increase in government budget spending for capital projects.
Implemented National development Strategy
Preparation for FIFA World Cup 2022
2011 salary increase led to 5% point rise increase in share of salaries and wages in expenditure. Salaries of civil servants have increased.

GDP (Current US $)
GDP is the sum of gross value added by resident producers plus any product taxes and minus any subsidies on products not included in the value of their output. GDP has increased consistently in last 10 years except 2009 when there was minor drop in GDP. Major contribution to GDP is from Industry sector followed by Service sector. The Industry sector comprises of Construction, Hydrocarbons and other industries like manufacturing and utilities.

Country name

2004

2005

2006

2007

2008

Qatar

31,734,065,019

44,530,493,222

60,882,141,103

79,712,085,615

115,270,051,623

Country name

2009

2010

2011

2012

2013

Qatar

97,798,348,830

125,122,302,747

169,804,731,108

189,944,609,791

202,450,014,110

Sector-wise contribution to GDP (Nominal terms) in 2013 – Oil and gas mining sector is the major contributor to Nominal GDP with 119.8 billion US $. Construction and Banking related financials have contributed a share of 4.4 and 3.2 with 9.4 and 6.7 billion US $ respectively.

If this free essay resource is proving useful, you may want to consider our Essay Writing Service for Qatari students whereby you can acquire a highly relevant piece of academic learning material tailored to your own specifications.
GDP Per capita (US $)
GDP per capita is gross domestic product divided by midyear population. There has been steady increase in GDP and population of Qatar. Hence the GDP per capita took a hit from 84813 in 2008 to 62528 in 2009 but has picked up in the last 5 years. In 2013 GDP per capita was US $ 9335 which is 3rd largest in the world (as per data.worldbank). The population has tripled in past 10 years and if the rate of growth of population is greater than rate of growth of GDP then there could be a decrease in per capita.

Population of Qatar

Country name

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Qatar

720,383

821,159

967,602

1,152,459

1,359,114

1,564,082

1,749,713

1,910,902

2,050,514

2,168,673

Gross National Income, PPP
GNI is the Gross Domestic Product plus net receipts of primary income from foreign residents minus income by non-residents in the domestic economy. GNI has increased consistently in the last 10 years.

Country name

2004

2005

2006

2007

2008

Qatar

72,624,432,595

75,566,593,310

106,669,864,614

129,290,793,855

154,200,920,039

Country name

2009

2010

2011

2012

2013

Qatar

167,022,766,609

195,751,281,001

235,579,940,147

249,646,143,935

268,618,409,328

GNI Per Capita, PPP

Inflation, Consumer Prices (annual %)
Inflation is generally measured in Qatar using Consumer Price Index. Inflation is measured as percentage change in the consumer price index. It reflects annual percentage change in the cost that an average consumer has to pay to acquire a basket of goods and services. It is reported by Qatar statistics authority.
QSA released CPI in 2006 with base year 2002 and 1800 items in the basket from 400 suppliers. In June 2010 the base year was changed to 2007. Since 2009 QSA releases monthly CPI. CPI includes Food, Beverages & Tobacco, Clothing & Footwear, Rent, Furniture, Textile, Transportation and Communication and Entertainment etc.
Inflation peaked in June 2008 at all-time high of 15.1 % and a plummeted in December 2009 to record low of -4.9 % i.e deflation. 2-3 % of inflation (moderate) is desired by economies. Inflation plummeted in 2009 due to decrease in decrease in housing and food cost. An increase in inflation in recent years can be attributed to increasing demand for rental properties and increasing population has led to rising rents .Rents contribute 32% of CPI. Entertainment, recreation and culture which contribute to 11% of CPI index have also increased. Consumer price index touched 118 in July 2014.
FIFA World Cup 2022 games can lead to demand for large constructions and materials like concrete and steel. As demand increases price also increase. Preparations for World Cup include Construction of new city Lusail to host World Cup 2022, procurement of large metro network and major upgrade to Doha’s road construction. Government spending in FIFA World Cup 2022 along with influx of expatriate workers for the games could lead to inflation in near future.

Year

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Inflation

6.8

8.8

11.8

13.8

15.1

-4.9

-2.4

1.9

1.9

3.1

CPI

 
 

87.9

100

115.2

109.5

106.9

108.9

110.97

114.4

Unemployment, total (% total labor force)
Qatar has very low unemployment rate. The minimum unemployment was in 2000 and 2009 at 0.3 % and maximum in 2004 of 1.5%.
Qatar is a country with very low population and there is large number of expatriate workers in Qatar. Qatar is dependent on skilled and unskilled foreign laborers. In order to tackle unemployment of Qatari citizens, expatriate workers are replaced by Qatari citizens and precedence is given for Qatari Nationals in Labor Laws.
Labor force is growing rapidly. The private sector employs expatriates and Qatari citizen hold jobs in public sector. The Construction sector is the largest employer, employing more than 30% workforce. Other major employers are trade and domestic sector. In spite of its large contribution to GDP Oil and Gas sector utilize less than 10% of workforce. There was a salary increment in Public sector in 2011 and 2012 which has an impact on National Income.

GDP Growth Rate
Qatar was one of the world’s largest fastest growing economies during the period of 2006 to 2012 driven by Hydrocarbon sector. The growth rate has decelerated in 2012 and 2013 due to temporary prohibition on LNG. As a result of government’s freeze on additional gas development projects in North Field until 2015, extraction of gas reached full capacity. The Hydrocarbon sector growth has reduced and hence its contribution to GDP growth has taken a hit. The Non-Hydrocarbon sectors like Construction and finance have made major contribution to GDP growth. The real GDP % change was 6.2% in 2012 and 5.6% in 2013.
Qatar’s growth rate has increased to 6.2 % in Q1 of 2014 contributed by ‘building and construction ‘ and financial services sector. The national income could be affected by factors like decreasing price of oil, increasing productivity of labor, non-hydrocarbon economy including construction, increasing population etc.

Balance of Payment
All monetary transactions at specific period of time is monitored using balance of payment. It is calculated quarterly and yearly. There are Financial, Capital and Current account. Qatar has trade surplus indicating low capita
 

Case Study Of Qatar Diar Commerce Essay

The real estate industry is a development process that involves establishment of real estate in prepared land by individual, government or developers. In this work Qatar was chosen as the country and Qatar Diar as the real estate company.
To support growing economy of Qatar with an eye to manage Qatar’s real estate development priorities Qatar Diar was established in the year 2005 by Qatar Investment Authority (QIA) which is the autonomous wealth fund of Qatar state. Northwest of Doha and on the coast of Arabian Gulf Qatar Diar’s headquarter is located. It started with $1bn capital. Its main concern was investment in real estate and community based projects. Since the start the company has worked on its portfolio which is worth $60bn estimated through its global investments.
Vision and Mission:
Qatar Diar’s vision is to be the finest real estate company in the world by valuing consumer imagination, cultural values and inspiring relations. Company’s vision statement is so far being honest with its vision. It has since its incorporation focused on luxurious ventures.
Despite the fact that Qatar hasn’t seen booming real estate bubble like its neighbour UAE Qatar Diar has provided with excellent opportunity to represent Qatar in the real estate market.
Mission of Qatar Diar is to improve quality of life of Qatar’s people and in places they will have project by creating distinguished grand development projects by valuing top industry standards.
Since the beginning the company has worked on the standard of its developments and it is evident from the projects they have done so far. More discussion on that will be in the next section.
Projects of Qatar Diar:
In a short span of time Qatar Diar has managed to create a global portfolio of real estate projects. At present the company has projects in Qatar and GCC, Asia, Europe, The Americas and Africa.
Company’s first project was Lusail City which was launched in December 2005 and soon it gained momentum. It wasn’t long when Qatar Diar’s innovative outlook started gaining praise for its work. This city is progressively self-contained which is the largest singleton real estate development undertaken in state of Qatar.
Although the project hasn’t completed yet but Lusail have already created buzz about Qatar’s grand scale vision on next generation of developments. Qatar Diar already has become synonymous to quality. Lusail Real Estate Development Company started its journey in September 2008 to operate the expansion, construction and other development operations in legendary Lusail City Development.
In 2009 November under Qatar Diar’s flagship Qatar Railways Development Company was established which was of significant value for its portfolio. This company brought Qatar’s vision of creating a fully integrated national rail network and this regions first ever integrated railway system into reality.
In parallel with its developments in Qatar, Qatar Diar has always been committed to focusing on international market simultaneous to domestic market. Not only life of Qatar’s people was touched by Qatar Diar but also it has touched million people through its worldwide development ventures. As of now it is now one of the most famous, trustworthy, respected real estate company. It has become possible because of its continuous commitment to quality service, developing communities with state of the art innovative designs, worthy partnerships and trademark sustainability promise.
In January 2012 report released by Qatar Diar it has US $4 billion capital with currently undergoing 49 projects solely in Qatar related to development and planning. Also they have projects in 29 countries all around the world which combined can be valued at US $35 billion.
Strategic Business Management and Planning Tool:
Every business operates in micro and macro environment. To be successful in this competitive age every business have to have strategy for its operations whether its company management or marketing its products. For a company like Qatar Diar it has greater responsibility towards its wider stakeholders. For the purpose of this study focus will be given on two widely used strategic tools.
SWOT Analysis
PESTEL Analysis
SWOT Analysis of Qatar Diar:
SWOT which stands as an abbreviation of Strength, Weakness, Opportunities and Threats is a widely used tool to analysis an organisation’s current standing in the business environment.
It also looks into the future considering current competitions. This is a comprehensive planning tool where internally it focuses on strengths and weaknesses of an organisation at current state and looks into external impact factors in forms of opportunities and threats (Sadler, 2003).
http://www.lindsay-sherwin.co.uk/guide_managing_change/images/01_swot_1.gif
Figure : SWOT to Business Strategy (Sadler, 2003)
From both external and internal appraisal ‘Confrontational questions’ are generated.
For every single Opportunity – which strength element can assist the company to take advantage of the opportunity and which weakness can form a barrier to do so.
For every single Threat – which strength factor can lead to compete with the threat and which weakness can bound the company not to do so.
Following SWOT analysis examines Qatar Diar’s Strengths, Weaknesses, Opportunities and Threats considering its present scenarios.
Strengths:
Strengths of a business are all the positive elements that it do exceptionally well and generally are under its control. The strengths of a company gives it competitive edge over other business competitors. Often a company will emphasis on its strengths to reach to new dimensions. Below is a list of strengths for Qatar Diar.
Having associations with other robust and prevalent businesses around the globe is a major advantageous point for Qatar Diar as it helps bring in new clients and make business more operative. Qatari Diar since beginning have formed strong alliances in form of joint ventures with construction and management firms. In 2008 it signed agreements with Germany’s Hochtief; in 2009 signed agreement with Germany’s Deutsche Bahn to form the Qatar Railways Development Committee (QRDC). Under this committee, the Qatar Railways Company manages the expansion of Qatar’s $35bn rail system. In 2010 it joined with France’s Vinci Construction.
Being a market leader, as Qatar Diar is, is key to their success as it increases status, revenue and market share. Under Qatar Diar there are several key real estate development is ongoing which gives Qatar Diar additional advantage.
Innovation is a vital component of Qatar Diar’s overall accomplishment, as this retains them way above the other real estate companies.
Riding high in the niche market in Real Estate industry has helped boost Qatar Diar and raised reputation and turnover. It has so far focused on high end luxurious projects.
Not only they have ambitious projects in Qatar but also in several other countries with high profile construction work in prime locations. The US $1bn expansion of London’s past Chelsea Barracks is one such instance.
The establishments developed by Qatar Diar are sustainable modern, meaning this high valued clients will return to Qatar Diar for future projects.
Qatar Diar’s marketing strategy has proven efficiency. Which helped the company to raise profiles and profits and standing out as a major strength not only in gulf region but in the world.
Qatar Diar’s innovation keeps it a leader in Real Estate as it is frequently implementing new proprietary technology and design.
Experienced employees are key to the success of Qatar Diar helping to drive them forward with skill and knowledge. For example in March 2012 Qatar Diar appointed thirteen international law organisations to Qatari Diar’s six legal boards.
High quality machinery used in sites, experienced staff, offices and equipment guarantee the job is done to the utmost standard, and is a strength of Qatar Diar.
Qatar Diar has a widespread client base, which is a key strength regarding profit. Qatar Diar is spread in all over the globe in prime locations.
Being financially strong helps Qatar Diar deal with any problems, ride any dip in profits and out perform their rivals. Qatar Diar has state backing which helps them to stay strong in volatile market.
Qatar Diar has emerged as a strong brand which is an essential strength. Qatar Diar’s international operations establishes its authority over the business.
2012 World Cup will be held in Qatar. Before then the company will have some of their high profile projects finished which will enable them to capitalize the event.
Weaknesses:
Weaknesses of a corporation are things that should be improved for a better result; which are under their control. Weaknesses puts a business behind its competitors and create barrier to achieve its target. This section will present core weaknesses of Qatar Diar
Global economic crisis will have an adverse impact on the sales of high end products. As more and more people are trying to hold their money in safe investments. Qatar is yet not as promising as UAE which is first preference among many client.
Legal issues that buyers may face for the developments is still an issue for Qatar Diar as this creates barrier for potential customers.
Opportunities:
Opportunities are external deviations, drifts or desires that could improve the business or organisation’s strategic positioning, or which could be of a benefit to them. This section will summarize opportunities that Qatar Diar currently have.
Qatar Diar gets direct backing from Qatar Government which allows them to have additional support when they go overseas or even inside the country with grants and favourable policies.
Sudden change or adaptation of technology could give Qatar Diar an opportunity to strengthen future success. Use of social media network to promote its products to target markets may open new windows for them.
Qatar Diar is in respectable monetary position, which is an opportunity for them to explore in terms of investment in new developments.
Qatar Diar has the opportunity to enter niche market with their ever favourable government support to maintain leading position and therefore lift financial performance.
Grasping the opportunity to magnify the customer base is something Qatar Diar can aim for, either geographically or through new products. Qatar Diar has planned to take its innovative developments to other countries in coming time.
Qatar Diar can also explore takeover and merger opportunities could be explored for Qatar Diar and which later can be used to acquire new customers, new resources and enter new markets.
Threats:
Threats are reasons which may confine, harm or put areas of the business or organisation at jeopardy. They are factors which are external of the company’s control. Being conscious of the threats and being able to prepare for them makes this section valuable when considering contingency plans and strategies. This section will outline main threats Qatar Diar is currently facing.
Consumer lifestyle changes could lead to less of a demand for Qatar Diar products/services.
A slow economy or financial slowdown could have a major impact on Qatar Diar business and profits.
Rising costs could be a major downfall for Qatar Diar as it would eat into profit.
 
PESTEL analysis of Qatar Diar
In the macro environment there are many factor that affects decision making process of organisation. Changes can come in form of law change, trade barrier, impose of tax, demographic change along with government policy changes. These all are changes in the macro environment (Bennett, 2002). We can use PESTEL model to assess and analyse most of these factors. This arrangement differentiates between:

Find Out How UKEssays.com Can Help You!
Our academic experts are ready and waiting to assist with any writing project you may have. From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs.
View our services

Political factors. These factors denotes various government policy for example the degree of involvement in the economy. Which products and services the government wants to promote? Which areas will receive subsidy? Political factors can have tremendous impact on numerous important areas of business. It will determine how healthy the nation is and in terms of infrastructure how good it is i.e. road and rail network throughout the nation.
Economic factors. Economic factors includes but not limits to purchase interest rates, taxation charges, slow or high economic growth, inflation and exchange rates. To understand how it might affect a business with high impact let’s see the example:
– higher interest rates might discourage investment since it costs extra to borrow
– a strong currency may make exporting more problematic because it may increase the price in terms of foreign currency
– inflation may aggravate higher wage demands from employees and increase costs 
– higher national income growth may boost demand for a firm’s products
Social factors. Changes in social tendencies can influence on the demand for a firm’s products and the accessibility and readiness of persons to work. In Qatar Diar most of the workers are from different countries. If they cannot offer a competitive salary with other benefits there might be issue with finding right people. Also in 10 years’ time there will be Fifa 2022 World Cup in Qatar this might mean there will be additional interest for people to get involved and invest in properties.
Technological factors: new technologies generate new products and new procedures. Social networking, online shopping, online booking and computer aided design are all developments to the way we do business as a consequence of improved technology. Technology can lessen costs, improve quality and lead to innovation. These expansions can help customers as well as the groups providing the products. Qatar Diar has access to latest technologies in their work bases which helps them to minimize cost and maximize opportunities.
Environmental factors: environmental factors comprise the climate and environmental changes. Tourism industry can get hugely affected by temperature change or issues like changed climate. Due to global warming slowly there is significant environmental awareness which indicates that it is not a problem of a region. Qatar Diar also has implications of environmental factors. Sustainable growth will mean that there will be less scope for doing non-environmental friendly tasks. The recent trend of being more environmental friendly is something Qatar Diar can work on to build up campaign or similar movements which will be beneficiary for the business.
Legal factors: These factors are significant for a business in terms of the geographical area where they are based on. For example discriminations on the basis of age, sex, religion can have huge adverse impact on a business’s operation. Following laws of different country is also important as most of the time they does vary geographically. Also lawsuits can cost a company fortune. So having sound legal advisors are a must. Qatar Diar has an experienced panel of legal advisors to assist them with development planning.
Different categories of law that has direct relation with Qatar Diar includes:
consumer laws; these are intended to guard customers against biased practices such as ambiguous descriptions of the product
competition laws; these are designed at protecting trivial firms against oppression by larger firms and safeguarding customers are not exploited by firms with monopoly influence
employment laws; these cover parts such as dismissal, sacking, working hours and minimum wages. They aim to defend employees against the misuse of power by bosses
health and safety legislation; these laws are aimed at guaranteeing the workplace is as safe as is sensibly practical. This legislation covers important issues such as training, accident reporting and other provision for safety equipment.
Classic PESTEL features to ponder comprise:
Factor
Could include:
Political
e.g. Qatar government involvement in real state policies, investment agenda
Economic
e.g. inflation, credit crisis, national debt, exchange rates.
Social
e.g. view towards certain products, demographic characteristics, income
Technological
e.g. technological advancement, new ICT product, social networking, new product development by using new technology, rate of technological obsolescence
Environmental
e.g. global warming, climate change, natural disasters and other environmental issues
Legal
e.g. laws that company is abide by. competition law, health and safety, employment law
However, it is significant not to just list PESTEL factors as this does not in itself tell very much. What business strategic management team need to do is to work out which of the many listed factors may change. For example as a government holding company Qatar Diar will more or less have favourable policies from the government. Problem will arise when it goes to a different geographic location. Qatar Diar has a global portfolio that makes it challenging to take into consideration all the wider aspects of all its development activities.
In order to assess a big company like Qatar Diar it will be a good idea to distinguish between factors in terms of local, national and global (Drummond,2001).
For example, we can evaluate Qatar Diar’s PESTEL factors as:
Local factors such as designing a government project and its approval.
National factors such as government law regarding recruiting people for the construction.
Global factors such as entering into new market zones and its impact on business.
Conclusion:
This paper has looked into Qatar Diar’s business management from a strategic point of view. It is not long since the business was established. Getting world recognition in such a short time is really uncommon in today’s world. Qatar Diar has proved how innovative approach in real estate industry can shape its future. Strategically, Qatar Diar has been lucky to have state support throughout its operation. Thanks to its joint ventures it has seen its growth over 29 countries. In coming years Qatar Diar will reach to its peak and probably 2022 will be a milestone year for Qatar Diar.