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Thursday, April 23, 2015

Qatar spending spree

Qatar is a small gulf country with vast oil and gas reserves. The export of oil and gas has led Qatar to enjoy highest per capita income in the world. 

The government is in the hands of Al Thani family who are governing Qatar as hereditary state since its founding.  The Government of Emir Shaikh Tamim Bin Hammad Al Thani provides subsidies to its people on almost everything from health care to education.

 Owing to huge subsidies, Qatar has not seen Arab spring. Rather it funded the rise against Arab monarchs some of whom were governing for many decades. The funding of Arab spring has now backfired and it has to put an end on its spending for its expansionary plans.

Still Qatar has other options to spend her shale money. The preparations for FIFA football worldcup in 2022, is an outlet for the government to bankroll the projects in order to successfully hold the event. The total expenditure on these projects is planned to be in excess of 200 billion dollars. Regional business intelligence specialist MEED has predicted that Qatar will see $30 billion worth of new infrastructure projects through 2015 alone.

Unlike other Gulf countries like Saudi Arabia and UAE, Qatar has not seen slow down in mega projects due to fall in oil prices. This has been said by Abu Dhabi Commercial Bank in a report showing the mixed impact of cheap oil on the Gulf.

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