I am in Qatar for my company www.trading-champions.com. I think of few better places in the world to combine opportunity for business (it is the world’s richest country GDP per capita) and quality of life – office to pool in 2 minutes and commute times under 10 minutes to meetings!
One of the most positive consequences from the GCC Crisis has been the Qatari government’s efforts to attract more investment. The Qatari government has always been open to foreign direct investment, but the blockade changed the equation.
One of the most significant steps toward attracting foreign investment was the Qatari government’s decision to create so-called “Free Zones.” Created in 2018, these Free Zones were designed to offer a “positive economic ecosystem in which businesses can thrive.” In practice, this means that the Qatari government has offered significant incentives for foreign companies to develop a footprint in its Free Zones while also incentivizing domestic investors to expand internationally.
Some of the incentives include quality infrastructure (like state-of-the-art office facilities), potential access to a $3 billion government-backed investment fund, 20 years of corporate tax holidays, and joint ventures with national champion companies. Qatar’s Free Zones are located in two strategic locations. The first (Ras Bufontas) is a free zone that is located only six kilometers away from Hamad International Airport.
The second (Umm Alhoul) is a free zone located near Hamad Port, which is the world’s largest Greenfield port. These free zones’ proximity to world-class transportation hubs offers a wealth of resources and connectivity, thereby increasing the odds of success for these ventures.
In addition to the establishment of Free Zones within Qatar, the Qatari government has created a $2 billion incentive program for foreign direct investment. According to Yousuf Mohammed Al Jaida, the CEO of the Qatar Financial Centre Authority, the Qatari government is looking to incentivize nearly every single industry for foreign investment. That said, some specific sectors that appear intriguing include financial services, Islamic finance, FinTech, sports, media, and digital. The incentive program has already shown extremely encouraging signs, as there was a 66 percent increase in foreign direct investment in 2018—despite the ongoing blockade.
As part of these efforts to increase foreign investment, the Qatari government has also embraced legal reforms within the country. One of the most significant recent laws is the new law n.1 of 2019. This law, also called the new Qatar Foreign Investment Law, opens to foreign individuals and companies the chance of directly investing in almost all Qatari economic sectors. Before the enactment of this law, foreign companies or individuals wishing to invest in Qatar needed to form a joint venture with a local partner or sponsor.
Now, Qatar is going to be one of the most open states to foreign investment in the GCC. Except for a few industries (like banking, insurance, and security and defense), foreign investors have a significant amount of freedom to seize new opportunities in Qatar.
Some other reforms within the past two years have included a permanent residency plan, where residents in Qatar will be able to gain the equivalent of a Green Card. In addition to these legal reforms for foreign investors and multinational corporations, the Qatari government has also instituted other rights reforms. For instance, some of those reforms have included a law allowing migrant workers to leave Qatar without permission from their employers. The Qatari government has also announced plans to establish a minimum wage for migrant workers and a “Worker’s Support and Insurance Fund” that would ensure that workers are paid overdue wages.
Alpesh Patel
www.trading-champions.com
