QATAR - Economy
Country Senior Partner, PwC
Bassam Hajhamad is the PwC country senior partner and consulting leader for Qatar, working closely with major public and private entities. He has 20-plus years of experience in management consulting, digital/ICT, and private equity, covering North America, the Middle East, and Africa. His areas of expertise include corporate strategy, digital policy and transformation, national localization and privatization, and investment management. He is an active member of the World Economic Forum (WEF) Digital Economy and Policy initiative. He holds an MBA from MIT Sloan School of Management and a master’s of science in computer information systems from the University of Detroit.
What main trends will bring diversification to Qatar?
We have seen faster decision-making and key strategic initiatives in Qatar over the past few years, and, despite the geopolitical situation, there is a great deal of momentum in the market today to create a more self-sustainable Qatar, especially in terms of who it trades and partners with. Qatar is working on diversifying its economy away from oil and gas. The first push for diversification comes from the new taxation policy, including VAT. Upon successful completion, we expect VAT to generate a good source of revenue for the country and result in positive spillover effects for the wider local economy. Second, we see huge potential in localization. Localization has also been supported by public procurement policies and by incubating local SMEs, including through Qatar Development Bank. One of the most sustained efforts has come from Qatar Petroleum (QP), particularly through its new Tawteen program, launched in February. It aims to add at least QAR8 billion a year in value to the economy, create thousands of high-skilled white-collar jobs, and help to develop SMEs. The third pillar is privatization to generate FDI and sustain local economies. We have started to create a framework for governments to subsidize small private investments so that small enterprises will feel comfortable and safe to invest. The fourth features digitization programs, such as digital economies and the “Smart Qatar” program. We have been working with local entities on developing and implementing Qatar digital strategy, including different initiatives and programs around the digital sector to enable new sectors to use digital platforms. The fifth pillar is internationalization, which we see a great deal of now. QP, Qatar Airways, Qatar Foundation, Qatar Investment Authority (QIA), and many others are becoming more of an international brand, and, alongside that, are forming stronger trade agreements and new external partners.
How do you assess the impact of the new legislation to attract FDI?
Some 49% of FDI in the GCC is from the state. Since the new law, the government seeks to attract more FDI from private entities, especially by permitting 100% ownership, which is what most GCC countries are trying to do. Recently, in order to boost this initiative, we created a portal specifically for investors. It is a single-window system, which makes it easy and simple for people to find opportunities and buy real estate. To deliver these core capabilities, one needs talent and strong enablers around building talent. We see many discussions between our clients about leadership development and training at a senior level. Other enablers are more about funding mechanisms, and we have started to create easier ones. With PPPs, we have created a system of national investors that will step in and grant access to funding, which will enable those pillars to develop.
What opportunities do you see coming up, especially in light of the 2022 FIFA World Cup?
The World Cup will give Qatar greater recognition as a brand and a hub for sports. However, this is an area where we can do much more. We are now focused on beyond 2022 and what more can be done to make Qatar a global sports capital. There is also room for industrialization, which means creating local manufacturing or plants. Here, the challenge is on the demand side. We have 10-12 sub-sectors we could focus on, though we chose only some. Qatar is good in choosing a few things and making them gold. The soccer team is full of superstars, QIA is one of the biggest sovereign wealth funds in the world, QNB is the biggest bank in the Middle East, and Qatar Airways was named the best airline in the world. If we continue with that mindset and build new trade agreements, while focusing on the next few big things—and the World Cup or sports in general could be one of them—it will create a key branding position.
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