In this Digital Roundtable we looked at how the pandemic is accelerating digital transformation, how the finance sector is adapting, and the support the public sector is providing to ensure continuity.

Abdul Salam Knio
Managing Partner
Information and Communication Technology W.L.L.
Matthew Heaton
Head of Office, Head of Banking & Finance - Qatar
Al Tamimi & Company
Craig Dunleavy
Country Manager
Devere Group

Moderator: Han Le, Managing Director Latin America for The Business Year


Matthew Heaton, Head of Office and Head of Banking & Finance - Finance Qatar, Al Tamimi & Company

Abdul Salam Knio, Managing Partner, Information Communication Technology W.L.L

Craig Dunleavy, Country Manager, Devere Group

HAN LE: Good afternoon everyone. I am Han Le of The Business Year and I would like to welcome all of you to our discussion on the challenges and opportunities brought on by the COVID-19 pandemic in Qatar, particularly within the financial, legal, and digital spheres. We have three esteemed guests with us today speaking on these issues. It is my pleasure to introduce Craig Dunleavy, Country Manager for the Devere Group in Qatar, Matthew Heaton, Head of the Qatar office and Head of Banking and Finance at Al-Tamimi & Co, and Abdul Salam Knio, Managing Partner, Information Communication Technology. Qatar has not been immune to the disruptions caused by the global pandemic; however, Qatar has proven its ability in recent years to weather external shocks and in fact thrive under these conditions. Still, this is perhaps its toughest test yet, and any discussion about the current realities for the country should begin with the government's massive stimulus response package to deal with it. This includes a QAR75-billion stimulus package, a number of policies aimed at alleviating pressure on the financial sector, and utilizing the country's digital infrastructure.

Mr. Heaton, I would like to start with you to begin our discussion. What are your thoughts on the government plan, thus far, two months along? How have these measures impacted the private sector? What have been your clients most pressing concerns, how well these metrics so far, measure up to alleviating these concerns?

MATTHEW HEATON: The Qatari government acted quickly and decisively in terms of providing support to the private sector. In contrast to some governments in certain jurisdictions, the Qatari government identified the need to support the private sector and thus made available a series of packages quite rapidly. There was the formal financial package that has provided support to Qatari companies with guaranteed loans to pay salaries for the short term. There's also been support for rent payments in particular sectors, for example retail. The initial round of packages did not extend to companies in Qatar's financial sector, though that is being addressed. That said—and this is the same in countries around the world—the unprecedented impact of COVID-19 and the speed with which everything has happened has meant our clients and most entities operating in Qatar have had a profound and sudden impact. In terms of some of the softer concessions and support, the government has been deferring the renewal of commercial registrations, and GTA has announced there will be no penalties for late payments of taxes and returns. There's also been some guidance around employee rights so employers know what they are able to do, and there is greater clarity and guidance both for employees and employers. The overall observation is that the government has been fairly agile and flexible because it has provided formal packages of support as well as guidance and softer support as issues arise.

HL: I want to pass this on to Mr. Dunleavy as well. How have you seen the financial sector impacted by all these, and what is your assessment of how much longer it can hold up under these circumstances?

CRAIG DUNLEAVY: I very much echo what Matthew just said there in what Qatar has done to make sure we can sustain business here and ride this through. The bottom line is not just Qatar; the rest of the world needs us all to return to business and keep the economy flowing. I very much compliment the government's moves to ensure we continue doing that as quickly and without as many hiccups as possible. I always get an interesting view because we have many clients in many different sectors, and we get to talk to them and find out what is going on for them personally and in business. Many of the businesses here are continuing as normal. Some people are adapting to working from home. Many companies have come up with routines or schedules where they can bring staff into work, but with skeleton schedules or split into teams that come in on alternate days. The government has put many packages in place to keep the economy flowing here and acted swiftly. Qatar is very much in the mindset of acting swiftly.

HL: The theme of adaptation leads us directly to the area of expertise of Mr. Abdul Salam Knio, who has been working in the digital transformation of Qatar for many years now. And even before this pandemic, this has been a major issue and policy goal for the country. Mr Abdul Salam, how would you assess Qatar's existing digital infrastructure and the preparedness the country to handle this pandemic?

ABDUL SALAM KNIO: Indeed, the Qatari government, as part of the country's Vision 2030 and measures thinking before the pandemic, was ready to move from a traditional economy to a digital one. That definitely helped us to address the pressing pressure of COVID-19 now. When talking about readiness, we mean readiness from different perspectives. One could be technology readiness. The Qatari government has committed to having a cloud infrastructure and cloud regulations in Qatar, allowing organizations to move to the cloud, which provides a more elastic and sustainable business model, moving forward. It also built a national cybersecurity center in order to have greater visibility on cybersecurity threats of digital communication between organizations, individuals, and countries. This is an important aspect when depending more on the digital economy. We need to make sure we are transacting securely and legitimately. The readiness also covers the people and culture. There were many initiatives that the government and the private sector took in different areas. Qatar Petroleum came up with the Tawteen initiative, which was there before COVID-19. Tawteen is a digital initiative to cover the future expectations of the oil and gas sector. There is another smart initiative from the government called Tasmu, and we are heavily involved in this initiative to provide the digital and smart infrastructure for the government. There is another initiative called e-health for the health sector to automate and move the health sector from a traditional business model to a more digital and data-driven one. That readiness was there and moving at a fair pace, and the COVID-19 outbreak in fact boosted those activities. As the other gentlemen have mentioned here, there is a greater dependency on electronic services. In retail, we have seen an increase in online shopping and deliveries. We have also seen online education for schools and universities being quickly implemented and effectively working. In the banking sector, we have seen wireless card management and adjustments to credit limits and allowances in order to provide safe banking services. All banks have extended their services using mobile apps and services. The government of Qatar has also added a new set of digital services on its app. All these have helped citizens to continue effectively and be productive in these exceptional circumstances with the maximum productivity and greater dependency on digital channels and safety. We are lucky to be in Qatar because Qatar has been prepared for this as part of a strategy and vision from Qatar 2030. So, we are now using a business infrastructure that was created before COVID-19. However, there is no doubt COVID-19 has pushed many organizations, especially SMEs, to develop digital strategies and have a serious business sustainability discussion moving forward.

HL: Qatar's recovery after this pandemic will also test the country's judicial and arbitration systems. Mr. Heaton, how would you assess, all things considered, Qatar's judicial ability to handle the heavy workload that is sure to and keep the recovery moving along?

MH: There are two jurisdictions in Qatar, not everybody is aware of this. There is the capital financial center and the state laws of Qatar. The Qatar Financial Center (QFC) has a great deal of capacity in terms of courts and arbitration and has been pushing itself as a center for settling disputes. It relies heavily on expertise from different jurisdictions for particular transactions so to the extent that there are cases brought in the QFC then one would expect that the combination of the capacity, because it is still a relatively young court, and its access to experts and judges from different disciplines will provide it with a strong base to push forward. Over the last few years, the general judicial system outside of QFC in Qatar, because of the rapid diversification of the economy and the enormous increase in industry and commerce generally, has had exposure and experience for far broader range of transactions than it would have had if the situation had happened a decade ago. One of the plus sides that the judiciary has going for it is because of the massive amount of infrastructure in Qatar over the last five to 10 years. A significant amount of litigation and arbitration has flowed out of that as a consequence of all this. This has given the judges and the courts a great deal of experience that will come in handy when there is the inevitable increase in litigation coming out of the COVID-19 situation.

HL: Mr. Dunleavy, what about digitalization within the finance sector? A report from the Devere Group cited a 72% increase in fintech activity in Europe; what are you noticing already in Qatar?

CD: Already, we have seen a huge surge in things like e-signatures. I always saw the industry as slightly old-fashioned when it came to things like this. We have clients in Qatar, but we deal with institutions all across the world, and these things truly depend on where they will be in the future as to solutions or products that they may have in place. It has always been the old-style traditional method of signatures, shaking hands, and doing business or giving advice that way. We have seen everyone on board, much like Matthew was saying in regard to a major shift toward things such as e-signatures we have seen from financial institutions. It is all about making sure the world can continue because it needs to. Who knows how long we will be in the position we are in. Who knows how long we will be doing these circles over Zoom? Perhaps it will work so well that we will continue doing that afterward. The point being the world needs to find a way that we can all continue. The moves made by clients in Qatar have been swift and have made an impact because the clients I deal with are still confident enough to plan for the future to put money aside to invest. The way that the world is adapting allows them to still do that, which is great. From a business perspective, it also allows us all to save more on costs. I feel sorry for DHL in this time because it is suffering like many other industries are; however, many businesses like ourselves are learning that in fact some positive things have emerged from this, and there are some things that we could perhaps take into the future and keep.

HL: I would like Mr. Abdul Salam to expand on a comment you made regarding digitalization for the long term. What needs to be done in terms of creating sustainability in the digital transformation of the economy?

ASK: That is an important question. Today, traditional business models are against what we call digital disruption. Currently, around 40% of the Fortune 1000 Companies 10 years ago are still in the top 1,000 companies today. Some 600 organizations that were top in the whole world either lost their rankings or folded completely. It is therefore important for all organizations in Qatar and the whole world to create a digital business strategy as part of the DNA of their businesses and to re-evaluate their business models. Even if it has proven to be successful for many years, it does not mean it will continue to be successful in this digital challenge or digital disruption. In order to sustain a business model and the legacy of business that have been developed over the years, it is important for the leaders in all organizations to, first of all, understand the opportunities and the threats of the digital economy. You need to be a current believer and invested in the future in the digital economy, and inject new knowledge and create new business processes and innovation. Innovation management is not covered well in many organizations. With more automation and dependency on technology, the role of people becomes more about innovation and creativity, and that is an important factor to use as a capital or resource in any organization. Such a culture if created will create a sustainable business model for the future and a robust model that can resist disruptions such as the COVID-19. Technology offers a wide set of solutions and technologies that can enable those discussions that I amm talking about—a sustainable elastic business model. When we say elastic, cloud comes to the picture, because by moving to the cloud, one pays as they go. When using a subscription or consumption-based model, when one's business shrinks, their investment and overheads fall, and when business grows, then they pay more, which is natural. The cloud offers businesses today an infrastructure and technology or business infrastructure that offers such elasticity. Business sustainability also can be addressed from an environmental perspective. Today, technology could be a solution as well as a burden to the environment, if not well planned. Multiple factors in the new digital economy, such as political, environmental, legal, and social, combine the parameters for a good sustainable business model moving forward. In addition, the expectations of customers and users of the economy today are much higher than previous generations. Today, it is extremely important to not only embrace the digital economy but also compete in it. Classical businesses, or those with a giant infrastructure, would be a challenge with the digital agility provided by technology today.

HL: Based on what you are seeing now, what long-term impacts do you see this pandemic having on the economy and businesses, even after the pandemic is over?

MH: The COVID-19 situation has pushed many businesses further down the innovation and transformational route than they otherwise might have gone. In the legal industry internationally, there is a massive investment in legal technology in terms of automation and trying to make the delivery of legal services more efficient and ultimately cheaper for clients. There has been a push over the last decade to encourage that, though it has been accelerating more recently. There will also be a more fundamental analysis of the business model both of law firms and generally—how much office space does one need? People have shown they can work from home efficiently and effectively. Do offices need desks for 50 people, or do they need meeting rooms and more flexibility? Because there has been so much immediate pressures on cash flow, when we come out of this, people will have a long hard look about all aspects of that business model.

ASK: Technology is part of everything we talk about today. In legal, for example, we will see more of regulatory technology or reg tech. The technology will be able to validate and verify compliance automatically. We will see fintech projects inbuilt with reg tech, and sometimes property technology, or prop tech, for real estate. All those legal issues or methods related to financial services and real estate, legal and governance, can all be addressed effectively in real time with technology. We will also see more AI and predictive analysis taking more of a lead. We will see more of smart cities, buildings, assets, and so on. And, more importantly individuals today are becoming much more aware and much more enabled, with tools that help them be more creative and innovative for a better future. The technology is promising. In order to benefit fully from the technology, we need to realize the importance of education. We need to upskill the education system as a whole to be more ready for the digital economy. With innovation and great ideas, people can create new business streams. Unleashing that innovation as part of this society is of key importance for the future.

CD: There are many unknowns that we are dealing with at the moment. In commercial real estate at the moment, there is a lot going on. Oil prices have fallen, and we need to get back into the swing of things and move forward to truly understand the impact and the sectors that will return to normal. There will be many hotels in Qatar that will struggle. When everything returns to normal, will there be a big surge there boosted by the fact that people have missed those luxuries and want return as quickly as possible to their old lives? Will people think about how much money they saved during the lockdown and think more about saving more? I hope spending around the world returns to normal, I hope economies start flowing again, and I hope the markets bounce back strongly. As a financial advisor, I have accepted that one cannot control the markets, and we have to prepare ourselves to adapt to developments, be sensible, read as much as you can, and put in plans in place for A, B, C, and D. If anything, this has shown that we need plans for E, F, and G right down to Z. It will be interesting to see what happens when we return. There are so many things we cannot control there. We work on the things we can control and just be sensible and understanding that the world can throw some curveballs and we need to be in place ready to adapt.