Qatar is looking to Asia for foreign investment in a “new era” for the country, following the blockade by a number of major Arab nations in June last year.
Yousuf Mohamed Al-Jaida, the CEO of the Qatar Financial Center, a business and financial center located in Doha, told CNBC Friday that the country has moved to attract foreign investment by making it easier to get business visas and buy real estate.
“Qatar is looking for new partners, new alliances, so we are moving on,” he said.
“Our presence in Hong Kong speaks a lot. We’re going to be doing a lot of more tours in Asia, Thailand, Vietnam, within the next two months,” he added.
Saudi Arabia, United Arab Emirates, Bahrain, and Egypt imposed trade and travel bans on Qatar in 2017, blaming the country for supporting terrorism.
The Qatar Financial Center, which aims to foster investment in Qatar, has been explaining to foreign investors that, after the deterioration of relations between Qatar and other Arabic countries, the country has been putting forward a slew of reforms to adapt to a “new reality.”
“The appetite is good, I think we have to do a lot more of awareness as to what the blockade means. What we are trying to pitch in terms of the blockade is that this is a new era for Qatar,” Al-Jaida said.
Qatar’s economy has proven its resilience and continues to perform well amid the blockade, improving local liquidity and gaining the confidence of international investors, said Doha Bank CEO Dr R Seetharaman.
“The blockade (on Qatar by a quartet of nations) came as a rude shock to us. But Qatar has withstood… it has proven to be a resilient model. Qatar’s economy was performing around 2.5% last year.
This year we are not expecting less than 3.1% growth,” Seetharaman told Gulf Times in an interview.
He said Qatar improved local liquidity by disinvestment last year.
“If you look at Qatar economy, liquidity was under stress to start with. The government improved local liquidity. Now international investors have reposed confidence in Qatar. The banking system as a whole is improving.
“The loan to deposit ratio in the Qatari banking system has significantly improved and now stands at 112%. This is an improvement of the level, immediately post blockade, which was at 116%.”
Qatar’s banking sector had witnessed credit expansion of around 9%, the deposit book has grown of more than 10.4%, he noted.
He said in the days that followed the blockade, there were challenges in terms of international investors slowing down on Qatar.
“They were concerned about the Qatar economic momentum. Even the rating agencies looked sceptical, which explains the negative outlook on the sovereign.”
But, Seetharaman said, Qatar’s ‘AA’ rating, which is still very high, has not been challenged although the international rating agencies have changed the sovereign outlook to negative. The high rating (A) of Qatar’s banks is also not challenged.
Currently, Qatar holds Aa- by Fitch, AA- by S&P and Aa3 by Moody’s.
“With strong exports, positive economic outlook, and natural gas markets unaffected by the economic blockade, the overall growth for Qatar remains sustainable,” Seetharaman noted.
The International Monetary Fund (IMF) in its latest World Economic Outlook revised up its forecast for world economic growth in 2018 and 2019, saying sweeping US tax cuts were likely to boost investment in the world’s largest economy and help its main trading partners.
Seetharaman also said new global forecast has a 3.9% growth this year and next. The advanced economies are expected to grow by 2.3% in 2018 and 2.2% in 2019.
The emerging and developing economies are expected to grow by 4.9% in 2018 and 5% in 2019.
India is projected to grow at 7.4% of its gross domestic product (GDP) in 2018 making it the fastest growing economy among emerging economies following last year’s slowdown due to demonetisation and the implementation of goods and services tax.
China, which is spearheading the ‘Belt and Road’ concept is expected to grow up to 6.6% this year, he added.
DOHA: With Qatar having the world’s third largest gas reserves and being India’s largest supplier of liquefied natural gas (LNG), both countries are expected to give a fillip to cooperation in the hydrocarbons sector .
Qatar has gas reserves exceeding 900 trillion cubic feet (25 trillion cubic metres) or 14 per cent of global reserves. It is the largest LNG exporter in the world.
The Gulf Cooperation Council member accounted for 65 per cent of India’s total LNG imports last fiscal.
India is also hoping to tap the Gulf nation’s sovereign wealth fund, estimated at $300 billion, for infrastructure projects.
Prime Minister Narendra Modi , who is visiting Doha on the second leg of his five-nation foreign tour, praised the role of the Emir of Qatar in promoting business ties with India.
Modi on Sunday also invited Qatari industry leaders to invest in India.
“India is a land of opportunity. I have come to personally invite you to take advantage of this opportunity,” Modi said, according to a tweet by India’s Ministry of External Affairs (MEA) spokesperson Vikas Swarup.
“Business First. For first engagement of the day, PM attends roundtable meeting with Qatari Business Leaders,” the spokesperson said in another tweet following Modi’s meeting here with business leaders.
“Qatar’s Minister of Trade and Economy welcomes PM Narendra Modi, seeks more intensive eco engagement with India,” it added.
This is the second prime ministerial visit from India to energy-rich Qatar in eight years after Manmohan Singh’s visit in 2008.
“It can also be a large economic partner as it has a large sovereign wealth fund,” Foreign Secretary S. Jaishankar said on Friday in a pre-departure media briefing.
Bilateral trade between India and Qatar stands at $10 billion.
Earlier this year, India re-negotiated favourably its LNG agreement with Qatar to bring down the cost of importing natural gas to less than $5 per unit from $12.
In return for the renegotiation, India’s Petronet LNG has signed an agreement for additional import of one million tonnes of LNG per year from Qatar’s Ras Gas for about 12 years with effect from January 1, this year, at the prevailing market prices.
Ras Gas will also not seek Rs.12,000 crore from Petronet for under-lifting LNG by 38 per cent.
The new contract is effective from January 1, 2016, and ends in 2028.
Modi addressed Indian workers at a medical camp in Doha on Saturday night. There are 6,30,000 Indians living in Qatar comprising the largest expatriate community in that country.
Modi, who arrived here from Afghanistan, will also visit Switzerland, the US and Mexico during his seven-day sojourn.
Promising $10 billion in credit to Africa to back a “partnership of prosperity” and pitching a broad alliance for global reform, Prime Minister Narendra Modi called for a permanent solution to the food security and agriculture subsidy issues at the Nairobi WTO meet, to be held later this year.
Addressing the inaugural session of the 3rd India-Africa Forum Summit (IAFS), Modi also made a strong pitch for deeper India-Africa ties in key areas of counter-terrorism, climate change and UN reforms. His nearly half-an-hour speech at the session was attended by 41 heads of state and government, including Presidents Jacob Zuma of South Africa, Mohammadu Buhari of Nigeria and Abdel Fattah al-Sisi of Egypt,t and hundreds of senior officials from 54 African countries.
He said India and Africa also seek a global trading regime that serves development goals and improves trade prospects. “When we meet at the Nairobi Ministerial of the WTO in December, we must ensure that the Doha Development Agenda of 2001 is not closed without achieving these fundamental objectives.”
The WTO’s General Council had accepted India’s demand for extending the peace clause till a permanent solution is found for its food stockpiling issue. For a permanent solution to the food security issue, India had proposed either amending the formula to calculate the food subsidy cap of 10%, which is based on the reference price of 1986-88, or allowing such schemes outside the purview of subsidy caps. If no solution is found by the agreed deadline of December 31, the peace clause will continue till the time a solution is found.
Calling for stronger ties in the strategic areas of counter-terrorism and climate change as well as on UN reforms, Modi told the visiting leaders, “We will raise the level of our support for your vision of a prosperous, integrated and united Africa that is a major partner for the world.”