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Qatar’s Diversification Challenge HE Sheikh Hamad bin Jabor Al Thani Director General

Qatar’s Diversification Challenge HE Sheikh Hamad bin Jabor Al Thani Director General. General Secretariat for Development Planning State of Qatar November 2009. Outline. Facts Development Trajectory Changing Course Rationale for Diversification Challenges

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Qatar’s Diversification Challenge HE Sheikh Hamad bin Jabor Al Thani Director General

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  1. Qatar’s Diversification ChallengeHE Sheikh Hamad bin Jabor Al ThaniDirector General General Secretariat for Development Planning State of Qatar November 2009

  2. Outline • Facts • Development Trajectory • Changing Course • Rationale for Diversification • Challenges • New Framework for Managing Development • Operational Directions • Focus Areas • Doha Economic Forum • End

  3. Facts • 61%: Direct contribution of hydrocarbons (oil, LNG, GTLs and condensates) to nominal GDP in 2008—excludes downstream activities that use feedstock • 61%: Hydrocarbons’ revenues contribution to fiscal revenues in FY 2008/2009 • -10.8%: Non-hydrocarbons fiscal deficit in 2008/2009. • 91%: Hydrocarbons’ export earnings share in 2008. • -20%: Non-hydrocarbons current account deficit in 2008

  4. Development Trajectory • Qatar’s has put its hydrocarbons to good use • investments along the hydrocarbons supply value chain • investments downstream • financial investments of surplus funds in assets overseas • efforts to build broader economic base (QFC, QSTP, ICT Qatar, Qatar Foundation, new industrial cities and economic zones, and other ventures) • investments in education reforms and improvement

  5. Changing Course • Longer-term market prospects are uncertain • Alternative sources of supply and new technologies (e.g. shale) • Links of gas to oil prices (recent uncoupling) • Prospects for demand (carbon reduction initiatives) • Geological constraints (moratorium on North Field) • Hydrocarbons will remain important • Qatar is low cost producer • Opportunities to diversify horizontally and vertically • New sources of sustainable wealth creation needed • New arrangements needed to manage development in an uncertain, complex world

  6. Rationale for Diversification • Bonus to long-run growth • Lower volatility and lower country risks • More and more productive jobs in private sector • Fiscal and balance of payments sustainability - Otherwise, Qatar will eventually endure painful adjustments -

  7. Challenges • Managing economic volatility • Husbanding hydrocarbons wealth for future • Creating a climate to support vibrant private sector • Investing in technocratic, scientific, management and entrepreneurial capabilities • Building institutions

  8. New Framework • Vision: Qatar National Vision clarifies aspirations and ambitions • Strategy: Qatar National Development Strategy will identify priorities and agenda over the six years period 2011-2016 • Reforms: National development priorities will be integrated with each other and to public financial and budgetary reform • Execution: Focus on implementation readiness and outcomes • Capabilities: Investments in institutions, policies and regulatory mechanisms • Partnerships: Critical role of private sector and civil society

  9. Operational Directions • Leverage existing advantages in hydrocarbons and energy • Strengthened private sector focus • Leverage regional cooperation (expanding markets, deepening connectedness and sharing infrastructure) • Invest in people and relevant skills • Acquire knowledge, technology and invest in innovation capabilities • Create world class infrastructure

  10. Focus Areas • SMEs and Enterprise —new development agency in formation stages; QDB undergoing restructuring • Knowledge based business —identification of market opportunities in knowledge value chains • Public-private partnerships —newlegislative and regulatory frameworks, new approaches to infrastructure planning and funding • Space for private sector (procurement, outsourcing, privatization) • Investment climate and competitiveness: • access to serviced land; • strengthening framework for secured transactions; • reducing regulatory barriers and costs; • promoting competition • Infrastructure • Economic management

  11. Doha Economic Forum First Doha Economic Forum sponsored by GSDP and the World Bank: “Economic Diversification in the GCC: Meeting the Challenges” 9-10th February 2010 Contact: fharrigan@planning.gov.qa

  12. Qatar National Vision 2030: Engaging Stakeholders in the National Strategy Thank you

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