Banks in Qatar continue stable thanks to continued high government spending which is making up for low oil prices, according to a report by Moody’s Investors Service’s. The study, published this month of July, reflects how bank creditworthiness will most likely evolve in Qatar over the next 12-18 months. It is worth noting that the agency’s rating for Qatar banks remains unchanged since 2010.
Although the country’s growth remains the highest in the entire GCC region in terms of GDP, it has slowed considerably over the last few years, going from extremely high rates, around 13.4 per cent in 2006-2014, to a growth of 4.1 per cent predicted for 2016.
However, despite the overall resiliency of the operating environment, banks in Qatar are still likely to face funding shortfalls as a result of continued credit growth, compounded by a sizable reduction in deposit inflows from the government and related entities due to lower oil prices.
To compensate the funding gap there are several interesting schemes for investors:
The Special Economic Zones created under Law No. (34) of 2005 are free investment zones designed to encourage and attract investments in the industrial, agricultural, technical and tourism fields, and any other field decided by the Council of Ministers.
Currently there are two special economic zones. The first, Ras Bufontas, is adjacent to Hamad International Airport, and caters for investment sectors such as Healthcare & Medical Devices, Aerospace & Automotive, Advanced Technology, Logistics, and Business Services.
The second, Um Alhoul, is adjacent to Hamad Port, and caters for investment sectors such as Marine Industries, Logistics, Electrical & Machinery, Food & Beverage, Construction / Building Materials, Metals & Materials, and Downstream Petrochemicals
Underway is a third special economic zone planned for future development called Al Karaana, which will be located closer to the Kingdom of Saudi Arabia border.
Qatar also enjoys Logistics Parks aimed at creating a modern environment suitable for supply and storage services to provide investment opportunities. These primary projects and their infrastructure have prime locations with access to an integrated water, electricity and road network, so as to provide warehouses and workshops for the processing and assembly, commercial showrooms for goods and products, and options for a variety of offices and workers accommodation.
Finally, there is a Warehousing Project that offers a prime location for logistics parks comprising of small and medium warehouses and adjoining support facilities. The four land plots of this project were tendered out to potential developers whereby the facility is designed, constructed, operated, and maintained by a private partner.
María Arcenegui Siemens