June 14, 2024
Investment

Invest Qatar sees big role for logistics sector, World Cup spurred investments


PARIS — Qatar’s logistics sector is playing a key role in the country’s economic growth, says the chief executive officer of Investment Promotion Agency Qatar, also known as Invest Qatar.

“One of the main tailwinds for Qatar is its strong logistics sector, which plays a crucial role in the country’s sustained growth and planning efforts,” Sheikh Ali Alwaleed Al-Thani told Al-Monitor.

Thani noted that the Gulf country ranks seventh globally in logistics competence in Agility’s Emerging Markets Logistics Index and the Qatar Free Zones Authority is “a key enabler” by hosting top global logistics enterprises and incorporating innovative technologies like AI.

“These initiatives enhance Qatar’s logistics infrastructure, attract new market entrants and solidify its position as a global logistics leader,” he added.

Qatar’s freight and logistics market in 2024 is worth $9.5 billion, according to Mordor Intelligence, and is projected to grow to $13.49 billion by 2030.

The country is home to Qatar Airways Cargo, which is one of the largest freight airlines in the world, which is helping drive growth in the logistics market.

After the United States, Qatar is the second largest liquified natural gas exporter in the world, meaning that its logistics market has had to grow with it. Qatar’s logistic market is one of the country’s fastest growing at 26% in 2022 off the back of the COVID-19 pandemic.

He said a notable headwind globally was a fierce competition to secure talent, given a tight labor market, as well as highly challenging projects that require a lot of manpower. Labor shortages have significantly impacted the logistics industry and have contributed to high costs in shipping and transportation, according to Invest Qatar. To attract and retain talent, Qatar has implemented strategies such as the Mustaqel visa program, designed to lure in international talent and bridge workforce gaps. 

“These multifaceted efforts underscore Qatar’s proactive approach to maintaining its competitive edge and fostering long-term economic stability,” Thani added.

The International Monetary Fund in April projected Qatar’s gross domestic product to grow 2% in 2024 and 2025 and then accelerate further in the following years (5.8% in 2026 and 7.5% in 2027). According to the World Bank’s Spring 2024 Gulf Economic Update, economic growth in the GCC region is expected to rebound to 2.8% in 2024 and 4.7% in 2025. 

Discussing these figures, Thani said, “This anticipated recovery is not solely reliant on the hydrocarbon sector but also is being driven by the robust expansion of the non-oil economy.” The World Bank Spring 2024 Gulf Economic Update said that GCC non-oil growth in 2024 grew 2.4%, driven by the region’s growing tourism sector.

The CEO stressed that he did not see investment attraction to Qatar as a zero-sum game and that growth in the GCC is also good for Doha.

“GCC countries, through enhanced intraregional trade and global economic integration, are actively reducing trade barriers, upgrading trade infrastructure and diversifying their economies,” Thani said, adding that Qatar is constantly looking for opportunities for multinationals to establish their presence in the country and the wider region.

“This is made possible through a rigorous reform agenda, a business-friendly environment, robust financial institutions and a synergistic range of resources that together form an empowering and business-friendly climate for foreign investors,” he added.

Thani said that Qatar’s stable economy, access to natural resources and talent and knowledge ecosystem were some of the draws for foreign investors. He added that the country had the first commercial 5G network in the world, contributing to strong digital infrastructure.

Since Qatar hosted the 2022 FIFA World Cup, Thani said the country — and the Middle East’s — profile had grown in attracting investment and in changing perceptions of the region.

He added that the tournament has expedited the development of a knowledge-based economy, including through the growth of Qatar’s tourism sector in line with Qatar National Vision 2030. 

The Gulf state’s third National Development Strategy 2024-30 targets accelerating economic growth to an average of 4% annually until 2030 and to bring inward foreign direct investment to $100 billion.

In 2022, Qatar attracted nearly $29.1 billion of inward foreign direct investment, with a total of 135 new projects in 2022. 





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