Qatar’s ambassador to the UK, Yousef Ali al-Khater, gave the keynote address at the Oxford-GCC Business Conference 2017 held at St Antony’s College in London on Saturday.
The event partners were the University of Oxford, the Arab British Chamber of Commerce and Said Business School; participants included Oxford Gulf and Arabian Peninsula Studies Forum (OxGAPS), the Arab Gulf States Institute in Washington, Oxford Women in Politics, Oxford Business Group, Arabisk and Unity for Global Development. Scholars and policy experts spoke on a wide range of topics impacting the GCC business environment.
Speaking to Gulf Times at the conference al-Khater said Qatar had a strong focus on developing a diversified economy with a dynamic private sector.
“We are working away from hydrocarbon resources because we believe that sustaining the development of future generations should be our key focus.
“The government will continue to provide some of the incentives that we offer at the moment but this will not last. It is not indefinite. The government is trying to find the base for private business to take their share in recruiting the new generations. Hopefully, this will be realised with the implementation of the Qatar National Vision 2030.”
Dr Khalid Rashid Alkhater, speaking in his personal capacity as a Qatari economist specialising in monetary policy and political economy and a fellow researcher at Cambridge University, addressed the role of the private sector in the GCC growth model. “There is a dire need for diversification outside the oil sector, particularly to promote the development of an export tradeable sector that is not constrained by the boom-bust cycles of the oil sector,” he said.  He observed that sustainable economic benefits would flow from incentivising investors to look beyond government contracts and take more risk in investing in private sector ventures.
He said that aims to channel human resources towards high value sectors can be undermined by a focus on construction and real estate projects which tend to soak up national human capital and result in the squeezing of the tradeable sector.  He added that adopting a model which fosters diversification and allows wealth distribution while not disturbing the status quo is always challenging.
Alkhater said that many oil based economies in the region have their economic activities concentrated in the non-tradeable sector such as services and construction relying on low skill imported labour with the majority of nationals employed in the public sector. This model, he said, does not support building human capital, technological development, or a knowledge based economy. He added that the most important and challenging element of diversification is human capital development.
He characterised periods where the oil revenues fall as opportunities to develop the non-oil tradeable sector.
He pointed to Malaysia and Indonesia as countries which had successfully diversified their economies through policies enacted ahead of oil revenue dips as a result of necessity. They used vertical diversification to create linkages in the existing industries and horizontal diversification with an emphasis on exports and technological upgrade.
Oliver Cornock, editor-in-chief, Oxford Business Group, spoke on ‘Plotting a new course for private sector development in the Gulf States’. He noted that within many GCC countries the tradeable sector is focused on servicing the needs of a transient immigrant workforce intent on repatriating their wages. He argued that a different kind of private sector needs to be developed with economic diversification of the non-oil tradable sector towards high value-added sectors.
Chris Innes Hopkins, UK executive director, Saudi-British Joint Business Council, argued that SMEs are handicapped by inadequate access to financing, lack of skills, and poor business services support.
Professor William Scott-Jackson, chairman, Oxford Strategic Consulting, said that family businesses within the GCC should be more proactive in seeking opportunities; he pointed to the defence industry in Saudi Arabia as a prime example of a sector in which they could profitably engage. He also noted that within Qatar there was great potential for engagement by family firms in high end tourism.