Qatar's corporate executives, who are upbeat about future economic growth prospects, view that the FIFA World Cup, currently underway, would make a drastic shift in global perception about the country as an international tourism hub, according to Ernst & Young (EY).
The EY's Qatar Investment Outlook Pulse 2022 revealed that 82% of interviewed executives believe that hosting the prestigious football event would make a “strong” to a “very strong” impact in shifting the perception of Qatar as a global tourism hub, ultimately resulting in improved tourism flows and spending.
The report is based on extensive one-on-one discussions, from the fourth quarter of 2021 to the first quarter of 2022, with executive decision-makers across the largest businesses in Qatar.
While 55% indicated that they have invested in projects specifically to capitalise on the opportunities presented by the football event, EY said, half of these investments went into tourism, hospitality, and real estate.
The prestigious football event, the start of the North Field South (NFS) expansion, the award of the 2030 Asian Games, and the strategic national goal of diversifying the economy away from hydrocarbons, have all drawn the attention of foreign investors and "resulted in positioning Qatar as an investment destination of choice."
Executives in Qatar remain bullish about the country's future economic prospects, with about 82% expecting the growth of the coming five years to meet or exceed forecasts, the report said.
The country’s GDP (gross domestic product) is expected to rise to QR764bn this year, which is "significantly" up compared to the QR525.7bn in 2020 amid the Covid-19 pandemic, it said.
Oil and gas as well as consumer services had the most positive sentiments, with respectively 64% and 45% of interviewees expecting the sectors to outgrow the general economy over the next five years.
“Qatar has shown great resilience in the face of many challenges and has resolutely navigated regional and global events, particularly the Covid-19 pandemic, which was brought under control through an efficient and agile vaccination programme," said Ammar Sudki Hattab, Qatar country market leader, EY.
This, according to him, has instilled great confidence in executives and investors, despite the ongoing global economic headwinds, with optimism around the promise of more opportunities throughout the country.
Around 55% of interviewees had bearish sentiments relating to the growth of the construction sector, especially since most mega projects would be either complete or nearly complete in the coming months.
New mega projects, however, such as the postponed Sharq Crossing, the planned airport expansion and the development of the Lusail City project, might help alleviate some of the worries surrounding the sector’s prospects.
Nearly 60% of interviewed executives indicated that their investments have managed to yield "positive" returns in the past 12 months, through a period that still had many imposed restrictions from the Covid-19 pandemic, indicating business and consumer activities in the country were largely resilient.
Despite geopolitical crises outside of the region and increasing inflation, executives in Qatar remain "highly optimistic" regarding investment performance over the coming 12 months.
The report found that 91% of them indicated that they expect their investment performance to improve relative to the previous year’s performance.
Around 64% of the respondents indicated some difficulties in access to capital. However, recent initiatives indicate that regulators are taking steps to improve capital accessibility, such as with the launch of the Qatar Venture Market, aimed at increasing access to capital for the small and medium enterprises or SMEs.
Furthermore, the Qatar Fintech Hub was launched as part of a wider strategy to improve innovation and access to capital within the Qatari economy.
Ammar Sudki Hattab, Qatar country market leader, EY.