Hadeel al-Sayegh/ Reuters
The Qatar Financial Centre (QFC) is seeing a surge in business as Qataris register more of their assets at home and multinationals navigating a blockade of the country boost their local presence, its chief executive Yousuf al-Jaida told Reuters.
The diplomatic and trade boycott imposed in June by Saudi Arabia, the United Arab Emirates, Egypt and Bahrain has changed the way business is done with Qatar, al-Jaida said in an interview with Reuters.
State-owned companies, or companies owned by mostly Qatari shareholders, and individuals are redirecting their investments to the QFC,he said.
It reflects a desire by international companies to maintain close ties with the world's biggest liquefied gas producer.
The trend, he said, has seen migration from Dubai, which was traditionally the hub for companies doing business across the Gulf, from Saudi Arabia to Kuwait.
The shift to Doha is the result of the diplomatic and trade boycott of Qatar imposed by the four countries on June 5.
"The immediate action was that a lot of the companies that had their special purpose vehicles set up in Dubai International Financial Centre were re-routing their investments in (to) the QFC because they wouldn't know what the uncertainty factor would lead to eventually and how long this will go on for," Jaida said.
"They would rather hold those international assets from here (Qatar) rather than face uncertainty there because of their Qatari background or nationality," he said.
Jaida also pointed to the number of companies registered in the Qatar Financial Centre, which has increased 45% in the third quarter compared to the year earlier.
When compared to the second quarter, in the wake of the blockade, growth rose 6.9%, from 390 companies to 417 companies registered at QFC with $20bn in assets, QFC said in a statement.
Jaida said some of these investments had previously been registered in Dubai's financial freezone but have moved to Qatar after the boycott began in June.
"They don't know how they will be treated by nearby countries," he said.
"So a lot of the companies that used to set up in blockade countries are coming back home."
The boycotting states accused Qatar of financing militant groups, allegations it denies.
"You can no longer service the region from one country, wherever you are, and you're going to have logistical problems. Unfortunately politics and business are being mixed up in the region," Jaida said.
Previously, many multinational companies in the region used Dubai as a base to do business with Qatar.
But because of disruption to travel and banking links, some are now ramping up their presence in Doha, he said.
"We're seeing a lot of the multinationals who used to service Qatar from abroad and nearby financial centres in blockade countries unable to freely travel so they are having to put 3, 4 or 5 more people here on the ground to continue that relationship."
Jaida said emotions were playing an increasing role in business, and that some Qataris were hesitant in doing business with foreign companies unless they had a local presence.
"For us, it's a good period," he said.
"It's never been better."
The boycott has prompted Qatar to embrace multinationals and foreign investment. It has made economic reforms and has opened up visas to more than 80 nationalities.
His Highness the Emir Sheikh Tamim bin Hamad al-Thani recently said Qatar was focusing on completing strategic projects to cope with the sanctions, including ports, water and food security.
"If it wasn't for the crisis this probably would have taken a decade," said Jaida.
Last updated: December 19 2017 10:52 PM
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