Qatar Gulf News – Doha, Qatar, Wednesday 31 August 2016. Qatar is one of the wealthiest country in the world. The country developed itself based on natural gas, oil and diverse investment around the world. However the question remains. How Qatar became so rich so fast?
Many countries have fossil fuels, but few have done well as Qatar to take advantage of them. Most countries like Venezuela, Iraq, Libya, Nigeria, and others were victims of the resource curse. When an abundance of resources leads to economic distortions and limited growth, Qatar has done much better to reinvest money from the energy and diversify its economy. The support of the United States as well as decades of proven reserves have also fostered the stability in the country. The small peninsula has the highest GDP per capita in the world to $ 98,800 and even that number may greatly underestimate the real wealth of the 280 000 citizens of Qatar. Qatar has enough money to build a large metropolis in the desert and won the right to host the World Cup 2022, allegedly by millions of dollars in bribes.
Qatar has been ruled by the Al Thani family since the early 1900s when it became a British protectorate. On July 17, 1913, Sheikh Abdullah Bin Qassim Al Thani (center-left) became the ruler of Qatar.
At the time, the Qatar Primary industry was pearl and fishing. The country has been marked by widespread poverty, malnutrition and disease due to the collapse of pearl trade in the 1920s.
In 1939, oil was discovered at Dukhan. The field development was slow until 1949, because of the World War II. Although the discovery of oil was important, it was nothing compared to the natural gas reserves found 30 years later. In 1951, Qatar produced 46,500 barrels of oil per day, or $ 4.2 million in revenue. The discovery of offshore oil and their development by Shell led to an increase in Qatar’s production to 233 000 barrels per day.
New revenues from oil exports flooded the pockets of the ruling family and Qatar began a slow process of modernization. First, school then hospitals, a power plant, desalination plant and the telephone exchange all open in 1950.
Oil revenues have increased steadily in the 1960s that the Al-Thani family has strengthened its grip on power by installing relatives in high government posts. All members of the Al Thani family were granted extravagant allocations. Qatar gained independence in 1971 after Britain announced the withdrawing all its military obligations to the east of the Suez Canal.
On 22 February 1972, Hamad ibn Khalifa deposed his father Emir Ahmad ibn Ali, who was hunting hawks in Iran. Khalifa ibn Hamad cut spending of the royal family and the increased spending on social programs, housing, health, education and pensions. In 1971, the field North Dome gas condensate of South Pars was discovered off the coast of Qatar. It is the largest natural gas field in the world. Oil production was still running high at the time, so the area was not developed.
Thanks to North Field, Qatar has the largest natural gas reserves in the world after Russia and Iran. The reserves are estimated at 896000000000000 cubic feet. The oil price crash in the 1980s, had slowed the Qatar economy. The crisis led the country to finally develop the North area in 1989, but even then, production has been slow.
In 1995, the situation in Qatar had not improved. Sheikh Hamad bin Khalifa Al-Thani took the throne in a coup d’état on Emir Khalifa bin Hamad, while the Emir was in Switzerland. Sheikh Hamad put a whole new direction for the country.
One of the first measures of Sheikh Hamad was to accelerate the development of the North Dome field. Production was high and Qatar began exporting natural gas for the first time.
To accommodate production and increased demand, Qatar has started the construction of new liquid natural gas plants. Over the past 15 years, 14 liquid natural gas plants have been built in partnership with international oil companies. In the late 1990s, Qatar has signed production sharing agreements with many international oil companies. New businesses started using horizontal drilling methods to reverse the decline in oil production. The partnership between Qatar and Maersk Oil has resulted in longer horizontal oil drilling in the world.
In 1996, Qatar has built the giant one billion dollar al-Udeid airbase which served as a logistics center and command for the US Army. The partnership with the US Army gave Qatar an unprecedented level of security.
In 1997, the country had started long-term agreements to supply massive amounts of natural gas to Spain and Japan. Over time, Qatar has diversified its clients.
Thanks to the stable oil production and the production of high natural gas. Qatar’s GDP has skyrocketed over the past 15 years. Hoping to avoid the dreaded curse of natural resources, it has taken steps to diversify its economy. In 1998, the government built Education City. A massive campus that supports six American and two European universities and research centers and think tanks. Qatar has amassed a sovereign fund of $ 170 billion thanks to oil revenues and natural gas. It began investing like a hedge fund.
In 2003, Qatar established the Qatar Investment Authority to recycle revenues from oil and gas to other sources of income. QIA has made large investments in Barclays Bank, Credit Suisse, Harrods, Porsche, Volkswagen, and a majority stake in the football team Paris Saint-Germain.
The country has become one of the largest holders of real estate in London by the QIA (Qatar Investment Authority). It owns The Shard, the largest skyscraper in Western Europe, and large parts of Canary Wharf and other parts of the city. The Qatar Financial Center was built in 2005 to develop financial services industry of Qatar. The country believes it can become a leader in financial services for the Gulf States due to its relative stability and a large capital base.
In 2006, Qatar adopted Indonesia to become the largest exporter of liquefied natural gas in the world with revenues from oil and natural gas amounting to 60% of Qatar’s GDP. But more competition came with a liquid natural gas production booming in places like the US and Australia. In December 2010, Qatar was chosen as host for the FIFA World Cup 2022. The country has promised to build 12 state-of-the-art stadiums that use cooling technology so players could escape heat. Qatar has established itself as a hub of sports in the region, hosting or planning to host numerous sporting events worldwide.
Meanwhile, the skyline has changed dramatically in recent years. Here’s how Doha looked like in 1977.
Here is how it looks now. Since 2000, 58 skyscrapers were built, planned, or under construction in Doha, with museums, stadiums, giant infrastructure projects, and more.
There have been numerous allegations of labor and horrible living conditions for migrant workers who build the World Cup sites and other projects. This is not the first time that Qatar has been criticized for the treatment of migrant workers and second-class citizens.
Sources: NetnewsTimes | QGN