By Taimur Ali
Not long ago Qatar was
known merely as a micro-state in the Middle East. Despite the Persian Gulf
emirate’s carbon reserves, Qatar was largely under the shadow of its more
powerful neighbors. Yet, in December 2010 Doha secured the bid to host the FIFA
World Cup 2022, bringing the tiny Gulf Arab nation into the international
spotlight and causing a surge in global media attention, particularly on social
media.
Qatar, with the world’s highest GDP per capita, has seen tremendous
prosperity in recent years. Many have simply attributed the emirate’s
remarkable economic growth rates to the World Cup, claiming that hosting the
event is the principle factor driving Qatar’s boom. In light of the ongoing
investigation into the World Cup 2018 and 2022 bids and the possibility of Doha
being stripped of its right to host the event, Qatar’s future has been cast
into doubt. However, this narrow view of Qatar’s prosperity overlooks Doha’s
well-devised and multifaceted development strategy that Qatari officials
created and began to implement years before the World Cup came into the
picture.
According to a report by Deloitte, Qatar is estimated to spend USD 200
billion on the World Cup, a tremendous investment compared to South Africa’s
USD 4 billion in 2010 and Brazil’s USD 15 billion in 2014. A large proportion
of this money is being spent on infrastructure development, which serves not
only for the event but for the emirate’s development in general. Given that
these projects are not only centered on the World Cup, there will not be a major
setback in terms of spending if Qatar loses the hosting rights. According to a report by the
Bank of America Merrill Lynch published in 2014, the estimated cost of losing
the World Cup would be USD 16 billion, including lost revenue and cancellation
of stadiums and other specific projects. This equates to a loss of 1-1.5 per
capita GDP per annum each year until 2022, a figure that is not drastic given
Qatar’s average
GDP growth rate of 7 percent till 2015. Given the urgency with which Qatar is
diversifying its economy—evidenced by recent growth in various sectors such as
services, tourism, arts, and culture—these figures highlight how the current
FIFA investigation does not pose a substantial threat to the emirate’s
development.
In 2014, Qatar boasted the
highest growth rate in the services sector in the Middle East, with an expected
growth rate of 7.8 percent in 2015. This is largely due to the underdeveloped
financial sector that is rapidly expanding, given that Qatar is looking to
invest its wealth to sustain economic growth while becoming less dependent on
hydrocarbon revenues in the future. Also, as Doha challenges Dubai and Manama
as a financial hub of the Middle East, a growing number of investment banks,
consultancies, and sovereign wealth funds are opening offices in Qatar due to
the large returns on offer. This trend is expected to continue as investors are
increasingly drawn to Qatar and the emirate seeks to increase its investments
abroad, as highlighted by Qatar’s acquirement of assets in important cities
worldwide such as London and Washington D.C.
A major driving force behind
the emirate’s development is Doha’s aim to establish itself as a popular
tourist destination, which is related to Qatar’s developments in arts and
culture, the hospitality sector, and transportation infrastructure. Exhibitions
at the Museum of Islamic Arts (MIA) already draw a lot of international
attention, and Qatar Museums (QM) plans to expand its range by opening numerous
other museums such as the National Museum and Sports Museum. These initiatives
will surely attract tourists to Qatar, particularly given the lack of such
projects elsewhere in the region. Performances by world-renowned orchestras,
promotion of foreign film, drama, and music are other major sources of
attraction, both for tourists and for expats as job opportunities.
Another side of the
narrative, which often prevails in the Western media, is that taking away the
World Cup will remove the only incentive Qatar has to curb human rights
violations. This claim is based on the numerous reports published by various
media outlets about the deaths of construction workers, their poor living
conditions, and the lack of free media to address such issues. Qatari officials
have released statements countering these accusations, questioning the validity
of the statistics presented, and maintaining that the Gulf nation is pursuing
meaningful efforts to improve the situation.
Undoubtedly, drastic reform
is necessary in terms of labor rights, the kafala
(sponsorship) system, improving corporate accountability, and speeding up the
judicial process. Although these reforms are being gradually implemented, the
motive is not the 2022 World Cup, but rather Qatar’s image as a tourist,
financial, and cultural hub. The World Cup has garnered Qatar much negative
attention from human rights organizations like Amnesty International, and the
emirate has taken the onus upon itself to improve, regardless of the mega
event, due to the various other aspirations it has.
If the FIFA investigation
leads to Qatar being stripped of the World Cup, both the emirate and the Arab
world will suffer a significant loss in the short-run, as will the sport
itself. FIFA World Cup 2022 presents an ideal opportunity to truly globalize
the sport, promote the game in the Persian Gulf, and create positive publicity
for the region. However, the loss will barely go beyond a brief slump in
popularity for Qatar, cancellation of a few projects and slowing down of some
others. Some analysts even maintain that this would not necessarily constitute
a negative development given the risks of the Qatari economy’s overexertion.
Regardless of how the FIFA
scandal evolves, Qatar’s steps to achieve massive development are unlikely to
be largely impacted given the emirate’s commitment to economic growth and
diversification, of which the World Cup is only one tool out of many. Yet, such
an outcome of the investigation remains less probable given that since December
2010 the Qataris have displayed their ability and enthusiasm to host the event
while dismissing all accusations of corruption as mere fallacies on the part of
the media.
About The Author:
Taimur Ali is based at Georgetown Qatar. He has previously conducted
research at the Research Society of International Law, Center for Policy and
Governance, and the British Chamber of Commerce in Qatar.