Qatar Financial Center is seeking to attract $25 billion of foreign direct investment inflows by 2022, its CEO Yousuf Al-Jaida told CNBC in an exclusive interview on Wednesday.
It comes a week after Saudi Arabia reinstated diplomatic ties with neighboring Qatar, ending more than three years of blockade against the tiny, gas-rich nation.
The reconciliation means a stronger, more powerful Gulf Cooperation Council, Al-Jaida said.
“I think the impact is going to be positive on trade, which means countries are going to be working closely with each other,” he added.
Saudi Arabia, together with the United Arab Emirates, Bahrain and Egypt, sealed off land, sea and air borders with Qatar in 2017, after accusing Doha of links to terrorism. Qatar has denied those allegations.
The thawing of tensions — just weeks before the end of President Donald Trump’s tenure in the White House — is a major shift in the politics of the region.
Doha competes with global financial centers in the region including Dubai in the United Arab Emirates, and Saudi Arabia’s capital Riyadh.
Dubai, one of the region’s transport and tourism hub, is facing fresh competition from Riyadh.
Saudi Arabia is trying to attract multinational companies to the capital as part of Crown Prince Mohammed bin Salman’s ambitious Vision 2030 blueprint to diversify the kingdom’s economy.
Skyline of Doha, Qatar
Sven Hansche | EyeEm | Getty Images
Al-Jaida said Doha’s edge over its rivals is the push to develop Islamic finance and fintech, as well as financial services in general.
The financial center’s ambitious FDI target — along with the goal of creating 10,000 new jobs and more than 1,000 companies by 2022 — will get a boost from the GCC detente, he said.
“From a QFC perspective, multinational corporations are pretty much based in the entire GCC, and it’s going to mean more liberal travel, more access to markets. It’s going to mean more foreign direct investment for Doha. So we’re very optimistic about that,” Al-Jaida said.
The six-nation GCC is a political, economic and social alliance which includes Saudi Arabia, the United Arab Emirates, Bahrain, Kuwait, Oman and Qatar.
According to the World Bank, Qatar’s economy is expected to grow 3% in 2021, and is the best among GCC countries.
Qatar, one of the world’s richest country per capita, has also set its sights on sports. The country is slated to host the World Cup in 2022, and has submitted a request to the International Olympic Committee to join the “continuous dialogue” about possibly hosting the Games in 2032.
Ties between the Gulf neighbors run deep, and the blockade left a gap which impacted trade across the GCC.
According to Brookings Institution, flights between Qatar and its Gulf neighbors totaled 70 per day before the fallout. The airlines sector, hit hard by the global pandemic, stands to benefit significantly from the cooling of tensions.
Before the blockade, trade flows between Qatar, Saudi Arabia and the UAE were in the billions, and in the millions with Bahrain, the think tank said.
Al-Jaida told CNBC, that there’s more work that still needs to be done in building trust between Qatar and its neighbors in the Gulf and Egypt, but “this is behind us, and we’re working towards a better future for the entire region, so everybody is optimistic.”