Oasis of Dialogue event explores nation’s economic strengths, weaknesses, and growth prospects amid COVID-19 and beyond
Education and embracing technology as part of learning will help to ensure that Qatar’s economy survives and rebounds from the global COVID-19 pandemic, an economics expert has said in the second edition of Oasis of Dialogue, organized by Qatar Foundation member QatarDebate.
Speaking as a panelist during the event, Dr. Alanoud Al-Maadid, Assistant Professor of Economics, told the discussion that, despite the effects of the current health crisis, there is “a great opportunity to diversify the Qatari economy”.
One of the most important sectors that contributes to the diversification of economic resources is Qatar's investment in education, and the expansion of learning technologies and resources through educational institutions locally and internationally
“One of the most important sectors that contributes to the diversification of economic resources is Qatar's investment in education, and the expansion of learning technologies and resources through educational institutions locally and internationally,” she said.
“Global indicators show the prosperity of Qatar’s economy despite its exposure to various crises. Although the economy of Qatar was affected by the blockade, it accelerated the growth of some sectors, as dozens of new factories were opened, and some laws were introduced to encourage foreign capital to enter the Qatari market.”
Dr Al-Maadid pointed out that while the manufacturing, commercial, real estate, and transportation sectors have been most widely affected by the pandemic, other sectors have benefited, including distribution, information technology, and some medical industries.
“In the energy sector, there are a number of companies focusing on renewable energy, such as solar energy. Qatar also hosts sporting tournaments and has opened many museums, and this means there is a great opportunity to diversify and invest in the tourism sector, as well as the IT and computer services sectors that have proved particularly important in light of the pandemic, since most companies, schools and universities have become dependent on the technology sector.
After the blockade of Qatar, the growth of the agricultural sector accelerated, and there is now a greater opportunity for companies to enter these area
“After the blockade of Qatar, the growth of the agricultural sector accelerated, and there is now a greater opportunity for companies to enter these areas.”
"As for the pandemic that is sweeping the world, the Qatari economy has been affected by it. At the same time, Qatar has proven its strength, just as it surpassed the repercussions of the blockade. There is a stable outlook for Qatar, and it is expected that the country will have the lowest deficit among the Gulf countries this year.”
The panel discussion assessed Qatar’s economic strengths, weaknesses, and potential areas for growth, as well as the role of the private sector in diversifying sources of income sources – and emphasized that the future of the nation’s economy should be built on human capital.
The Oasis of Dialogue event – which saw participants share their views on Qatar’s economic future via social media – also featured panelist Dr. Khaled Al-Khater, a researcher at the Centre for Macroeconomics and the Institute for Emerging Markets at the University of Cambridge, UK, highlighted the strength of the Qatari economy and its ability to adapt to crises, saying: "The Qatari economy has emerged from the blockade of the nation in a more solid and self-reliant way, as it pushed Qatar toward diversification in production and imports, and to be more open to the world.
We must move from a rentier growth model to a growth model based on building human capital, technological transformation, and industrial development
“The COVID-19 pandemic came as another test for the Qatari economy and demonstrated that the country was better prepared to manage a crisis, due to the solid foundations upon which its economy is built. However, it is unfair to assess the economy now, as the global economy is in a transitional phase and all countries around the world are affected by the pandemic.”
Dr. Alkhater said the pandemic is set to lead to a decrease or contraction of Gross Domestic Product, explaining: "This virus came without warning and struck both supply and demand, making it different from previous crises which affected the demand side only.”
However, he pointed to a study by the International Monetary Fund that identified Qatar as one of the world’s fastest-growing economies in the world, with an annual growth rate of more than 12 percent. “In Qatar, we are far from negative economic growth or economic stagnation, but this does not mean laxity,” he said. “Economic diversification is necessary to be able to overcome shocks in the oil market, and boom-and-bust cycles.
"Rapid and strong economic growth has side costs, and we must be aware of the effects of these costs, including an increase in inflation rates and shifts in the demographic and cultural composition of society. To address them, radical solutions must be found in the growth model so that it gives us better outcomes.
"We must move from a rentier growth model to a growth model based on building human capital, technological transformation, and industrial development. Building human capital is the basis for the drive towards growth, but it can suffer from the demand side of employment being clogged despite the high quality of education outcomes.
"We are feeling the effects of the current crisis in the short-term, but in the long-term these effects can be surpassed. Generally, crises lead to a push towards economic diversity, as has happened in Asian economies, many of which were launched from crises.”