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Qatar Innovation Opportunities

by: Tatjana Guznajeva - Technopolis Group

 

Why should I read this document?

 

When confronted with the differences between your own market and the market of Qatar you will likely feel that you have to adapt your product/service significantly to make it fit the preferences and expendable income of local people. While many may see this as a challenge this can also proof to be a great opportunity for your company! Adapting to a new market, like Qatar, will allow your company to innovate. Not only will operating in Qatar lead to new insights to be more successful in Qatar, you will most likely also pick up on ideas to be more successful in your home market.

 

This document provides a short overview of innovation aspects, business opportunities and challenges in Qatar. It will also give advice on best practices for starting and developing an innovative business venture, considering Qatar’s country context. May it help you to explore Qatar and lead you to innovation and success.

 

Opportunities and tips for innovation and doing business in Qatar

 

  • Qatar has one of the highest GDP per capita in the world, the economy is fast growing (an average annual compound growth rate is 10.5% since 1997), and the government is heavily investing in its diversification. The country is politically and economically stable, it offers various opportunities for entrepreneurs and investors in industrial and service sectors.
  • Qatar has the second largest gas reserves in the world. The government of Qatar launched several oil and gas projects and it offers good incentives to investors.
  • The renewable energy sector is rapidly developing in the country. Lusail City is the champion  in transition towards the use of renewable energy and there is a high demand for innovative ideas in transport, construction and infrastructure sectors.
  • If you plan to develop technologies in Qatar, consider doing this at Qatar Science and Technology Park. It is a primary incubator that focuses on development of technologies and on commercialisation of research. The Park allows foreign ownership, it is a tax-free and duty-free import zone. In addition, it offers unrestricted repatriation of profits and does not impose any restrictions on hiring foreign employees.
  • Development of the ICT sector in Qatar has been a priority of the government, therefore its market is expected to reach 3.9 bln. EUR by 2021. Currently, there is a high demand in cyber security, integrated data management and monetisation, smart system operation, ICT training and education services.
  • Due to growth in terms of population and income, the demand for healthcare services is significantly higher than the supply. The government of Qatar is turning to  tele-medicine, cloud technologies, real-time health monitoring and digital patient reconding. The demand for new healthcare, digital solutions is currently very high.
  • In preparation to the FIFA World Cup in 2022, the government of Qatar is investing in infrastructural development. Consider starting a public-private partnership project or doing business in the sectors of construction, transportation and logistics.
  • Over 90% of food in Qatar is imported, due to a lack of arable soil and water constraints. Meat products, vegetables and high-energy food  is in high demand in the country. In addition, the demand for organic products is growing annually.
  • Qatar has a well-developed banking sector, high capital ratios and liquidity . Since local customers are financlly adept and tech-savvy, the demand for new products and services in retail banking sector is very high.

 


On Level 2 you can find information about innovation climate in Qatar, while Level 3 will tell you more about business activities in Qatar.

 

 

This page will tell you about innovation ecosystem, major technology sectors, innovation and business practices in Qatar.

 

Innovation ecosystem

 

Due to strategic and consistent efforts of the government of Qatar, an innovation-friendly culture, a stable macroeconomic environment, good quality of education and availability of capital in the country, Qatar is  an innovation-driven economy. The country ranks 22nd in the Global Entrepreneurship Index (2018) and 51st in the Global Innovation Index. Qatar National Research Strategy guides public organisations to support scientific and technological innovation, transforming Qatar into a knowledge-based economy and a global leader in R&D. The innovation ecosystem in the country is relatively well-developed and coordinated, as the government encourages collaboration between institutions, sectors and actors, and it provides financial support through grants, investments and competitions.

 

One of key actors in the innovation ecosystem is the Qatar Foundation. It is a research and innovation centre that aims to develop research networks and to find new ideas for enhancing the capacity of science and technology across industries and sectors. The Qatar Science and Technology Park acts as an innovation hub that tests new ideas and is well-connected to other business incubators in the country to ensure integration of start-ups into the business community. The development of research facilities and building networks is considered vital by the government of Qatar, therefore the new strategy allocated 2.8% of total government revenues  to finance them. Qatar’s well-developed education system and presence of academic agreements that allow students to study abroad stimulate knowledge sharing and transfer of ideas.

 

Entrepreneurship is seen as the key to innovation and technological development, therefore the government of Qatar has set up a 4.3 mln. fund to support innovative start-ups. Technology-oriented companies receive more intensive public assistance, particularly in sectors of transport, environment and health.

 

Innovation sectors and technology

 

As a result of the strategy of the government of Qatar, the scientific and technological development in the country is focused in the four areas: energy and environment, health, computing and ICT, and lastly, social sciences, arts and humanities. Among other priority areas is security - cybersecurity, water and energy security.  Innovation is perceived as a source of solutions to address pressing social, economic and ecological challenges in the country.

 

Digitalisation is a main innovation trend in Qatar, therefore several public organisations are stimulating entrepreneurship, innovation and scientific development in the ICT sector. Currently, the majority of innovative start-ups in Qatar are designing online applications, software programs and cloud solutions using big data.

 

Innovation culture and practices

 

The population of Qatar has an entrepreneurial mindset, therefore a large share of population has at least once started their own business. Innovation in companies is perceived as a natural process for business survival, therefore most entrepreneurs in Qatar attend business/science events and learn about new technologies. The government stimulates interest for innovative technologies through education, so the younger generation is keen to experiment. Due to commercial ties with other countries, the population of Qatar is learning about foreign innovations, enters into partnership agreements and, at times, transforms ideas to suit local demands and needs.

 

 

This page highlights major economic sectors and iconic products, shows business trends and explains how easy it is to do business in Qatar. In addition, you will find a list of websites, which provide some hands-on information.

 

What is the country known for?

 

Sectors

 

The biggest sectors: natural gas, crude oil, petrochemicals, steel, finance, fertilisers, cement, ship repair, hospitality and tourism.
The industry and service sectors have similar shares of GDP in 2017, namely, 50.3% and 49.5% respectively. Due to climate conditions, the agricultural sector is underdeveloped and it represents only 0.2% of GDP.

 

Iconic products

 

Coffee pots, apparel, shisha, shawls and pashminas, dates, spices, Arabic sweets, jewelry, cosmetics, small furniture, dolls.

 

How easy is it to do business in  Qatar?

 

Based on the World Bank ranking:

 

  Qatar EU Average Emerging markets average
Overall - ease of doing business 83 30 83

 

Qatar offers a relatively good business environment, due to good infrastructure, the easiest, electronic tax payment system in the world, simple processes of property registration and dealing with construction permits, and cheap access to electricity. Due to sufficient regulatory efficiency, market openness and the rule of law, Qatar offers a high degree of economic freedom (it ranks 29th in the 2016 Index of Economic Freedom), thereby stimulating the development of private sector. Among other advantages of doing business in Qatar is the common use of English by the local business community.

 

Among more challenging aspects of doing business in the country are trade across borders, due to a limited number of trade agreements (Qatar and the EU have 14 trade, economic and technical cooperation agreements, and 12 mutual investment promotion and protection agreements), the complicated process of getting credit, and special conditions that apply to protection of minority investors. Qatar is open to foreign investors, however, the investment law limits foreign ownership of local entities to 49% of the entity’s capital and sets specific conditions. Thereby the government of Qatar indirectly encourages foreign entrepreneurs to have a local business partner or a sponsor. In case when a majority ownership is permitted the government will examine a project, giving preference to those that use local raw resources, facilitate technology transfer and promote development of local human resources. Hence, the degree of control and intervention of the government decrease security and independence of foreign entrepreneurs and investors.

 

Business trends in  Qatar

 

Qatar offers a favorable environment for e-Commerce, including a good digital infrastructure and a large number of Internet and mobile users. However, due to a relatively low use of credit and debit cards, the potential of e-commerce is constrained. Among the major online purchasers are companies/organisations in the sectors of education, banking and finance, and ICT.

 

As a result of growing incomes, the spending in restaurants, hotels and places of entertainment is steadily growing. It is expected that higher income levels will lead to changing lifestyle and growing demand of luxury, imported, particularly Western, goods.

 

In 2017, the governments of Saudi Arabia, UAE, Bahrain, Libya, Yemen, Egypt and the Maldives have ceased their diplomatic ties with Qatar, due to disagreements on several political issues. As a result, the companies in international travel and transport sectors have experienced a decline in profits. Considering the position of the government of Qatar, the decrease of business activity in those sectors is likely to continue.

 

More hands-on info

 

 

Bibliography

 

Level 1:

 

Gulf Times. (2018). Qatar tops world with 10.5% average growth rate for 20 years. Retrieved from: https://www.gulf-times.com/story/592313/Qatar-tops-world-with-10-5-avera...
Ministry of Economy and Commerce. (2018). Foreign Investment sectors. Retrieved from: https://www.mec.gov.qa/en/services/economic-corner/Pages/Available-Secto...
Ataullah, S. (2017). Qatar to adopt first renewable energy strategy. Retrieved from: https://www.thepeninsulaqatar.com/article/27/11/2017/Qatar-to-adopt-firs...
Ministry of Economy and Commerce. (2015). Doing business and investment opportunities in Qatar. Retrieved from: https://www.flandersinvestmentandtrade.com/export/sites/trade/files/news...
Kumar, S. (2018). Qatar’s ICT market likely to reach $4.4bn in 2021. Retrieved from: https://www.thepeninsulaqatar.com/article/05/09/2018/Qatar’s-ICT-market-likely-to-reach-$4.4bn-in-2021
ICT Qatar. (2012). State of Qatar ICT Development Strategy. Retrieved from: http://www.motc.gov.qa/sites/default/files/documents/Market%20and%20Stak...
The Peninsula. (2017). Tele-medicine helping Qatar’s healthcare market grow. Retrieved from: https://www.thepeninsulaqatar.com/article/09/05/2017/Tele-medicine-helpi...
Export. Gov. (2018). Qatar- market opportunities. Retrieved from: https://www.export.gov/article?id=Qatar-Market-Opportunities
Muacevic, A. and Adler, J.R. (2017). An iverview of food pattenrs and diet quality in Qatar: findings from the national household income expenditure survey. Retrieved from: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5472397/
Qatar Tribune. (2017). Qatar’s F&B sector sees steady growth. Retrieved from: http://www.qatar-tribune.com/news-details/id/81390
Grant Thornton and HSBC. (2016). Doing business in Qatar. Retrieved from: https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&...
Oxford Business Group. (2015). Qatar’s banking sector sees a dynamic performance. Retrieved from: https://oxfordbusinessgroup.com/overview/qatars-banking-sector-sees-dyna...

 

Level 2:

 

The Peninsula. (2017). Qatar tops Arab region in innovation. Retrieved from: https://www.thepeninsulaqatar.com/article/29/09/2017/Qatar-tops-Arab-reg...
GEDI. (2018). Global Entrepreneurship Index. Retrieved from: https://thegedi.org/global-entrepreneurship-and-development-index/
https://www.globalinnovationindex.org/gii-2018-report
Oxford Business Group. (2015). Qatar establishes itself as a regional base for research and innovation. Retrieved from:  https://oxfordbusinessgroup.com/overview/qatar-establishes-itself-region...
Qatar Foundation. (2018). Qatar Innovation Promotion Award. Retrieved from: https://www.qnrf.org/en-us/Funding/Special-Programs/Qatar-Innovation-Pro...
Qatar National Research Fund. (2018). Raising Qatar’s capacity for innovation, science and technology. Retrieved from: https://www.qf.org.qa/content/20th/raising-qatars-capacity-innovation
Qatar Science and Technology Park. (2018). Silicon Valley Spring break 2019. Retrieved from: https://qstp.org.qa
Edarabia (2012). Qatar is fourth worldwide in quality of education. Retrieved from: https://www.edarabia.com/60175/qatar-is-fourth-worldwide-in-quality-of-e...
eDesk hub. (2018). 7 of the most innovative startups in Qatar. Retrieved from: https://medium.com/@edeskhub/7-of-the-most-innovative-startups-in-qatar-...
Gulf Times. (2018). Fest brings ‘best of American innovation, culture of Qatar’. Retrieved from: https://www.gulf-times.com/story/611330/Fest-brings-best-of-American-inn...

 

Level 3:

 

Worldatlas. (2018). What are the biggest industries in Qatar? Retrieved from: https://www.worldatlas.com/articles/what-are-the-biggest-industries-in-q...
CIA. (2018). The World Factbook: Qatar. Retrieved from: https://www.cia.gov/library/publications/the-world-factbook/geos/qa.html
Begum, K. (2018). Qatar Guide: the 10 most authentic souvenirs you can bring back from Qatar! Retrieved from: https://www.iloveqatar.net/news/general/the-10-best-souvenirs-from-qatar
Rivera, R. C.(2016). Artisans get a taste of traditional Qatari craft. Retrieved from: https://thepeninsulaqatar.com/article/24/01/2016/Artisans-get-a-taste-of...
Oxford Business Group. (2017). The report: Qatar 2017. Retrieved from: https://oxfordbusinessgroup.com/overview/paid-full-depth-look-local-tax-...
Export.gov. (2017). Qatar Financial Sector. Retrieved from: https://www.export.gov/article?id=Qatar-Financial-Sector
NIbusiness info.co.uk. (2018). Exporting to Qatar. Retrieved from: https://www.nibusinessinfo.co.uk/content/advantages-and-challenges-expor...
The Peninsula. (2018). Strategic ties between Qatar and EU strong. Retrieved from: https://www.thepeninsulaqatar.com/article/28/02/2018/Strategic-ties-betw...
Export.gov. (2018). Qatar- market challenges. Retrieved from: https://www.export.gov/article?id=Qatar-Market-Challenges
Alagos, P. (2018). Qatar’ e-commerce market seen reaching $3.2bn by 2020. Retrieved from: https://www.gulf-times.com/story/578828/Qatar-s-e-commerce-market-seen-r...
Export.gov. (2018). Qatar- e-commerce. Retrieved from: https://www.export.gov/article?id=Qatar-ECommerce
Qatar Tribune. (2017). Qatar’s F&B sector sees steady growth. Retrieved from: http://www.qatar-tribune.com/news-details/id/81390
Export.gov. (2018). Qatar- market overview. Retrieved from: https://www.export.gov/article?series=a0pt0000000CbsxAAC&type=Country_Co...

 

Last updated: 10.05.2021 - 08:28