Last Updated: February 23, 2023
The state of Qatar is located on a peninsula in the Arabian Gulf and has a land border only with Saudi Arabia. The capital Doha is located in the east of the country directly on the sea. The country has a population of around 2.5 million – almost 90 percent of whom are non-natives – and is slightly smaller than Schleswig-Holstein.
H.H. Sheikh Tamim bin Hamad Al-Thani has led the country as head of state and head of government since 2013, when his father abdicated in his favor. H.H. Sheikh Hamad bin Khalifa had initiated the country’s economic and political opening. In 1999, Qatar became the first country in the Gulf region with active and passive women’s suffrage at the municipal level. Since 2003, Qatar has had a new constitution that provides for a consultative assembly.
From a country whose economy was dominated by fishing and pearl diving, Qatar has rapidly developed into an industrial location since independence in 1971. The industrial and mining sectors contributed 35.3 percent of GDP in 2020, largely due to revenues from the oil industry. Between 1994 and 2017, Qatar’s share of oil production within the Organization of Petroleum Exporting Countries (OPEC) tripled to around five percent. Nevertheless, Qatar withdrew from OPEC at the end of 2018. This occurred against a backdrop of tensions between Qatar and some neighboring Gulf states, but the situation has eased significantly since early 2021.
Qatar is already focusing more on the gas market, as it has the third-largest natural gas reserves in the world and has been the largest exporter of liquefied natural gas (LNG) in recent years. This also resulted in an energy partnership with Germany, which is the fourth largest market for liquefied natural gas. It also has a thriving fertilizer production and aluminum industry.
Qatar’s leadership is now focusing more on diversifying the economy. Against the backdrop of the 2022 World Cup, the Vision Qatar 2030 infrastructure program has been implemented. It represents the transition to a knowledge-based society. Particular importance is attached to the financial services sector. In addition, the Qatar Investment Authority (QIA) sovereign wealth fund – one of the largest in the world – invests heavily in global equities such as Barclays Bank, Credit Suisse, Deutsche Bank, Hapag Lloyd, London Heathrow Airport and Volkswagen. Environmental protection also enjoys increasing political clout in Qatar, with the creation of a Ministry of Environment and a National Environmental Plan.
The need to include local majority partners in company start-ups has been weakened in recent years. In the areas of education, health, industry, agriculture and tourism, as well as in projects related to mineral resources and energy, such a partner is no longer mandatory. In other areas such as consulting services, IT, sports and tourism, 100 percent foreign participation is permitted. Qatar has been opening up to the Asian market for several years. Direct investment is also to be facilitated by the fact that the corporate tax rate for foreign companies remains constant at ten percent. Thanks to the government’s economic stimulus packages and the successful vaccination campaign, Qatar’s economy is recovering relatively quickly from the effects of the Covid-19 pandemic.