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Persistently low oil prices, rolling conflicts throughout the Middle East, a massive outflow

of humanity sparking the world’s biggest refugee crisis since World War II, vicious attacks by terror groups, even the Brexit vote for the U.K. to leave the European Union: all have added to the un-certainty that is shaking interna-tional markets and, specifically, those in the Middle East-North Africa (MENA) region. But through the challenges and in-stability, Qatar has been stand-ing strong, not least because of a decade of prudent management by the Central Bank.

The government has taken steps to successfully diversify Qatar’s economy, moving away from economic dependence on oil and into other sectors. The contribution of the non-hydro-carbon sector to the economy has already exceeded 50% and is expected to account for 70% of GDP by 2017. The government has tapped the Central Bank, led by Governor Sheikh Abdul-lah bin Saud Al-Thani, who this year marks 10 years at the helm of the financial institution, to over-see implementation of a Strategic Plan aimed at achieving diversi-fication and developing a com-petitive economy. Ultimately, the aim of the economic reforms is to ensure a high standard of living for all of Qatar’s people, accord-ing to Mr. Al-Thani.

One of the wealthiest coun-tries in the world, Qatar has not, however, been immune to the slump in global energy prices, even as it has moved away from oil as an economic mainstay.

“Developments in Qatar’s economy are influenced by changes in oil prices, as in any other Gulf Cooperation Coun-cil (GCC) economy,” says Mr. Al-Thani. “Major factors which contributed to the persistent low oil price were weaker demand from advanced and emerging economies, increased supply from Iran after the lifting of sanc-tions, and increased production by other oil producers to retain their market share.”

Nevertheless, Mr. Al-Thani expects that eventually balance will be restored in the energy market and the price of oil will settle at “a comfortable level.”

For the time-being, the Cen-tral Bank and the Government of Qatar are focused on the present and are taking action to preserve stability without

disrupting growth and the peo-ple’s standard of living, “mak-ing structural adjustments in expenditures without affecting planned infrastructure develop-ments,” the governor says.

Two other financial sector regulators – the Qatar Finan-cial Markets Authority (QFMA) and Qatar Financial Center Regulatory Authority (QFCRA) – are working with the Cental Bank to implement Qatar’s Stra-tegic Plan 2030, which seeks to maintain a stable financial en-vironment for business and in-vestment, while simultaneously enhancing protections for inves-tors and consumers.

To further enhance stability, Qatar is implementing new rules developed by the Basel Commit-tee on Banking Supervision, to

strengthen the regulation, su-pervision and risk management of the banking sector. Areas tar-geted include the liquidity cover-age ratio – which requires banks to hold a certain level of highly liquid assets, making them less able to lend out short-term debt – and the net stable funding ra-tio, which is intended to place limits on the extent to which banks can rely on short-term wholesale funding, in order to encourage better assessment of funding risk and promote fund-ing stability.

The Central Bank regularly conducts “stress tests” on the country’s banks and is actively strengthening “macropruden-tial oversight and working to develop an early warning system for the financial sector,” says Mr. Al-Thani.

As a result of this sound gov-ernance, Qatar-based banks saw the strongest growth in total as-sets in the third quarter of 2015 of any banks in the GCC. Year-on-year asset growth among

Qatar-based banks was 11.3%, compared to 7.5% year-on-year growth among banks in the United Arab Emirates (UAE), 6.5% growth in Saudi Arabia, and 4.5% in Kuwait, according to a report by Kuwait-based Global Investment House.

Omar Mahmood, a partner at KPMG in Qatar, has said that banks are likely to be able to con-tinue growing in the foreseeable future, thanks to the ongoing preparations for the 2022 FIFA World Cup and other planned infrastructure projects.

Mr. Al-Thani says prepara-tions for the competition are “in full swing” and that they would benefit all Qataris.

“The major focus of in-frastructure development includes the construction of roads and rail, and sea and airports, etc. This entails in-creased financing require-ments for the real estate and construction sectors. Involve-ment of the private sector in this development is critical.

“Banks are able to support the increased credit demand – credit to the real estate and con-tracting sectors grew by around 26.5% in 2015. Investments are also focused on industrial zones, information and communica-tion technology, education, the health sector, etc. These devel-opment projects are expected to stimulate the domestic economy and provide substantial invest-ment opportunities for the pri-vate sector, including foreign investment.”

U.S. companies are among the international entities helping Qatar to prepare for the 2022 FIFA World Cup. More than 100 U.S. firms have a presence in Qatar, and around six U.S. universi-ties have opened campuses in the emirate.

The presence of those in-stitutions of higher education “supports our vision to trans-form Qatar’s economy into a knowledge-based economy,” the governor adds.

U.S.-based MSCI upgraded Qatar from frontier market sta-tus to emerging market status in 2014 – exactly “the right time,” according to Mr. Al-Thani, who says that the upgrade would improve depth and liquidity in the equity market and attract further investment.

Under the stewardship of the Central Bank governor, Qa-tar has also taken great strides toward making its National Vision 2030 a reality. The Na-tional Vision sets out four guid-ing principles based on which the government aims to build a sustainable economy and ad-vance the standard of living of its people. Launched in 2008, a key focus of the National Vision is di-versification of the economy, and it is already “providing impetus to increased growth in non-hy-drocarbon sectors, which grew by around 7.8% in the third quar-ter of 2015,” Mr. Al-Thani notes.

The Ministry of Development Planning and Statistics has pro-jected that real GDP in Qatar will grow by 4.3% this year, in spite of the pressure the worldwide en-ergy price slump is putting on the small Gulf country.

In the World Economic Fo-rum Global Competitiveness Report 2015-16, Qatar ranked 14th out of 140 countries, the highest score among the GCC countries. The Moody’s ratings agency has forecast that Qatar’s average real GDP growth will remain robust at around 5% until 2017, allowing the emirate to maintain its position as the most competitive economy in the region.

But all is not rosy. Qatar’s Emir, Sheikh Tamim Bin Hamad Al-Thani, last year approved a budget for 2016 that dramati-cally cuts expenditures, as Qa-tar stared at its first financial shortfall in 15 years. The budget plans for expenditures in 2016 of QAR 2.5 billion ($687 million), or more than 7% less than in fiscal year 2015. The belt-tight-ening comes even as spending on public servants’ salaries and major projects, such as prepara-tions for the 2022 FIFA World Cup are on the rise.

And although Qatar’s in-stitutional strength is rated as ‘high’, the Moody’s ratings agency has said governance is constrained by “very high inflation volatility.” Inflation in Qatar averaged 3.43% from 2005 until 2016, reaching an all time high of 16.59% in June 2008 and a record low of -9.96% in December 2009.

Since 2009, however, infla-tion in Qatar has been rela-tively stable, and well below rates in MENA as a whole, Moody’s says.

Our World

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Central Bank maintains economic stability amid

regional uncertaintyCentral Bank Governor Sheikh Abdullah bin Saud Al-Thani remains con-fident about the prospects for Qatar’s economy, in spite of multiple chal-lenges facing the Middle East-North Africa region and the world at large

Sheikh Abdullah bin Saud Al-Thani, governor of the Central Bank of Qatar


2 Friday, October 7, 2016 Distributed by USA TODAYQATAR

Financial regulatory re-form in Qatar has seen improvements over the last several years

that promise to help the future growth of the economy in line with the hopes and dreams of the National Vision 2030. The collaboration between the three main regulatory authorities pro-vides a stage to demonstrate an international example of new global economic opportuni-ties in the region. Global and regional considerations are at the forefront of development in diversifying the Qatari economy and broadening progress in the financial sector.

Established in 1993, the Qa-tar Central Bank (QCB) is the primary regulator of financial institutions inside the state and is working in tandem with the Qatar Financial Center Regula-tory Authority (QFCRA) and the Qatar Financial Markets Authority (QFMA) to further secure a more effective regula-tory framework that will con-struct strength and resiliency in the financial sector as a whole.

“A strong and resilient finan-cial system is the foundation of every economy,” says Michael Ryan, CEO of QFCRA. “Meet-ing the challenges of excep-tional growth demands vision and focus, and that has been a particular strength for Qatar’s financial regulators.” Mr. Ryan brings to the QFC Regulatory Authority his rich expertise, hav-ing served in a number of senior management positions at Bank of America Merrill Lynch and Credit Suisse Financial Prod-ucts, as well as serving on the Irish prime minister’s advisory committee on financial services.

Together these three regula-tory bodies have developed the first Strategic Plan for Qatar, focused on defining the values

and objectives that will be car-ried out with the predicted eco-nomic growth.

The Strategic Plan has six critical goals, which include strengthening the financial market infrastructure through enhancements to the payments and settlements system, and initiatives to develop the debt market. It is also aiming to en-hance consumer and investor protection by developing stan-dards and codes of conduct. The plan additionally seeks to protect credit information and to raise public awareness and educa-tion. The organization’s aim is to expand macro-prudential oversight by building a frame-work that is in line with interna-tional best practices. It seeks to develop a consistent risk-based micro-prudential framework that coincides with global regu-latory progression and improves disclosure practices.

Economic reform is one of the four pillars of the Qatar National Vision, but leaders in the finan-cial sector realize that a holistic, human-centered approach is the way in which reform will continue to make the state a viable market for international investments. In April, the plan to create a specialized center to combat money laundering and funding of terrorism was an-nounced at the Middle East and North Africa Financial Action Task Force meeting. The center will work to raise awareness that will reach far beyond Qatar. The country’s vision to grow eco-nomically is correlated with the concerns for the international community and the detriment that terrorism places on financial stability and security in affected regions. By positioning Qatar as a prominent contributor in the combat against the kind of funding that perpetuates these

crimes, the state is improving its international position as a stable market that maintains integrity and transparency in its financial exchanges.

The recent formation of the College of Supervisors will help carry out the Strategic Plan by facilitating further cohesion be-tween the QCB, QFCRA and QFMA with a group of senior managers from all three institu-tions. These regulatory authori-ties have already begun to put change in place with new laws.

The new QCB Law No. (13) of 2012 introduced specific pro-visions addressing the licensing and supervision of insurance businesses, protection of credit information, merger and acqui-sitions of financial institutions, settlement of disputes, sanc-tions for those who conduct financial services activities without required licenses, con-sumer protection and customer confidentiality, and regulation of Islamic financial institutions.

QCB is established as the central authority in the imple-mentation of the policies relat-ing to regulation, control and supervision of financial services and markets in the state. It also gave an expanded focus to the macro-prudential framework in Qatar by creating the Finan-cial Stability and Risk Control Committee (FSRCC), which is responsible for identifying and assessing risks to the financial sector and markets, and then proposing recommended solu-tions for such observations. The FSRCC also proposes policies related to regulation and su-pervision of financial services businesses and markets. Work done by FSRCC coordinates the regulatory authorities and minimizes the gap between the organizations so that all work toward a unified vision in the financial sector.

As Governor of QCB and Chairman of the QFCRA and QFMA boards, Sheikh Abdul-

lah bin Saud Al-Thani says, “A number of important regula-tions, based on Basel III, have been issued to strengthen the banking sector in recent years. In addition to capital standards, maintenance of liquidity cover-age ratio, net stable funding ra-tio and loan-to-deposit ratios, as well as capital charges for domestic systemically impor-tant banks (D-SIBs), etc., are prescribed.”

Due to these kinds of im-provements, Qatar has con-tinued to receive high credit ratings and has been upgraded to “emerging market status” by several agencies.

Other regulations since 2012, like the QFMA Law No. 8, have given this organization more responsibility in the protection of investors, maintaining fair and efficient financial markets, pursuing professionalism and transparency in the market’s integrity, and policing mislead-ing information related to finan-

cial services. Mr. Al-Thani also describes the new Law No. 2 of 2015 that was in enacted to “modernize the state financial system as well as align with the developments in the global eco-nomic and financial system” as being “expected to enhance the efficiency of public spending by tracking income and expenses accurately and continuously.”

He adds, “The law constitutes a comprehensive audit policy and intends to improve the coordination between various stakeholders in the processes of preparing and implement-ing the budget.”.

The initiatives that have been put in place over the last few years are now officially under way. “In January 2014, the QCB issued the final Basel III circular, which introduced a minimum capital adequacy ratio of 12.5%. National banks have also been evaluated on the extent to which they are domestic systemically important banks (D-SIBs). These D-SIBs are required to maintain capital charges of 0.5% to 2.5% in dif-ferent D-SIB buckets. These in-structions will be implemented in 2016 in a phased manner,” says the governor.

The regulatory reform by the QCB, QFCRA and QFMA has begun to create an economic environment in line with the rest of the developmental goals of Qatar. The many new sanc-tions that have been put in place are showing an improvement in investment from international companies working to help prepare Qatar for the 2022 FIFA World Cup. Putting these regu-lations in place, diversifying the economic interests and focusing on building human capital is molding Qatar into the stable, knowledge-based economy that its leadership sees for a sustain-able future.

Banking sector remains resilient and optimistic despite analyst warnings

During the years of high oil prices, Qa-tar’s banks success-fully surfed the wave

of profitability. They funded numerous projects. They were awash with cash. They made acquisitions and grew their pres-ence abroad.

Then came June 2014 and the nosedive of the price of oil, the backbone on which many a Middle Eastern economy is built. From $115 per barrel, oil plunged 70% to less than $35 a barrel by February 2016. This sharp fall in oil prices coincided in Qatar with a ramping up of infrastructure projects, including the construc-tion of the Doha metro system, several highways, and stadiums that will be used for the FIFA World Cup in 2022. The inter-section of the two – stepped up spending on infrastructure proj-ects and sharply lower oil prices – brought a warning from Inter-national Monetary Fund (IMF) Director Christine Lagarde for Qatar and other Gulf states to do some belt-tightening.

Standard & Poor’s warned in a report published this year that Qatar’s banks are likely to face tightening liquidity, weaker credit growth and lower profits

this year, partly because of the fall in oil prices and a reining in of the government’s public investment program. But, the report said, Qatari banks’ asset quality has held steady, and credit growth has shown resilience, thanks to strong private sector activity in 2015.

“We think banks will manage their funding profiles more con-servatively, which should trans-late into lower growth. We also expect credit losses will increase given the economic slowdown and the pressure we expect in some sectors, such as contract-ing,” said Standard & Poor’s Di-rector Fevzi Timucin Engin in a recent interview.

Heeding the warnings, Gov-ernor of the Qatar Central Bank Sheikh Abdullah bin Saud Al-Thani says that the QCB “will con-tinue to actively manage liquidity in the system in order to ensure a stable interest rate environment and thereby facilitate an adequate flow of credit to the productive sectors of the economy.”

OptimismCommercial Bank of Qatar CEO, Joseph Abraham remains optimistic about the banking sector and the economy as a whole. He says that that while

economic growth in Qatar has “indeed slowed a bit…we are still witnessing robust economic growth in our economy.”

He adds, “Qatar will spend nearly $200 billion over the next decade on infrastructure projects as we move close to the FIFA 2022 World Cup. De-spite the fall in oil prices, Qatar’s Minister of Finance has stated that it will be business as usual in terms of these projects’ ex-ecution. Commercial Bank re-mains strongly committed to supporting and financing the development of these major infrastructure projects.”

Ali Ahmed Al-Kuwari, Group CEO of Qatar National Bank (QNB), shares Mr. Abra-ham’s optimism: “The recent fall in oil prices will only have a minor impact on the strong diversification drive of the Qatari economy. The Qatari economy will continue to grow on the back of strong public and private investments to diversify the economy away from the hydrocarbon sector. As a result, the banking sector will continue to benefit from these strong tailwinds, with double digit-growth in assets and deposits.

“Solid profitability is support-ed by high asset quality (five-year average non-performing loans of 1.8%) despite high capital buffers with a five-year average capital adequacy ratio of 17.6%.”

Mr. Al-Kuwari put part of the banking sector’s stability down to a traditionally conservative approach to lending.

“This engenders a strong risk governance mentality, generates a clear definition of risk appetite, and promotes prudent risk man-agement at consolidated and local levels,” he says. “Caps on consumer credit limit and tight lending standards have kept the risk of excessive private sector leverage contained with con-servative loan-to-value ratios for specific products.”

Assets and profits upDespite the uncertain political and economic global backdrop, the majority of Qatari banks kept shareholders happy by recording a rise in assets and profits in 2015.

QNB Group’s net profit in 2015 rose to QAR 11.3 billion ($632 million), up by 8% com-pared to 2014, while total as-sets increased by 11% to reach QAR 539 billion, the highest it has ever achieved.

CEO of Doha Bank, Dr. Ragha-van Seetharaman, notes that his bank recorded net profits for the first quarter of 2016 of QAR 354 million. Total assets increased from QAR 74.2 billion at the end of Q1 2015 to QAR 84.7 billion as of March 31, 2016, representing a year-on-year rise of 14.2%.

Deposits also showed a year-on-year increase of 13.7%, from QAR 45.2 billion to QAR 51.4 billion. Dr. Seetharaman says this increase in deposits was “evidence of the strong liquid-ity position of the bank.”

He also notes that Doha Bank has achieved a rate of return of 1.69% on assets, “which is a clear demonstration of the ef-fective utilization of sharehold-ers’ funds and optimum asset allocation strategies.”

QNB, Commercial Bank and Doha Bank are amongst the largest of Qatar’s 14 conven-tional banks. The country also has four Islamic banks, includ-ing Qatar Islamic Bank (QIB), the country’s first. According to Ernst & Young, global Islamic banking assets grew at an an-nual rate of 17.6% between 2009 and 2013.

Bassel Gamal, Group CEO of QIB, says that strong growth is

“predicted to continue into the foreseeable future.”

QIB enjoyed profits of QAR 1.95 billion for the year 2015, which represented a strong 22% increase over 2014.

Another Islamic lender, Mas-raf Al Rayan, saw net profits of QAR 2.07 billion in 2015, an in-crease of 3.6% compared to the previous year. Group CEO Adel Mustafawi says Islamic finance “has proven to be resilient dur-ing challenging economic cycles and has demonstrated strong support for the economy and its customers during challeng-ing phases.”

Furthermore, according to CEO Tamim Al-Kawari, 2015 was a record year for Qatar’s leading investment bank QIn-vest. “We recorded the highest revenue since inception of QAR 393 million and net profit of QAR 154 million. We have gen-erated consistent performance throughout 2015 despite chal-lenging global economic condi-tions and regional volatility, cul-minating in an increase in both revenues and net profit of 32% and 76% respectively. Addition-ally, we recommended doubling the dividend to shareholders for financial year 2015.”

Qatari banks enjoyed asset and profit growth in 2015, despite the challenging global economic conditions and regional volatility. Analysts warn that Qatari banks face tightening liquidity and weaker credit growth, however the Qatar Central Bank says it will “continue to actively manage liquidity” to keep credit flowing to the real economy

United vision and collaboration pave the way for enhanced regulatory reformThe combined efforts of the Qatar Central Bank, the Qatar Financial Markets Authority and the Qatar Financial Center Regulatory Authority are creating a coordinated approach to develop financial regulatory infrastructure that meets international standards and best practices

From left to right michael ryan QFCrA , nasser Ahmed Al-Shaibi QFmA , and Sheikh Abdullah bin Saud Al-Thani QCB have jointly developed Qatar’s first Strategic plan for regulation

Source S p rated banks’ financial statements Source atartodayonline.com

PERFORMANCE METRICS OF BANKS IN QATAR MARKET SHARE AS AT DECEMBER 2015

0

2

20

1

10

0

1.6

2.

1.7

21.8

10.

12.8

16.8 .0

26.7

2.1

11.

17.1

20.

2. 7. 6. 11. .7 1.7 1. 1. 2.0 2.0 1.8 2.7 2.8 2. 2.2 2.1 1.

2010

2011

2012

201

201

201

2010

2011

2012

201

201

201

2010

2011

2012

201

201

201

2010

2011

2012

201

201

201

2010

2011

2012

201

201

201

Asset growthnet loan growth

net income growthnon-performing loans

return on average assets Qatar national BankCommercial BankDoha BankKhaliji BankAhli BankQatar Islamic Bankmasraf Al rayanQatar International Islamic Bank

0

11

8

12

7


QATAR Friday, October 7, 2016Distributed by USA TODAY

Reforms, economic resilience set stock market on path to growth and more listings

While economic uncertainties and market worries have

hit markets globally over the past year, the Qatar Stock Ex-change (QSE) has positioned itself well to weather the storms and set the stage for future growth and expansion.

A combination of regulatory reform, the Gulf country’s suc-cess in widening its economic base, solid economic growth, some good news from rating agencies, and a likely string of new listings on the nation’s ex-change are providing grounds for optimism.

In the year since July 2015, Qatar Stock Exchange’s index fell around 18%, although its losses were less severe than those seen in fellow Gulf Cooperation Council (GCC) members Saudi Arabia or Dubai. However, since Janu-ary, the decline by the Qatar index has slowed markedly, to a loss of 4.84%, despite the continuing problems caused by low energy prices, the fall-out from military conflict in parts of the Middle East, and the turmoil that has resulted from the UK’s Brexit vote.

“We could not escape some of the events around us, such as the drop in oil prices or po-litical upheavals and tensions in the region,” acknowledges Rashid bin Ali Al-Mansoori, CEO of the QSE.

“But the Qatari economy re-mains strong. We saw evidence of this when companies listed on the Qatar Stock Exchange distributed very generous divi-dends at the beginning of the year,” he adds.

Qatar, with its population of just 2.2 million, has proven oil reserves of more than 25 billion

barrels, enough for 56 years of production at current levels, and its natural gas reserves are the world’s third largest.

Mr. Al-Mansoori argues that a combination of forward planning by the Qatari govern-ment, the use of effective fiscal controls, and diversification of the country’s revenues – more than 50% of Qatar’s GDP now comes from the non-hydro-carbon sector – are setting the stage for a brighter future.

While Qatar’s GDP is still largely driven by oil and gas earnings, things are chang-ing. It is insulating itself from low energy prices by achiev-ing a substantial expansion in manufacturing, construction and financial services. Plus, it was the only GCC member that avoided a budget deficit in 2015, although it is project-ing a $12.8 billion deficit, 6% of GDP, in 2016.

Some of the optimism about the future of the ex-change has been generated by a new listing, the first this year, bringing the total to 44. In April, financial firm Qatar First Bank (QFB) became the first private-sector company to appear on the exchange in six years and the first bank to be added in nine years. QFB, previously known as Qatar First Investment Bank, focuses on Sharia-compliant financial and investment services.

The previous new listing was back in 2014, when Mesaieed Petrochemical Holding Co., a subsidiary of state-owned Qa-tar Petroleum, was floated and was the first new entrant into the bourse since 2010.

Local media reports have suggested that several other large state-owned enterprises – including Qatar Airways,

media group Al Jazeera and transport operator Mowasalat – have been considered for public listing.

Additionally, more privately held companies are eyeing pos-sible share issuance. UrbaCon Trading and Contracting, one of Qatar’s largest construction firms, and building company Aljaber Group, are among them, local media reports say.

Also, family-run bottled water supplier Rayyan Min-eral Water Co. may be floated by the end of this year. If so, it would be the first consumer goods company to list on Qa-tar’s exchange, which is domi-nated by financial and real estate firms.

With a listing there will be “better control, better regula-tions and corporate gover-nance. Business is not a one-man show anymore. An IPO is protective for the interests of our company,” Khalifa Khalid Al Rabban, Deputy Chairman of Al Rabban Holding which owns 100% of Rayyan, said in a June interview with Reuters news agency. Companies that list on exchanges are subject to the rules, regulations and cor-porate governance standards of the markets they join.

The exchange is keen to see this type of new issuer. “We know there are many suc-cessful companies in the non-hydrocarbon sector owned by families, and we need to dem-onstrate to them the advantages of being listed on the exchange. This also broadens our offering to the investor community,” says Mr. Al-Mansoori.

His ambitions have been given a boost by some impor-tant pieces of news.

In February this year, Stan-dard & Poor’s affirmed its ‘AA’ long-term and ‘A-1+’ short-term foreign and local curren-cy sovereign credit ratings for Qatar, despite the large fall in

energy prices seen since 2014, saying the country’s outlook is stable and will see economic growth of about 4% in 2016-2019. This comes at a time when S&P has downgraded Qatar’s Gulf neighbors, Oman, Bahrain and Saudi Arabia.

Secondly, the benchmark FTSE Russell index, effec-tive this year, has upgraded Qatar’s status to “secondary emerging” from “frontier”, reinforcing a similar upgrade from global index compiler MSCI in 2013.

“We have witnessed in-creases in the number of in-ternational investor accounts being opened and have been delighted with the progress we are making in boosting Qatar’s image around the world. Our operational and regulatory im-provements have resulted in us being upgraded by MSCI and now by FTSE Russell,” says Mr. Al-Mansoori.

Qatar’s status as a reliable investment environment was reinforced by the decision of the World Federation of Ex-changes, which represents 63 regulated exchanges across the world, to hold its 2015 annual meeting in the Gulf country.

The exchange is also trying to enhance Qatar’s investment environment through a variety of means, including programs with its listed companies to promote environmental awareness and sustainability, as well as “talking with our stakeholders and the regula-tor, with a view to improving market rules to ease access and boost confidence so that our market becomes more attrac-tive and relevant for the inves-tor community as a whole,” Mr. Al-Mansoori adds.

“We would like to see more investors and companies from the United States who are in-terested in working with us, our asset managers, financial institutions and investors.”

One area of focus which should Qatar’s exchange de-velop further is the country’s reforms to its Islamic banking and investment rules.

In December last year, the Qatar Financial Center Regula-tory Authority announced var-ious such reforms, moves that the regulator’s CEO Michael Ryan said would provide a solid platform for future growth in financial services.

Mr. Al-Mansoori has said that efforts are under way with a local asset manager to launch the world’s largest Sharia-com-pliant Exchange Traded Fund: “It is ongoing and we hope it will be launched this year. Insha’Allah (God willing).”

Even non-Islamic countries and investors trust Islamic finance as it shows resilience in any crisis, he notes, adding: “Islamic financial institutions have remained strong even through all the recent crises. Islamic finance is now becom-ing particularly prevalent and accessible across Europe.”

“Great strides have been made by Qatar in promoting the country as business friend-ly and welcoming,” concludes Mr. Al-Mansoori, pointing to the impact of long-term plan-ning aimed at achieving this, such as the Qatar National Vi-sion for 2030.

The first listing of a private company in six years in April has generated renewed optimism around the QSE, whose CEO says that there has been an increase in the number of international investor accounts being opened

“We know there are many successful companies in the non-hydrocarbon sector owned by families and we need to demonstrate to them the advantages of being listed on the exchange. This also broadens our offering to the investor community”

rAShID BIn AlI Al-mAnSOOrI, CeO, Qatar Stock e change

“We have witnessed increases in the number of international investor accounts being opened and have been delighted with the progress we are making in boosting Qatar’s image around the world. Our operational and regulatory improvements have resulted in us being upgraded by MSCI and now by FTSE Russell”

rAShID BIn AlI Al-mAnSOOrI, CeO, Qatar Stock e change


Friday, October 7, 2016 Distributed by USA TODAYQATAR

U.S. at the forefront of Qatar’s intensified investment strategy

Speaking from the U.S. Embassy office in Qatar in June 2016, U.S. Ambassador to

Qatar Dana Shell Smith set the tone for the burgeoning financial relations between the two countries: “There are so many opportunities here for American businesses, and Qatar has discovered that there are a lot of investment opportunities for them in the United States.”

These comments come at a time when the Qatar Invest-ment Authority (QIA) has pledged to invest $35 billion into the United States over the next five years, with $7 billion already spent in 2015.

The investment decision from the QIA is a colossal move for the emirate, and is a result of strengthening bilateral relations between the two nations. This stems from the U.S.-Qatari trade relationship that has grown exponentially in recent years after the signing of a bilat-eral Trade and Investment Framework Agreement (TIFA) in 2004.

Qatar is one of the United States’ most important trad-ing partners in the region. In 2014, U.S. exports to Qatar reached $5.2 billion, while Qatari exports were valued at approximately $1.7 billion, according to the Office of the

U.S. Trade Representative. The increased trade and in-vestment opportunities have fostered business relation-ships for both countries and are creating jobs for Qataris and Americans alike.

“Our bilateral trade rela-tionship is growing every day. Last fall we inaugurated an Economic and Investment Dialogue between the United States and Qatar to establish a platform for enhanced eco-nomic cooperation,” explains Ms. Smith. “Qatar is a grow-ing export destination for U.S. products. From 2004-2014, U.S. exports to Qatar grew nearly tenfold, eclipsing for the first time $5 billion on an annual basis.”

U.S. involvement through-out Qatar’s private sector varies from large corpora-tions to SMEs to employees in Qatari companies. There are currently six prestigious

U.S. universities that have full campuses in Qatar, as well as American contracting gi-ants AECOM, Bechtel, and CH2M Hill that were recent-ly awarded major contracts for Qatari infrastructure projects, including a $16 bil-lion airport that was com-missioned in 2014.

Furthermore, there are several companies that not only provide a service or equipment, but also act as a support business to vital in-dustries – like Boeing, which works with Qatar Airways and also supports the defence and security sector.

As a strong ally of the U.S., Qatar has played a key part in diplomacy on the issues of terrorism and resolving conflicts. Chairman of the American Chamber of Com-merce (AmCham) in Qatar, Robert A. Hager, explains: “It is worth highlighting Qatar’s position in the region, not only as a strong ally of the U.S., but also as a country that is able to keep relations with countries with whom we need to have dialogue.” The ongoing move to solidify ties is not only commercial but political which acts in both parties’ interests.

Meanwhile, the shock on oil prices has applied seri-ous pressure on Gulf States to diversify their economies,

eightened cooperation in education securit trade and QIA’s strateg shi t investing $35 billion in the American economy, set a new milestone in the bilateral relations

Banking champion sets sights on global expansion

Despite worries that the global banking sector is facing a turbulent future

potentially repeating the 2008 crisis when finance sec-tor shares collapsed and major players like Lehmann Brothers went to the wall, the interna-tional ambitions of Qatar Na-tional Bank (QNB) may not be unrealistic.

It is dominant in its domes-tic market, is already operating in some key foreign markets, has a healthy balance sheet, en-joys good ratings, and can rely on the financial heft of Qatar’s government, which has a 50% stake in it.

“International expansion is one of the cornerstones of QNB Group’s strategy to achieve its vision of becoming a leading bank in the Middle East, Africa and Southeast Asia by 2020, and a global bank by 2030,” says QNB’s Group Chief Executive Officer, Ali Ahmed Al-Kuwari.

“When looking at growth opportunities globally, QNB Group has identified a set of markets in sub-Saharan Africa and Southeast Asia as the focus areas for further expansion.”

In June this year, QNB completed the acquisition of a 99.81% stake in the fifth-largest private Turkish bank, Finansbank, aiming, as it said at the time, to use the purchase to “benefit from the rapid de-velopment of trade and the strengthening of economic ties between Turkey and the Middle East in general, as well as between Qatar and Turkey in particular.”

The Turkish bank is a lot to digest, given that it has 620 branches, more than 12,000 employees, and as at the end of March its total assets are worth $32 billion.

“Our strategy is to focus on high-growth markets where we see a competitive advan-tage. Turkey, with its signifi-cant market size, population, growth track record, strong economic and banking sec-tor, and strategic location as a gateway between Europe, Asia and Africa, represents such a market,” says Mr. Al-Kuwari.

QNB, which opened its first Gulf Cooperation Coun-cil (GCC) country branch in Oman in 2007, has also been venturing into big Asian coun-tries. In 2013, it opened a rep-resentative office in China and established a fully owned sub-sidiary in India, and last year set up a representative office in Vietnam.

It also has a substantial presence in Egypt, Jordan, the UAE, Iraq, Tunisia and Libya, as well as stakes in banks further afield includ-ing in Indonesia. In 2014, it increased its holding in To-go-based pan-African lender Ecobank Transnational to 23.5%, becoming its domi-nant shareholder. QNB now has branches in 27 countries.

The QNB boss has indicated that more acquisitions are only a matter of time.

“QNB will continue to ex-pand its international network and footprint through strate-gic and opportunistic inorgan-ic growth. Target markets are selected frontier and emerging markets that characterized by a favorable macroeconomic outlook, a growing and healthy banking sector, as well as the availability of suitable targets,” he says.

The bank’s performance, goals and strategy has been recognized by leading fi-nance publication Euromoney, which in 2015 named QNB as the best Middle East bank for the second consecutive year.

“Rather than just building offices and growing organi-cally on the back of an inter-nationally active Qatari client base, the pattern has been to buy into an existing enterprise and take advantage of the deep roots that come with it,” com-mented Euromoney.

QNB’s moves abroad come at a difficult time for interna-tional banking. Already buf-feted by economic slowing in powerhouses like China and the slump in most global commodity prices, banks now have to cope with a range of new uncertainties which could undermine their hopes for the future.

These include the UK’s vote to leave the European Union and other global events with the potential to rock markets, like economic and political tensions within the EU and upcoming elections in the U.S., France and Germany.

The vote for Brexit prompt-ed rating agencies to cut the standings of British-based banks, which include some of the world’s largest. While banks in the GCC are insulated for now from the fallout from Brexit, a widening of that crisis could have an impact on QNB and other banks in the region.

Even before Brexit, Moody’s, in its 2016 banking sector outlook, warned that while banks in many countries had improved their capitaliza-tion and strengthened their balance sheets, risks such as weakening asset quality in emerging markets could derail progress. Euromoney too has warned that risk has reached levels “that do not preclude another global shock if China hits the skids.”

Mr. Al-Kuwari, however, believes his and other Qatari banks are well placed to weath-er the uncertainties ahead.

“The banking sector in Qatar is very healthy. Return on equity was 16.2% in 2015, with a very low level of non-performing loans. As of April 2014, banks have already fully complied with Basel III capi-tal adequacy standards, with a capital adequacy ratio of 15.6% at end-2015. Strong supervi-sion by the Central Bank and

very prudent lending policies ensure that the strong health of the Qatari banking sector will continue in the future,” he argues.

That is not to say that the Brexit does not pose a threat to banks in Qatar or the Gulf region, as their growing in-ternational presence leaves them more exposed to global headwinds.

“Our baseline view is that the risks are likely to be contained in the UK and, to some extent, the Euro area. But contagion to the rest of the world through trade and, especially, financial market linkages could pose a real risk in the future,” QNB’s research department said in a recent report.

QNB’s financial health pro-vides a strong base for its ex-pansion abroad. “The strong and robust nature of QNB Group’s performance in 2015

was reflected in the delivery of record financial results. Net profit rose to QAR 11.3 bil-lion ($632 million), up by 8% compared to 2014,” notes Qa-tar’s Minister of Finance and Chairman of QNB Group, Ali Shareef Al-Emadi.

QNB’s total assets increased by 11% to reach QAR 539 bil-lion ($148 billion), the highest it has ever achieved, with this underpinned by a 15% growth in loans and advances to QAR388 billion ($107 billion).

“QNB Group accounts for nearly half of the Qatari banking system’s assets and is today the largest bank in the Middle East and Africa across all financial metrics,” Mr. Al-Kuwari notes.

A survey, carried out in 2015 by Brand Finance and published by The Banker magazine, listed QNB as the most valuable bank brand in the Middle East and North Af-rica in terms of assets, ahead of National Commercial Bank of Saudi Arabia and the National Bank of Abu Dhabi. (However QNB may soon lose its num-ber one ranking following the recent merger of National Bank of Abu Dhabi and First Gulf Bank in July).

Qatar’s leading Islamic bank is another with ambi-tious overseas targets, aiming for a dominant position in the rapidly growing market for Sharia-compliant financing.

Qatar Islamic Bank has a 43% share of the country’s

he largest bank in the iddle ast and A rica Qatar ational ank Q has a plan keep expanding internationall and elevate its status to that o a global bank ith extensive operations in several continents everal other o the countr ’s banks are also e eing up opportunities abroad

Islamic financing sector and already is one of the largest Islamic banks in the MENA region. In April, it reported higher-than-forecast jump of 23% in first-quarter net profits.

“We have a presence in UK, through our wholly owned sub-sidiary QIB-UK and opened a branch in Sudan. We have also presence in Lebanon through Arab Finance House, Malaysia through Asia Finance Bank. We have activity in Saudi Ara-bia and Turkey through QIn-vest, QIB Group’s investment banking arm,” notes Bassel Ga-mal, Group CEO of QIB.

“Concerning QIB-UK, dur-ing the last few years we have developed a new strategy and completely restructured the business and operating model to focus on serving our high-net-worth clients by address-ing their specific financial needs and delivering business growth within a rigorous risk and control framework. To support the new customer proposition, QIB-UK bought a five-storey office building at the heart of London’s affluent Mayfair district.”

Qatar’s second-ranked Is-lamic bank, Masraf Al Rayan, is also looking outwards, as well as being a driver of plans to cre-ate the world’s largest Sharia-compliant Exchange Traded Fund, due to be launched on the Qatar Stock Exchange later this year, and is making efforts to bolster Qatar’s ranking in the world of Islamic financing.

“We are always looking for opportunities to grow organi-cally and through acquisitions. Since the acquisition of the Al Rayan Bank Plc in the UK we have been exploring other op-portunities in the GCC, North Africa and Southeast Asia. We are also seriously consid-ering expansion into Europe through Al Rayan Bank Plc,” says Adel Mustafawi, Group CEO, noting that the UK franchise has assets in excess of $1.45 billion.

Foreign expansion is also a key driver for the second-

largest conventional bank by assets, the Commercial Bank of Qatar, founded in 1974 and the country’s first private bank. “Commercial Bank is always trying to find the right opportunities, whether locally or internationally,” says CEO Joseph Abraham.

“Extending our sights and ambitions beyond Qatar, we first looked within the GCC as these countries are similar in terms of language, customs and way of living.”

He adds, “Our associ-ate banks, National Bank of Oman in Oman and United Arab Bank in the United Arab Emirates, have diversified our income streams, and despite the difficulties that Dubai is going through at the mo-ment we believe it is a prof-itable market and that there are plenty of opportunities to grow there even more.”

His bank took a majority stake in Turkish bank ABank in 2013, and while “the cur-rent political situation there and the depreciation of their currency is presenting some short-term challenges…in the long run Turkey has the po-tential to become one of our leading subsidiaries.”

Mr. Abraham says, “Our diversification efforts have

proved successful to date and we are always willing to con-sider new opportunities in dif-ferent markets as part of our growth plan.”

In January, Commercial Bank signed a memorandum of understanding with Ban-comext, a Mexican national development bank. And in March its shareholders ap-proved the launch of a global medium-term notes program to allow for the issuance of bonds to U.S. investors worth up to $2 billion.

Sheikh Abdullah bin Saud Al-Thani, Governor of the Central Bank, says, “The expansion of operations of Qatar-based lenders interna-tionally is in itself an indication of the increasing strength and confidence of these banks to compete with others in the international arena.”

“We are always looking or opportunities to gro

organically and through ac uisitions ince the ac uisition o the Al Ra an ank lc in the

e have been exploring other opportunities in the

CC orth A rica and outheast Asia”

ADel mUSTAFA I, group CeO, masraf Al rayan

“When looking at growth opportunities globall Q roup has identi ied a set o markets in sub aharan A rica and outheast Asia as the ocus areas or urther expansion”

AlI AhmeD Al-KU ArI, group Chief e ecutive Officer, QnB

e have gro n rom a manu acturing based to a service based economy – an economy more and more based on small knowledge-based units e see that is ver complementar

ith Qatar”

rOBerT A. hAger, Chairman, AmCham, Qatar


QATAR Friday, October 7, 2016Distributed by USA TODAY

which are heavily dependent on oil and gas exports. This strain, has forced Qatar to look outwards for growth opportunities elsewhere.

Mr. Hager notes, “You cannot depend on a com-modity-based economy long term; you need to be able to diversify. It is important for U.S. business to be a part of this, and to assist with this, because it also fits with the U.S. vision. We have grown from a manufacturing-based to a service-based economy – an economy more and more based on small knowl-edge-based units. We see that is very complementary with Qatar.”

Qatar doesn’t divulge the size of its assets, but accord-ing to the London-based Wealth Fund Institute, it es-timates its holdings at $256 billion, ranking it ninth in the world. While the Gulf country’s strategic objec-tive is to diversify its assets overseas, neighboring Saudi Arabia is liquidating its as-sets to strengthen its finances against declining crude oil prices. The oil-rich king-dom is speculated to have withdrawn $70 billion from global asset managers in an attempt to remedy its budget deficit, according to financial services market intelligence company Insight Discovery.

The Doha-based QIA has traditionally invested in the European market with a particular focus on London, devoting its wealth to assets ranging from Barclays Plc to Total SA and commodities trader Glencore Plc. Last year, the Authority spear-headed a group of investors to buy London’s Canary Wharf financial district in a deal that valued owner Songbird Estates Plc at about $3.94 billion.

However, the prevailing American economy has spurred the QIA to recently establish an office in New York, a move which Ambas-sador Smith calls “another milestone” in the trade and investment relations be-tween the two nations.

In a statement made by Ali Shareef Al-Emadi, Qatar’s Minister of Finance, “Qa-tar is to invest in U.S. tech, health care, real estate and infrastructure.” While this commitment to source new deals locally is a statement, the group is no stranger to American investment, with the fund buying a stake in movie distributor Miramax and luxury jeweler Tiffany & Co.

With that said, the most recent flagship investment, has been Qatari Diar’s (the real estate arm of the QIA) co-investment in a $1.5 bil-

lion mixed-use development in downtown Washington D.C., completed in 2014. The CityCenterDC has been one of the largest downtown de-velopments in the U.S. capi-tal – a pedestrian-friendly, mixed-use development that spans over 147,000 square meters and is Qatari Diar’s first significant investment in the U.S. property market. It has already realized tremen-dous success, having leased 100% of its office space, and sold more than 85% of its condominium residences, as well as leased more than 85% of its apartments.

The Minister of Finance, who is also the Chairman of Qatari Diar, claimed that the CityCenterDC’s success allowed the company to com-mence a new project, a five-star hotel in the fall of 2015.

The sovereign wealth fund’s decision to target new and existing investment partners is a sign of the gas-rich county’s investment strategy in the long term.

“I think it is a reflec-tion that our economy is still growing, and despite the difficult years that the whole global economy has had, QIA has recognized that our economy has the most potential for growth,” concludes Ms. Smith.

Amongst QIA’s U.S. investments is a stake in jeweler Tiffany Co.

New investment law to give foreign investors more access to local market

In mid-2015, Qatar Fi-nancial Center (QFC) appointed its new CEO, Yousuf Al-Jaida, who,

after having joined the QFC Authority in 2010, had also served as its Deputy CEO and Chief Strategic and Business Development Officer. Speak-ing of Mr. Al-Jaida at the mo-ment of his appointment, the Minister of Finance and Chair-man of the QFC Authority, Ali Shareef Al-Emadi, declared that the new chief executive was a driving force of QFC’s strategy and would “ensure the QFC continues to contribute to Qatar’s economic diversi-fication” – a role that Mr. Al-Jaida has taken on in earnest.

His recent appointment comes at an exciting time for QFC, as it continues to grow in the local market as well as in its offerings to in-ternational firms looking to expand their operations in Qatar. Mr. Al-Jaida is to be instrumental in the imple-mentation of a new law which will improve and ease access for foreign businesses looking to operate in Qatar.

Since its establishment in 2005, the QFC, located in Qatar’s financial center, Doha, has been a gateway to onshore business and has facilitated foreign investment through its unique business and finan-cial platform. QFC has its own legal, regulatory, tax and busi-ness infrastructure and envi-ronment. It allows for 100% foreign ownership and un-limited repatriation of profits, along with a corporate tax of 10% on locally sourced profits. Unsurprisingly, the QFC has been in steady growth since its inception.

With currently more than 300 companies registered, members represent a spec-trum of sectors and are a combination of domestic and foreign firms. It is clear that the QFC has been di-versifying its registry, envel-

oping various sectors, both local and international – in fact, there has been a 25% year-to-date increase in the number of non-financial sector firms licensed, and 30% of firms are now Qatari entities. Some international firms include Bennett Jones LLP (legal services), Accen-ture (consulting), insurance companies such as AXA, and banking giants like Deutsche Bank, Citibank and UBS. In this way, QFC has been con-tributing to Qatar’s growing regulated and non-regulated sectors for over a decade.

In a recent press conference, QFC’s Chief Commercial Of-ficer, Raed Al Emadi, projected an approximate growth of 10% in the number of registered companies in 2016 compared to 2015 – a promising figure given the global economic environment and the steady decline of oil prices.

GCC Financial Center of the YearThe QFC’s impact is expand-ing beyond Qatar’s borders, as it positions itself at the forefront of the development of financial markets through-out the Middle East, continu-ing to gain in the region, and becoming increasingly com-petitive, comparative to the Dubai International Financial Center (DIFC).

In 2015 the QFC was awarded as the GCC Finan-cial Center of the Year in rec-ognition of its achievements in 2014, including its 20% growth and the expansion of its unique platform.

Sadiq Hamour, Director of Business Development at the QFC, accepted the award, stating “At the QFC, we remain committed to facilitating our firms’ success by both enabling local firms to expand regional-ly and attracting international firms to Qatar to benefit from the growing business opportu-nities here, thereby allowing us

to continue contributing to the diversification of both Qatar’s and the region’s economies.”

Indeed, Qatar’s economy is moving away from one found-ed solely on the exploitation of its petroleum and natural gas resources, and towards one that is supporting the na-tion’s development as well as the region, particularly their markets, expanding the pri-vate sector, and fostering and strengthening ties between its energy-based economy and global financial markets.

Diversifying the economy in this manner is not the only way Qatar is fueling its growth. It is also moving to-ward transforming itself into a knowledge-based society. At a QFC-organized event in June, attended by some 450 guests, Mr. Al-Jaida spoke of Qatar’s potential: “Qatar has the nec-essary means, resources and talent, and today more than ever, the opportunity to lead

by example. And this is exactly what the QFC is doing. We are attracting international exper-tise, promoting knowledge-sharing, enabling local firms to expand regionally, contrib-uting to our nation’s economy, and investing in our youth.”

New investment lawEarlier this year, the QFC an-nounced that a new law is to be passed by the end of 2016 that will ease the way for all types of foreign investment. Its main purpose is to simplify proce-dures for foreign investors, and to streamline disparate aspects of existing regulation with an aim to increase for-eign direct investment (FDI) and to aid the nation’s efforts in its economic diversification.

According to Mr. Al-Jaida, the new law will expedite ac-cess to the onshore business environment, giving foreign investors more access to the local market and listing on the stock exchange.

“The new set of laws, which will be more aligned with the rules of Qatar Central Bank (QCB) and other regulatory bodies, will provide the QFC-registered companies more access to the local market, including listing on the Qa-tari [stock exchange] and also help launch Exchange Traded Funds (ETFs),” he says.

Coincidentally, the first private company to list on the stock exchange in six years is

one that is licensed by the QFC – the Qatar First Bank (QFB).

Founded in 2008, the QFB announced that it would list all its shares on the QSE in April, making it the first listing of a Qatari entity licensed by the QFC. Many hope that this will increase activity in the Qatari stock market, and, in particu-lar, boost the participation of the banking and financial ser-vices sector.

In addition, the new law will also introduce regulatory reforms that are specifically aimed at asset management, banking and insurance.

“We are looking into devel-oping the regulatory frame-work with the government before we proceed with a full force in attracting regulated companies,” Mr. Al-Jaida explains. “There are a lot of efforts on the ground with the QFC, QCB, and QFMA (Qatar Financial Market Au-thority) to enable a ‘best-in-class’ regulatory framework in Qatar to attract companies in those areas”

Asset management is cer-tainly a sector that the QFC sees as on the rise. “Asset management is something that we see growth coming from in the future,” says Ka-mal Nagi, QFC’s Chief Stra-tegic and Business Develop-ment Officer.

In talks with the press, Mr. Al-Jaida emphasized the plan for a combined regulatory

framework between the QFC, QFMA and QCB to regulate asset management.

“For asset managers, it is important to be able to set up products quickly, to be able to have access to the stock exchange in terms of listing new products and to be able to raise capital either from the local market or from abroad,” says Mr. Al-Jaida.

Without a proper market set up, he notes, there is not much to attract international asset managers.

“The QFC law allows more room for onshore access,” he continues. “There are cer-tain efforts that cannot be done unless these laws are revised. For the next expan-sion phase, these issues have to be addressed in order to attract more companies. If you want a better market and better stability within the market, FDIs would have to be comfortable in a friendly business environment.”

QFC, an onshore financial and business center, offers its firms 100% foreign ownership, unlimited repatriation of profits, no restrictions on trade currency and a best-in-class business, legal and tax environment

Since its establishment in 200 , the Qatar Financial Center QFC , located in the financial heart of Doha, has been a gateway to onshore business and has facilitated foreign investment through its uni ue business and financial platform

“I think it is a reflection that our economy is still growing, and despite the difficult years that the whole global economy has had, QIA has recognized that our economy has the most potential for growth”

DAnA Shell SmITh, U.S. Ambassador to Qatar

“We are attracting international expertise, promoting knowledge sharing, enabling local firms to expand regionally, contributing to our nation’s econom and investing in our youth”

YOUSUF Al-JAIDA, CeO, QFC



Unprecedented growth of Islamic banking as it looks to enter world stage

The Sharia-compli-ant financial sys-tem is worth some $1.88 trillion, ac-

cording to recent figures released in May by industry monitor, the Islamic Finance Services Board (IFSB). The organization was bullish in its growth estimates, stating that the number could increase to $3.4 trillion by 2018.

Observers at the World Bank have noted what they called the industry’s “rapid” growth. The group chalked Islamic finance’s rise up to a “heightened interest in financial instruments that emphasize risk sharing” in the wake of the most recent financial crisis.

Other reports show Islamic banking has also performed well in recent years, valuing the industry at $1.34 trillion in 2014 – a year in which the sector grew by 12%.

“Over the years we have seen faster and consistent growth of Islamic finance assets as infrastructure de-velopment and the general economy as a whole contin-ues to grow together. In ad-dition, the widening of our customer base as Islamic fi-nance becomes more under-stood and appreciated across the mainstream segment provides a major boost to support growth. We project that the demand for Islamic finance will continue on a positive growth trajectory going forward into the next decade,” says Adel Musta-fawi, Group Chief Executive Officer at Masraf Al Rayan, a Qatar-based Islamic bank.

Industry insiders say Is-lamic finance enjoys crucial “advantages over convention-al financial products.” Mah-moud Mohieldin, a Senior Vice President at the World Bank and former Egypt in-vestment minister, wrote in a recent column that, “[Islamic finance]’s prohibition of in-terest and requirement that investments be linked to the real economy, together with its approach to profit- and loss-sharing, add stability to the financial sector.” Mr. Mo-hieldin added that Islamic fi-nance can promote financial inclusion for those who, for cultural or religious reasons, are excluded from the tradi-tional financial system.

“This is perhaps one rea-son why Islamic finance has been expanding at 10-12% per year over the last decade or so,” he wrote.

Although a study by the In-ternational Islamic Financial

Market showed the issuances of Islamic bonds, known as sukuks, have dropped signifi-cantly since 2013, the mood around the industry remains positive.

“Islamic banks are now targeting all segments by competing and acquiring not only Sharia-compliant sensi-tive customers but also value-seeking customers who find the Islamic products pricing and offerings comparable to that of conventional banks,” says Bassel Gamal, Group

Chief Executive Officer at Qatar Islamic Bank (QIB).

Qatari banks find Western AlliesMuch of that value has been found in the ongoing inter-nationalization of Islamic finance. The industry main-tains increasingly strong ties to not just world centers of Islamic culture, but also pow-erful financial hubs like Lon-don or New York. Indeed, the UK government issued a GBP £200 million sovereign sukuk in 2014—a relatively small amount, but still one a BBC commentator claimed was “a signal of intent.”

In Qatar, business leaders say the country’s ties with the United States have also strengthened.

“The U.S.-Qatar bilateral relationship is an important one. The U.S. plays a very im-portant role in supporting the strategic mission of Qatar, in terms of trade, investments, banking and finance, in ad-dition to defense, education, as well as political and social responsible executions,” said Dr. Ragharan Seetharaman, CEO at Doha Bank in Qatar.

“The surge in trade and other bilateral relationships between Qatar and U.S. is going to improve synergies between them and thereby contribute to investment flows between them. Bilat-eral investments and trade can go in the right direction

Business leaders in Qatar and around the world say Islamic banking and finance is set for continued growth that may last until the end of the decade

thereby banking can play a bigger role.”

Other Qatar-based execu-tives found the tighter con-nections to the West to be a demonstration of the quick-ening evolution of Islamic finance.

“When we first started to invest, it took a lot longer to do any Islamic financing, be it sukuk or bank financing. Today it is much more ac-cepted and the documenta-tion is more standardized,” says Tamim Al-Kawari, Chief Executive Officer at QInvest, a Qatari investment firm (QInvest’s varied inter-national dealings include a serviced apartment redevel-opment project in the City of London).

“We do not really think of the Islamic finance mar-ket being different from any other market (…) The way we look at things and the way we would hope other treasurers, companies and actually any-body looking for funding or capital, is to look at Islamic finance as a different source of funding.”

Qatar growing into an Islamic banking powerhouseCurrently, the top markets for Islamic banking and finance in the world are in Iraq, Saudi Arabia and Malaysia. Togeth-er they account for almost $800 billion of the industry’s total worth. But as Islamic banking and finance’s global influence has spread, other nations are starting to ben-efit from its Sharia-compliant banking system.

That has led to increased calls for government re-forms of Islamic financial instruments. The World Bank’s Mr. Mohieldin wrote in his column that new sets of standards and regulations need to be implemented if countries inside the Organi-zation of Islamic Coopera-tion (OIC) want to use Is-lamic finance for economic diversification.

“Topping the list is the need for stronger legal insti-tutions that protect property rights and ensure that con-tracts are enforced. If people are to have full confidence in Islamic financial products, moreover, the industry will need to be standardized and regulated. National tax policies will also need to be tweaked, to prevent dis-crimination against Islamic financial instruments,” Mr. Mohieldin wrote.

In Qatar, statistics show that Islamic banking has be-come one of the country’s primary manners of handling finances. Islamic banking now makes up 26% of the na-tion’s overall banking sector, according to the IFSB report.

“Islamic finance has gained significant ground in Qatar and the Gulf Cooperation Council (GCC). Islamic fi-nance continues to play a major role in shaping the fu-ture of our economy through advancing direct and indirect finance in support of infra-structure and projects; cor-porate and small and medi-um-sized enterprises; retail and private banking needs; and business development,” says Mr. Mustafawi.

Some financial analysts in the country have said that much of the success of Is-lamic banking in Qatar can be pinned to recent reforms put in place by regulators.

For instance, Qatari offi-cials have established arbitra-tion centers to resolve prob-lems with conflicts stemming from the perceived complex-ity of Islamic financial instru-ments. The IFSB report noted that these types of measures have led to the increased strength of the sukuk in Qa-tar. The paper also stated that corporate sukuk issuance in the country had risen by $1.30 billion since 2014.

Additionally, the Qatar Stock Exchange has report-edly said that it will make Is-lamic financing a central part of its recent plans to diversify its offerings.

This all comes as Qatari of-ficials are making a concerted effort to steer the country’s economy toward new sectors.

“Qatar [is in the ongoing process of ] economic diver-sification away from its tradi-tional role as a hydrocarbon exporter. In recent year’s growth has been mainly driv-en by the large-scale projects set by the government as part of the Qatar National Vision 2030,” says Mr. Gamal of QIB.

International recognition for Qatar banksBanks in Qatar are now start-ing to gain international rec-ognition for their business acumen. Doha-based Mas-raf Al Rayan was dubbed the world’s most efficient Islamic bank on the 2015 World Is-

lamic Bank Conference cost-to-income ratio leader board, a global ranking of sharia-compliant financial institu-tions. Masraf Al Rayan’s cost-to-income ratio was 20.6%, a number that demonstrates how successfully the bank kept costs low while increas-ing income streams in 2015.

“Our vision is to build a bank that is strategically po-sitioned and aligned to sup-port our clients and their businesses across the globe,” adds Mr. Mustafawi.

Also coming in the top five of the rankings were the Qatar International Islamic Bank (QIIB) and the Qatar Islamic Bank (QIB), who garnered cost-to-income ratios of 24.47% and 31.78%, respectively.

“QIB’s strategy is to target all banking sectors cover-ing their financial needs in a comprehensive way. Both our corporate and personal portfolios have been post-ing healthy growth, while our local and international subsidiaries and associates contributed positively to QIB’s Group results,” says Mr. Gamal.

According to him, QIB controls more than 43.5% of the Islamic banking market share in Qatar and 11.5% of the overall market, as per the latest figures published by the Qatar Central Bank.

Mr. Gamal is now starting to plan for a prosperous fu-ture not just for his bank, but for Qatar as a whole.

“We are continuously add-ing economic value and try-ing to improve the society as a whole as well as the lives of each individual living in Qatar,” he says. “There is no doubt that the Qatari econ-omy will keep on expanding and diversifying in line with the ‘Qatar National Vision 2030’ and our Bank is in a strong position to support and benefit from the ex-pected growth.”

“We do not really think of the Islamic finance market being different from any other market (…) The way we look at things and the way we would hope other treasurers, companies and actually anybody looking for funding or capital, is to look at Islamic finance as a different source of funding”

TAmIm Al-KA Ari, CeO, QInvest

“Islamic banks are now targeting all segments by competing and acquiring not only sharia-compliant sensitive customers but also value-seeking customers who find the Islamic products pricing and offerings comparable to that of conventional banks”

BASSel gAmAl, group CeO, Qatar Islamic Bank

1 masraf Al rayan - Qatar

2 Qatar International Islamic Bank - Qatar

Bank Kerjasama rakyat malaysia - malaysia

Qatar Islamic Bank - Qatar

public Bank Islamic Berhad - malaysia

6 Al rajhi Bank - Saudi Arabia

7 Ahli United Bank - Kuwait

8 Al- Arfa Islami Bank limited - Bangladesh maybank Islamic Berhad - malaysia10 Jordan Islamic Bank - Jordan

11 hong leong Islamic Bank berhad - malaysia

12 Barwa Bank - Qatar

1 e port Import Bank of Bangladesh - Bangladesh

1 Sharjah Islamic Bank - UAe

1 emirates Islamic Bank - UAe

Source ernst Young

TOP15 GLOBAL ISLAMIC BANKS – RANKED ACCORDING TO COST:INCOME RATIO

“Over the years we have seen faster and consistent growth of Islamic finance assets as infrastructure development and the general economy as a whole continues to grow together. We project that the demand for Islamic finance will continue on a positive growth trajectory going forward into the next decade”

ADel mUSTAFA I, group CeO, masraf Al rayan

QI ’s strateg is to target all banking sectors covering their financial needs in a comprehensive way. Both our corporate and personal portfolios have been posting healthy growth”

BASSel gAmAl, group CeO, Qatar Islamic Bank


QATAR 7Friday, October 7, 2016Distributed by USA TODAY

Financial institutions support Vision 2030 plan through education, environment and sustainability initiatives

As Qatar continues to grow into its role as an inter-national financial

hub, leaders at the nation’s most important financial institution in the country say they are bringing a re-newed focus to corporate social responsibility (CSR) programs in areas such edu-cation, the environment and sustainability, in line with the government’s National Vision 2030.

Investing in education and trainingAli Ahmed Al-Kuwari, Group Chief Executive Of-ficer of Qatar National Bank, says that investment in edu-cation is integral to Vision 2030, which aims to diver-sify the emirate’s economy and make it less dependent on hydrocarbon resources.

“The central theme of [this program] is the cre-ation of a knowledge-based economy, where growth is driven by a productive and innovative workforce. Edu-cation is a crucial element towards realizing this vision through the development of skilled human capital,” says Mr. Al-Kuwari.

Through its CSR programs in education and training, Mr. Al-Kuwari says that QNB is supporting the goals of Vi-sion 2030. For example, the bank has recently partnered with Teach for Qatar, a teach-ing and leadership develop-ment program that places teachers in public schools.

“QNB will endorse Teach For Qatar’s mission and vi-sion through funding and networking opportunities. We will also support the Teach For Qatar program by offering its employees the opportunity to join the Teach For Qatar Fellowship,” says Mr. Al-Kuwari.

QNB has sponsored a number of other educa-tion initiatives, including study abroad programs and career fairs around Qatar. It has also recently signed a memorandum of under-standing (MoU) with the Qatar Banking Studies and Business Administration Independent Secondary School for Boys (QBSBAS) to help train the school’s students across the bank’s divisions.

Another financial insti-tution that is supporting education programs aimed at promoting “knowledge-based” growth is QInvest.

“Obviously, [our] sector is very much human capital driven, and we are commit-ted to supporting the com-munities in which we op-erate,” says QInvest’s CEO, Tamim Al-Kawari.

“During 2015, we launched several corporate social ini-tiatives, further committing to developing the industry and supporting the com-munities in which we oper-ate. We signed an MoU with Carnegie Mellon University in Qatar (a branch of Carn-egie Mellon University in Pennsylvania) to cooperate in the fields of research and education, and for the sec-ond consecutive year the bank welcomed a group of graduates from the Executive Master’s Program in Islamic Finance from Paris Dauphine University,” he adds.

Furthermore, through its QTalent internship pro-gram, QInvest offers recent graduates and final-year undergraduates the oppor-tunity to work in a leading Islamic financial institution, with a diversified and chal-lenging working environ-ment.

Qatar Stock Exchange (QSE) is also investing in ed-

ucation programs to support Vision 2030. CEO Rashid bin Ali Al-Mansoori recently said that the QSE is keen to partner with Qatari uni-versities as part of its CSR strategies to ensure linkage between academia and the finance industry.

“In line with the human, economic and social pillars of the Qatar National Vision 2030, QSE is keen to cooper-ate with the Qatari univer-sities in development and training programs designed to help the link between educational output and the professional life,” Mr. Al-Mansoori told deans and professors of Qatari busi-ness and economic faculties at an event in June.

QSE has also introduced a number of career and so-cial development programs for its staff across all levels.

“We take our responsibili-ties in the spheres of social and human development very seriously, ensuring that we provide support to our staff, members and investors through initiatives in educa-tion and social awareness,” adds Mr. Al-Mansoori.

“We are also active, through programs with our listed companies, in promoting environmental awareness and sustainabili-ty, encouraging them to keep investors aware of their ef-forts and providing regular reports on their activities.”

Green bankingLike QSE, Doha Bank has been particularly outspo-ken on environmental awareness and sustainabil-ity, mainly through its CEO Dr. Ragharan Seetharaman, who is internationally re-nowned for his activism in this area.

“When it comes to envi-ronmental development,

we were the first bank in the Gulf to start talking about green banking. As a matter of fact, we did it 15 years before the green mission started and we are currently part of the global governance summit,” says Dr. Seetharaman.

The Doha Bank executive last year received a doctor-ate degree in green bank-ing and sustainability from Sri Sri University in India. During his thesis defense to the examining board, Dr. Seetharaman argued, “Green banking promotes environment-friendly prac-tices and reduced carbon footprint from banking ac-tivities. The global financial crisis has made me rethink on green banking. Banks, as socially responsible citizens, should earmark capital for green banking apart from capital for regulatory re-quirements.”

He urged banks to “ear-mark a minimum 10% of tier 1 capital subject to a cap of 10% of risk-weighted capital towards green banking or clean development mecha-nism (CDM) or any sustain-able development projects taking into consideration the carbon emissions pre-vailing in the economy in which the bank operates.”

More recently, in May of this year, Dr. Seethara-man received the Green Economy Visionary Award at the Union of Arab Banks (UAB) International Bank-ing Summit in Rome. At the ceremony he highlighted the green banking initiatives un-dertaken under his leader-ship at Doha Bank.

“Doha Bank has promoted paperless banking, internet banking, SMS banking, phone banking and ATM banking, as well as online channels such as Doha Souq,

e-remittances and online bill payments. It has launched its green credit card and green account. It also has a dedi-cated green banking website which integrates the bank’s initiatives in promoting en-vironmental safety with the community by reaching out to both the public and pri-vate sectors,” he said.

Under his leadership, Doha Bank has also helped to finance some of Qatar’s most important green en-ergy developments, such as the construction of Qatar General Electricity & Water Corporation’s water security mega reservoirs project.

“We support projects which encourage climate change mitigation and pro-mote sustainable develop-ment,” says Dr. Seethara-man. “We have supported all this within the scope of Qatar’s four pillars for devel-opment. All this pillars have to converge in substance so that long-term sustainable growth can be ensured for the economy and for its people.”

Award-winning humanitarian workCommercial Bank of Qatar is another bank that sees CSR programs as integral to its business. In Decem-ber the bank won the Best CSR Report award at the corporate social responsi-bility awards ceremony in Doha. The bank was praised for performing a number of humanitarian and CSR ac-tivities over the past three years, including humanitar-ian projects and charitable work for the disadvan-taged; educational, train-ing and personal develop-ment programs for Qatari youth; sports and health initiatives; and support for Qatari arts.

On receiving the award, former CEO Abdulla Saleh Al-Raisi (who was replaced in July by Joseph Abraham) said, “Commercial Bank regards CSR as integral to its business in support of Qatar’s national develop-ment in line with the Qa-tar National Vision 2030. Commercial Bank strives to be an outstanding cor-porate citizen by support-ing local and international socio-economic initiatives that benefit Qatari society as a whole, and we consider this award to be the crown-ing achievement of our CSR strategy.”

espite acing challenging times due to lo oil prices and economic uncertaint Qatar’s top inancial institutions have not let their vital corporate social responsibilit programs su er

“When it comes to environmental development e ere the irst bank in the

ul to start talking about green banking As a matter of fact, we did it 1 ears be ore the green mission started and we are currently part of the global governance summit”

Dr. rAghArAn SeeThArAmAn, CeO, Doha Bank



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Banks and QBIC look to unlock the potential of SMEs and entrepreneurs

Playing a major part in Qatar’s economic di-versification drive is not only the encour-

agement of increased private and foreign investment in non-energy sectors such as financial services, health, education, sport and business-related tourism, but also heightening the role of the private sector through greater participation of small and medium-sized enterprises (SMEs) in order to create a fu-ture knowledge-based economy.

There has been undoubted progress on both these fronts recently, namely: The increased funding and remit for the Qatar Development Bank to assist the development of the private sec-tor; the appointment last year of the Minister of Economy and Commerce, Sheikh Ahmed bin Jassim bin Mohamed Al-Thani, as the new Chairman of the Qa-tar Stock Exchange; the opening of the Qatar Business Incuba-tion Centre – the largest in the MENA region; and the launch of three special economic zones.

What’s more, on top of the sig-nificant decision to augment the maximum level of foreign invest-ment in listed companies from 25% to 49% in 2014, earlier this year the Ministry of Economy took another important step towards increasing private sec-tor participation in the Qatari economy by submitting a draft law covering the use of public-private partnerships (PPP).

The law, which the govern-ment intends to implement by the end of the year, plans to offer 30% of its tenders to SMEs in an attempt to further cultivate the culture of innovation deemed essential for sustainable growth. Also fundamental to helping fur-ther nurture this environment where entrepreneurialism can flourish and form the backbone of a more diversified economy are the country’s financial insti-tutions, which are offering tailor-made services to the sector.

None more so is this the case than with the aforementioned Qatar Development Bank (QDB). Established in 1997 as a

100% government-owned devel-opmental organization, QDB’s traditional aim has been to de-velop investments within local industries, thereby accelerating growth and economic diversifi-cation in Qatar through support for the local private sector.

“QDB aligned its strategy to correspond with the Qatar National Vision for the year 2030, to promote and facilitate development and growth of small and medium enterprises in core economic realms, result-ing in long-term socioeconomic benefits to the people of Qatar,” explains CEO, Abdulaziz Bin Nasser Al-Khalifa.

Since 1998, QDB has granted QAR 4.85 billion ($1.33 billion) in loans and advances to Qatari SMEs. However, in order to do as such, several impediments have needed to be addressed, includ-ing major hurdles that inhibit the establishment, growth and ulti-mately the sustainability and suc-cess of Qatari businesses.

“With regard to our role, QDB adopted several initiatives cap-turing key elements of the SME life cycle. I am glad to note that in doing so we have pioneered several new financing products. Those products include condi-tionally repayable loans to local SMEs to become listed at Qatar Exchange Venture Market as well as holistic support for local growth businesses to become franchisors and grow their busi-nesses internationally,” explains Mr. Al-Khalifa.

The Qatar Exchange Venture Market (QEVM) Program is a joint initiative between QDB and the Qatar Stock Exchange (QSE), with the key objective being to assist potential Qatari SMEs to list their businesses on the QEVM. As part of the Pro-gram, QDB supports Qatari shareholding companies who meet QEVM’s minimum listing and regulatory requirements.

“The program’s innovative structure reflects the challeng-ing transformation that local SMEs have to go through in order to be listed at QEVM. As such, we have structured it through a conditionally repay-able loan, which covers the fees of a Listing Advisor and is to be repaid only in case of successful listing of the SME and, in case of failure, it will be written off,” says the QDB CEO.

Aside from QEVM, the QDB has developed a host of other initiatives, the most recent of which is a memorandum of understanding signed by the Public Works Authority (Ash-ghal) in May, which aims to es-tablish a framework to support

participation of Qatari SMEs in national infrastructure proj-ects. While that scheme is still getting off the ground, two of bank’s most long-established and successful projects have been Al Dhameen and Tasdeer.

“Needless to say that QDB alone will never be able to carry a responsibility of financing local entrepreneurs and SMEs, there-fore, one of the most important initiatives that we launched is Al-Dhameen Partial Loan Guaran-tee Program, which aims to over-come financing barriers faced by economically viable Qatari SMEs.” explains Mr. Al-Khalifa. “The program is designed as a partnership with Qatari banks to improve SME access to financing by covering a significant part of the credit risk. I am glad to note

that Al Dhameen has been suc-cessful both in performance and in changing the culture of SME lending in Qatar, unlocking capi-tal for small businesses. In terms of performance, the program has supported 255 SME projects through providing guarantees for 428 long-term and short-term loans worth QAR 1.138 billion ($312 million).”

The Tasdeer Program’s role, on the other hand, is to pro-vide non-financial support for Qatari SMEs through devel-oping their export capabilities and unlocking access of their

Encouraging entrepreneurs and building a thriving SME sector is integral to the National Vision 2030 plan to develop a sustainable and diversified economy that is not overly dependent on oil revenues. Since 1998, Qatar Development Bank has granted QAR 4.85 billion ($1.33 billion) in loans and advances to Qatari SMEs, while the Qatar Business Incubation Center looks to nurture the emirate’s next QAR 100 million companies

products to regional and inter-national markets.

“During 2015 alone, Tasdeer provided over 140 Qatari SMEs with various exporting opportu-nities while eight Qatari SMEs have become exporters,” says Mr. Al-Khalifa. “Thanks to our sup-port, Qatari SMEs have signed exporting contacts worth over QAR 285 million ($78 million), and last year we supported par-ticipation of 103 Qatari SMEs in eight international exhibitions.”Nurturing the entrepreneurial spiritDespite the resounding suc-cess of QDB’s Al Dhameen and Tasdeer projects, arguably the organization’s biggest overall development since its forma-tion has been the establishment of the Qatar Business Incuba-

tion Center (QBIC). Founded in 2014 by QDB along with the Social Development Center – the country’s other leading en-trepreneurship institute – QBIC has quickly become the largest mixed business incubator in the Middle East.

“Our organization fits within the entrepreneurship, startup development and incubation as-pect of the SME vision that QDB is executing, as well as the Social Development Center,” says CEO of QBIC, Aysha Al Mudahka. “At QBIC, we welcome startups with potential to grow, and equip them with the tools and facilities they need to reach new levels and scale up. Our mission is to create the next QAR 100 million com-panies in Qatar, and to make sure that they survive the initial stages of joining the private sector and eventually grow into an SME.

QBIC’s programs allow en-trepreneurs to partake without having a business plan, or specific degrees required to start a busi-ness. The experts at the incuba-tion center help develop an idea

and quickly transform it into a tangible product or service while being as cost-efficient as possible. The product is then tested in the market to find out how it does with target customers.

One of the latest steps forward at QBIC has been to branch out into sector-specific incubators, recently partnering up with the Qatar Tourism Authority (QTA) to set up QBIC Tourism. QBIC Tourism’s aim is to enable entre-preneurs to develop products and services to enhance the Qa-tar tourism experience, provid-ing them with unique business development tools and access to insight and guidance from QTA decision-makers.

“Their offices are already full of people working on exciting tourism-related projects,” says Ms. Al Mudahka. “We have incubated ten companies so far, and have received hundreds of applications for aspiring entre-preneurs.”

Similarly, QBIC has also part-nered with telecommunications group Ooredoo Qatar, establish-ing another specialized incubator called Digital and Beyond, which focuses on startups with digital solutions in a variety of sectors including: healthcare, sports, public services or finance. “The great thing about this project,” says Ms. Al Mudahka, “is that it exposes our entrepreneurs to the key influencers in the private sector, and grants them access to advisors and mentors in the tech-nology and innovation sector. In line with Qatar’s National Vision 2030, we want to build strong ties with the private sector and increase our entrepreneurs’ input and role within it.”

Aside from government-funded institutions such as QDB and QBIC, private financial insti-tutions are also doing more than their bit to see that Qatar’s Na-tional Vision of creating a more diversified, knowledge-based economy by the year 2030 is realistically achievable.

For example, Commercial Bank of Qatar’s (CBQ) track re-cord of supporting Qatari busi-nesses spans back over 40 years. “This means we understand the fundamental role that SMEs play in the economy by providing the engine for private sector growth and diversity in line with the Qa-tar National Vision 2030,” says Jo-seph Abraham, the bank’s CEO. “This sector has been asleep for some time, and now it is time for it to wake up, which cannot be done without the support of the financial institutions.”

Like with a growing number of Qatari banks, SME banking is now a core part of CBQ’s busi-

ness, with many of the country’s banks also part of QDB’s Al Dha-meen Partial Loan Guarantee Program and having dedicated departments providing special-ized services to entrepreneurs.

“In most cases SMEs are new entrants into the market and they require a management style and processes that are more informal than for large corpora-tions,” says Mr. Abraham. “We have assigned special relation-ship managers for each one of these businesses to make sure that everything is in order, thus minimizing the risk of default.

“There are some brilliant young, well-educated Qataris who are willing to take the chal-lenge and risks to develop their own business. You can see the future in their eyes, which gives us much comfort because we know that these people have enormous potential.”

Another private institution doing its part is Doha Bank, which collaborates with QDB on the Al Dhameen program. According to CEO Dr. R. Seeth-araman, Doha Bank was “the first bank to brand the SME as a prospective solution for a sus-tainable economic backbone of the Qatar economy.”

“We are already geared with a wide range of facilities being of-fered to SMEs, such as medium to long-term loans, short-term working capital financing and overseas trade finance,” he adds. “The Al Dhameen Program has been a very welcomed change. I believe the role of SMEs will be more vital for contributing to the Qatar economy on account of the public-private partnership development.”

At QBIC’s demo day, startups have an opportunity to present their product, market research and financial projections to an auditorium full of judges and fellow entrepreneurs

“Thanks to our support, Qatari SMEs have signed exporting contacts worth over QAR 285 million, and last year we supported participation of 103 Qatari SMEs in eight international exhibitions”

ABDUlAzIz BIn nASSer Al-KhAlIFA, CeO, Qatar Development Bank

“We understand the fundamental role that SMEs play in the economy by providing the engine for private sector growth and diversity in line with the Qatar National Vision 2030”

JOSeph ABrAhAm, CeO, Commercial Bank of Qatar

“The Al Dhameen Program has been a very welcomed change. I believe the role of SMEs will be more vital for contributing to the Qatar economy on account of the public-private partnership development”

Dr. rAghArAn SeeThArAmAn CeO, Doha Bank

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