Introduction to Construction in Qatar

Dariya Alton - Article Contributor and Analyst following Qatar

Harrison Ritchie - Article Contributor and Analyst following Qatar

Josh McLellan - Article Contributor and Analyst following Qatar

Micah Allison – Article Contributor and Analyst following Qatar

Temesghen Naizghi – Article Contributor and Analyst following Qatar

Yaman Aswad - Article Contributor and Analyst following Qatar

Sydney Scott – Article Contributor, Editor and Team Leader following Qatar


Politics and Governance

 The Emirate of Qatar, a small country located in the Middle East, is an oil-rich constitutional monarchy. Sheikh Tamim bin Hamad AL Thani is the current Emir (head) of the gulf state, and is accountable only to Sharia law. Historically, Emirs have used the state’s oil wealth to strengthen their own political powers. There is only one institution in which citizens can participate in elections, being the Central Municipal Council - though it has a limited role in government. However, Qatar is moving towards a more democratic governance model to satisfy its citizens following the Arab Spring. The state has an elected legislative body that holds ministers accountable to the legislature. Still, Qatar’s constitution forbids the formation of any political parties.


 Qatar’s economy is largely based on natural resource extraction. The country has the world’s third largest natural gas reserves at 25 trillion cubic meters and as also holds the title of the world’s biggest exporter of liquefied natural gas (LNG). Qatar is home to at least 25 billion barrels of proved oil reserves which will allow for an estimated minimum of five additional decades of oil extraction at current export levels of 1.522 million barrels per day.

 This abundance of natural resources has allowed Qatar to achieve historically explosive growth. The country’s GDP per capita increased at a rate of more than 1000% in the 1970s, and overall GDP nearly quintupled during the 10-year span between 1995 and 2005. However, Qatar’s reliance on oil and natural gas also exposes the country’s economy to elevated levels of volatility in the global marketplace. The 2016 downturn in oil prices across the world caused Qatar to run an $8 billion deficit and forced the Qatari government to implement measures such as increases in domestic gas prices as well as cuts to electricity subsidies to curb the economic downturn.

 In terms of trade and foreign investment, Qatar’s economy is relatively open and integrated within the global market. The value of Qatar’s imports and exports combined totals more than 90% of the country’s GDP, and the country remains a valued trading partner with many countries around the world including Japan, Germany, and the United States. Foreign investment has also been liberalized in recent years with the Qatari government, allowing foreign companies to obtain complete ownership in businesses activities across sectors ranging from industry to natural resource development. In addition, Qatar’s flat corporate tax rate of 10% serves as a major attraction to foreign companies looking to invest in the country.

 Economic diversification has remained one of the Qatari government’s premier economic goals within recent years. Qatar has continued to support its construction sector through major investment in infrastructure projects. The government has allocated more than $100 billion – or nearly 50% of the country’s national budget – in new infrastructure spending for the fiscal year of 2018. Combined with both the prospect of flourishing tourism as well as the upcoming 2022 FIFA World Cup, there exists a plethora of opportunities for Qatar to diversify its economy past its natural resource sector in the coming years.


 Qatar’s construction industry is growing rapidly. As one of the largest natural gas suppliers in the world, Qatar has ample room for investment in infrastructure. Qatar’s construction sector is projected to witness growth in 2018 as the government plans to spend more than 47% of the national budget on major infrastructure projects. This substantial rise in infrastructure investment is due to the Doha Metro project and the upcoming FIFA World Cup. The tournament will require the construction of 12 new stadiums and 90,000 hotel rooms in order to accommodate an estimated 400,000 tourists.  The opening of the Bulk Materials Handling System at Mesaieed Port has been instrumental in meeting rising demand for materials in key construction projects.

 Foreign investment has played a key role in the construction boom. Qatar's investment policies are gradually evolving based on a desire to protect local companies from rapid competition. Qatar gives preference to suppliers that use local content in bids for government procurement.


With Qatar preparing to host the FIFA 2022 World Cup, the amount of work available in the country continues to increase. As a result, migrant workers have flocked to the region in order to take advantage of this opportunity. Previously, Amnesty international reported that major exploitation of migrant workers was occurring during construction of the stadium, including excessive hours without days off as well as health and safety risks, and unfortunately contractors are continuing this practice of mistreatment. Qatar has recently passed legislation that extends labor rights for domestic workers, however migrant workers are not receiving the same benefits.

 Economic Blockade

Since June 5, 2017, Qatar and its neighboring states have been facing a serious diplomatic crisis. Saudi Arabia, the United Arab Emirates, Egypt and Bahrain have cut ties with Qatar due to Qatar’s alleged support for Islamist terror groups. All 4 countries have also restricted airspace travel for Qatari aircrafts, and Saudi Arabia (the only state bordering Qatar on land) has closed the border between the states.

Saudi Arabia’s decision to close the border has had severe effects on Qatar’s imports.  In order to combat the crisis, Qatar requested assistance from Turkey and Iran for food and supplies, while also working to establish new shipping routes through other countries like Oman. In contrast, Qatar’s main export (liquefied natural gas), has experienced little impact from the blockade.

 Saudi Arabia and neighboring states initially put together a list of 13 demands for Qatar to follow in order for the blockade to subside. Qatar’s failure to comply with the 13 demands resulted in Saudi Arabia and partnering states’ decision to create 6 broad principles, including: combating terrorism and extremism, denying financing and safe havens to terrorist groups, stopping incitement to hatred and violence, and refraining from interfering in the internal affairs of other countries. Qatar has not obliged to these principles and thus the economic blockade is still in place. 

 However, recent data is showing that August imports have jumped 39.1%, only 7.8% below 2016 levels and exports continue to rise. Qatar’s ability to quickly bounce back has demonstrated that the effects of the economic blockade imposed by Saudi Arabia and partnering states are potentially beginning to fade.

 FIFA World Cup 2022

 Qatar is set to host the 2022 FIFA World Cup, although this has not been without controversy. FIFA executives have come under investigation for corruption and selling TV rights to insider companies. Qatar is being accused of abusing migrant workers to build the fields and infrastructure for the tournament. Meanwhile, Kuwait plans to boycott the upcoming event, while Saudi Arabia, Bahrain, the United Arab Emirates and Egypt have cut ties with Qatar, and have instituted the aforementioned However, the world cup will certainly contribute to the an increase in construction, and has already contributed to massive growth in the sector.