Qatar

The following interview with HH Sheikh Hamad bin Khalifa Al Thani, Emir of the State of Qatar, is taken from the Oxford Business Group's latest publication, Emerging Qatar 2004. For more information on how to order a copy of the most comprehensive review of the Qatari economy to date, please write to us at mail@oxfordbusinessgroup.com, or click on the link to Printed Publications on the right-hand side of the page.

International financial institutions are giving Qatar's local banks cautious nods of approval based on newly released results for 2003 - which was a third straight year of success for the sector. With oil prices high and the country's gas revenues also on the up, the banks now look set to continue seeing boom times for several years to come. But the question remains, can they use the current period of prosperity to fortify themselves for long-term success?

Despite the practically no-lose formula of mushrooming gas revenues and lofty national development ambitions, Qatar's construction boom has not been without its glitches. The fourth quarter of 2003 saw work at building sites grind to a halt as supplies of the vital ingredient - cement - dried up. A rash of new projects - and in particular the race to meet deadlines for the 2006 Asian Games - caused demand for the material to far surpass what could be produced by the country's sole cement supplier, the Qatar National Cement Company (QNCC).

The February 13 bomb blast that killed former Chechen president Salim Khan Yandarbiyev on the streets of Doha pulled Qatar briefly into the forefront of the "war on terror". It also highlighted the emirate's difficulty in balancing disparate, often conflicting, political interests, as with it have come international dispute, contradictory accusations and some tough decisions.

With the spotlight often firmly on Qatar's vast oil and gas resources, the country's current - and potential - industrial output can be easily overlooked. Nevertheless, industrial development remains an integral part of the little Gulf state's ongoing ambition to build a viable private sector, albeit from the top down.

In recent years, Qatar's oil exports have closely followed the rise and fall of world oil prices. This has created a budgetary risk for the state, which still relies on oil for more than 40% of its income, despite the fast-rising importance of gas. Not surprisingly, the economic managers of the tiny Gulf state have therefore learned to like predictability, even in boom times. In a recent exclusive interview, Minister of Energy and Industry, Abdullah Bin Hamad al-Attiyah told the OBG he would prefer to strive for price stability in the oil market, for the good of both consumers and producers, rather than ruthlessly attempting to maximize short-term gains.