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Qatari Emir Sheikh Hamad bin Khalifa al-Thani arrives to speak at a natural gas conference.

Companies look to Qatar for work as Gulf state's development continues.

Thanks to its abundant natural gas reserves, Qatar's economy is still one of the fastest growing in the world. According to a report from Global Investment House, nominal GDP growth was a phenomenal 44% in 2008 and GDP per capita reached US $70,630.

Having made clear its intention to invest the receipts from gas sales, analysts predict real GDP growth of 13-18% in 2009. Growth is expected across the mineral and non-oil sectors and this, coupled with rapid population growth, is creating enormous demand for power and water in the country.

Demand for electricity grew 10% year on year in January and by 19% year-on-year in February. Consumption of water rose by an average of 20% year-on-year during the same period. Eisa Hilal Al Kuwari, director of the electricity network of Qatar General Electricity and Water Corporation (Kahramaa), attributed the rise to expansion of the distribution network. This has resulted in a dramatic fall in the number of people relying on water tankers and generators.

Growth and network expansion are all part of the hot-house economic environment that has made the cost of doing business high, with inflation in particular proving to be a burden for fresh start-ups. This burden is expected to reduce slightly, with predictions putting inflation at around 10% for 2009. While the utilities sector in Qatar is still developing, much of this is happening because of the country's ability to feed international utility operations with gas. The resulting industrialisation efforts in the country have generated significant contracts and continue to do so.

Several projects are underway to further boost water and power capacity. The Ras Girtas Company for Power project involves the construction of Ras Girtas independent water and power plant in Qatar. The plant capacity is 2 730 MW of electricity and 63 million gallons per day of potable water, and will be located in Ras Laffan. When the plant is operational it will almost double the electricity generation of the country according to reports in the media.

It is also expected to boost desalinated water production by around 33%. If the plant allows the country to exceed its generation needs it could lead to some of the first commercial power trades, if the inter-connection grid becomes a reality later this year. Construction of the plant began in May, when the founding stone was laid.

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