Managing Qatar's growth ambitions

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Some major construction contracts in the emirate are expected to be awarded this year.

Some major construction contracts in the emirate are expected to be awarded this year.

When the qatar government announced a project-management training course for some of its officials last month, it was frank about why the course was urgently needed.

“The National Development Strategy 2011-2016 calls for individuals and teams within government to work in ways that may be new to them,” the General Secretariat for Development Planning said in a statement.

The course will introduce participants to key management concepts such as time, cost, quality and results, and teach them how to handle changes to projects after they have been launched.

Qatar’s huge infrastructure build-up to the World Cup will see the government spending about $140bn through 2022, promising to transform the tiny, gas-rich country.

This has had international contractors, consultants and suppliers flocking to Qatar in the hope of securing lucrative construction and equipment contracts.

However, Qatar is discovering that its vast wealth alone is not enough to push forward its 2022 World Cup build-up. To avoid waste and confusion, the country of just 1.9 million people will need to develop or hire management expertise on a scale that would challenge much bigger nations.

For the next decade, much of the capital Doha will resemble a giant construction site, putting pressure on the small non-energy economy, the arid environment and the social fabric — some religiously-conservative Qataris are apprehensive about the influx of foreign workers who will build the projects.

Due to these obstacles, foreign companies bidding for the projects are already discovering that the business opportunities are not necessarily as attractive as they seem.

“Delays and inadequate execution of the investment programme entail significant reputational risk for Qatar,” says Rupert Booth, senior economist at construction design consultant Atkins in Doha.

Qatar’s construction plans include a $36bn rail system, a new airport that will cost $17.5bn, a $7.4bn seaport, hundreds of kilometres of major new roads and an overall urban makeover.

Many of the projects will prepare the country to host the 2022 World Cup soccer tournament, which the government hopes will seal Qatar’s arrival as a top global travel destination.

“I do not think there has been as comparatively ambitious an infrastructure roll-out in such a small place, in such a short period of time,” says one Doha-based economist at a financial institution, declining to be named under briefing rules. “There is just no precedent for this.”

Since Qatar is one of the world’s richest countries, money does not look likely to be a problem. Over the past three fiscal years alone, the government’s budget surplus has totalled over $33bn; other sources of financing will include foreign and domestic borrowing, the retained earnings of state-owned companies and private sector investment.

However, completing projects on time may be a problem. Two years after Qatar won the right to host the World Cup, little work on many of the mega projects has actually started, disappointing some businessmen who flocked to the country to seek contracts.

“We are all expecting a tsunami of work to come in. But we expected it to start last year,” one Doha-based construction consultant says, declining to be named due to the political sensitivity of his remarks.

Design changes have already led to delays in building the new airport, which is to accommodate 50 million passengers a year and boast onyx countertops, sunken gardens, a mosque complex, squash courts and a swimming pool. The project is now estimated to cost $3bn more than originally anticipated.

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