The summer’s over, and congestion has returned to the streets of Doha. It’s the sign of a city that is growing at breakneck speed, and no-one can fail to miss the abundant works that are now taking place all over town.
The traffic chaos hides some underlying problems that are evident as Qatar builds its way towards the World Cup in 2022. But the difficulty with a candid discussion about what’s going on with the contracting industry is that no-one wants to talk on the record, for fear of losing out on any future work in Qatar. That’s why last week’s decision by the Lindner Depa joint venture to file an arbitration claim against the management behind the new airport is so critical; it signals that firms are finally becoming more open about the problems they are facing.
One company I spoke to recently said that their plans were being hampered by red-tape restrictions that dictated exactly which country their staff should come from. Bizarrely, that even extended to requiring a specific number of engineers from a specific North African country in which the contractor didn’t have a recruiting base. When I asked how the firm could afford to do that given the tight margins on the contract, he simply replied that the extra sum would have to be priced into the next bid. In effect, it will eventually add up to more cost for the client, for no reason.
Another firm said that despite offering a 20 percent salary increase to potential candidates, it was proving almost impossible to convince staff to up sticks and move to Doha. Much of that is apparently due to quality of life issues and the standard of education, but it’s also down to the kafala (sponsorship) system, which requires expat employees to get permission from their bosses before they leave the country. The only other country which implements this rule for non-nationals is Saudi Arabia.
So who stands to benefit from all this? Well, it looks like the airlines are making a mint, at least. At present, Flydubai is operating eight flights a day to Doha, while Emirates is offering six.
Qatar Airways is now flying a whopping 13 times a day to Dubai, a total of 91 flights a week. With Emirates and Qatar Airways both charging around AED1,000 ($272) per return journey for a 45-minute flight, it’s certainly a nice little earner. There’s no data on who exactly is on those flights, but the assumption must be that the demand is due to workers choosing to base themselves in the UAE and commute, rather than cope with the restrictive visa regulations in Qatar.
And that level of traffic is only set to grow even higher; one unconfirmed rumour is that Emirates is already planning to offer upwards of 30 flights a day to Qatar at around the time of the World Cup. If the unified visa for the six GCC nations goes ahead — and reports are suggesting that this could come into place as early as next year — then that would enable fans to base themselves elsewhere in the Gulf, fly into Doha for a specific match, and then fly straight out again afterwards.
Right now, some contractors are also worried that the dithering over the announcement of new tenders is a signal that those in the higher echelons of Qatar’s leadership are concerned about whether the World Cup will take place in the country full stop. That is not in Qatar’s hands, of course, but clarity as to a timeline for development is crucial.
There has, as yet, been little in the way of arbitration of contractual disputes. The fear is that last week’s decision by the Depa Lindner JV will not be the last by an external contractor working in Qatar.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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