Font Size

- Aa +

Tue 9 Oct 2012 11:16 AM

Font Size

- Aa +

Qatar to relocate French SMEs as part of US$389m fund

Gulf state hopes to host smaller firms and create partnerships - ambassador

Qatar to relocate French SMEs as part of US$389m fund
French President Francois Hollande (L) shakes hands with the Emir of Qatar, Sheikh Hamad bin Khalifa Al-Thani. (AFP/Getty Images)

Qatar plans to relocate to the Gulf some of the French small and medium sized companies it will invest in as part of the 300 million euro (US$389m) fund it set up with the Paris government last month, the Qatari ambassador to France was quoted as saying on Monday.

France's Socialist government announced in September it will let gas-rich Qatar invest up to 300 million euro (US$389m) supporting small and medium sized enterprises in France.

In an interview with the US-based Al-Monitor news outlet, Qatar's ambassador to France, Mohamed Al Kuwari, said some of the French firms would relocate to Qatar as part of the plan.

“Yes, this is our strategy, we want to create partnerships. It [is] will be in the contracts we issue. We want some of these companies to work with us in Qatar,” Al Kuwari was quoted as saying.

Al Kuwari also confirmed the size of the fund and how it would be managed. “We are probably talking about 200 to 300 million euros, half of it from Qatar and half of it from the French government and possibly from the [French] private sector… The French government will propose the projects and then we will choose. We won’t choose the areas. It can be anywhere: in the suburbs, cities, towns, villages or mountains,” he said.

Business ties between France and Qatar have deepened in the past five years as the eurozone's second-biggest economy has overcome appeals towards economic patriotism, welcoming investment in areas from sports to real estate and infrastructure.

There was little backlash when Qatar bought minority stakes in infrastructure firm Veolia and builder Vinci, while sports fans cheered the purchase of football club Paris St. Germain by its sovereign wealth fund last year.

The suburban funds are to be aimed at providing financing for first-time entrepreneurs looking to set up businesses.

The loudest criticism to the idea has come from far-right leader Marine Le Pen, who said Qatar was only investing in immigrant-heavy suburbs to spread Islamic ideas among Muslim youths.

"They are investing massively in the suburbs because of the large proportion of Muslims who live there," Le Pen told RTL radio. "It's suspicious because we're letting a foreign country cherry-pick its investments based on the religion of this or that segment of the population."

For all the latest banking and finance 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.