Qatar's $100bn World Cup spree faces tight deadline

Emirate faces tight deadlines to whip infrastructure into shape ahead of 2022 crowds, says report
Qatar's $100bn World Cup spree faces tight deadline
QATAR PLANS: Doha had already announced plans to splash $100bn- or 87 percent of GDP – on sprucing up its infrastructure before being chosen to host the world’s biggest sporting event (Getty Images)
By Joanne Bladd
Wed 22 Dec 2010 08:49 AM

Qatar’s $100bn spending spree ahead of the World Cup is set
to force a string of legacy infrastructure projects to the top of the agenda,
an economic report has said.

Gas-rich Doha must scramble to complete multibillion-dollar
projects including the much-delayed $4bn Qatar-Bahrain Causeway, and its $25bn
metro and rail scheme – originally slated for completion in 2025 – said
National Bank of Kuwait (NBK) in a report.

“Hosting the World Cup foremost adds a sense of urgency and
an ultimate hard deadline for the completion of the projects critical to a
successful hosting,” the report said.

Doha had already announced plans to splash $100bn- or 87
percent of GDP – on sprucing up its infrastructure before being chosen to host
the world’s biggest sporting event.

Projects in the pipeline include a $7bn deep water port, the
$10bn Doha International Airport and a $20bn upgrade to the emirate’s road
system.

For the World Cup alone, Qatar has pledged to build 12
state-of-the-art stadiums at a cost of $2bn each, and to add 90,000 new hotel
rooms – despite FIFA only requiring the addition of 65,000.

"Hosting the World Cup will set tight deadlines, create
extra spending, bring in new expertise and present additional motivation and
incentives," the report said.

The massive investment will spur on Qatar’s economy at a
time when its hydrocarbon-driven growth was set to end, NBK said, with the
Gulf’s banking sector poised to be one of the chief beneficiaries.

“Sustained fee plans will help banks generate revenues
through balance sheet growth and increased fee generating businesses. The plan
could result in deeper stock markets with some companies set to go public for
their funding.”

Some Gulf firms are likely to establish joint ventures to meet extra demand
created by Qatar's World Cup preparations, bolstering intra-regional trade and
aiding scores of contractors. 

Qatar, however is at risk of building excess supply in
certain areas, mainly in hotel rooms.

“[But] the returns of hosting the event, tourism, TV rights,
should cover a good deal of the additional expenses,” NBK said.

 

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