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Mon 16 May 2011 07:35 PM

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Qatar unlikely to reap World Cup 2022 riches - Citigroup

US bank's chief economist for Middle East says football event will not be 'net beneficial' for country

Qatar unlikely to reap World Cup 2022 riches - Citigroup
A model of the Al-Gharrafa stadium to be used in the 2022 World Cup in Qatar. (AFP/Getty Images)

Qatar, awarded the right to host
the 2022 soccer World Cup last year, won’t see an economic benefit from
hosting the event, Citigroup’s chief economist for the Middle East
said.

“You do risk
having hotel rooms sitting idle for a long time,” Farouk Soussa said at
a conference in Doha, Qatar, on Monday. “I would not say, from a
cost-benefit analysis, the World Cup is going to be net beneficial to
Qatar.”

Qatar will
need to increase the number of hotel rooms tenfold to reach the 90,000
pledged, he said. Existing hotel occupancy rates hover at about 60
percent in the emirate, he said.

The country, with a population of about
1.6 million people, will be the smallest to host the tournament since
Uruguay in 1930.

Qatar beat
the US, Australia, South Korea and Japan to win the 2022 World Cup at a
ceremony hosted in Zurich in December. The country will invest about
$88 billion in infrastructure for the World Cup, Qatar National Bank’s
Assistant General Manager and Head of Project Finance Enrico Grino said
today.

As part of
its bid, Qatar pledged to build nine new stadiums and refurbish three
others, each of which will utilise solar-powered cooling technology in a
country where summer temperatures rise as high as 50 degrees Celsius
(122 degrees Fahrenheit).

The
emirate’s bid also included building accommodation for visitors, rail
and metro links as well as a bridge to nearby Bahrain. 

The new stadiums
will be partly dismantled and shipped to developing countries when the
event is over to help mitigate the problem of unneeded infrastructures.

Most
economic benefits from expenditures for the World Cup won’t come until
after 2016, the state-run General Secretariat for Development Planning
said in a March 28 report.

Qatar, the
world’s biggest exporter of liquefied natural gas, projects its economy
to expand by 20 percent this year in nominal terms.

The country will
have the world’s fastest growing gross domestic, according to
International Monetary Fund projections.

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Colin Kirkcaldy 8 years ago

The social benefits, however, of having a public transport, Metro and rail system; better roads; superior infrastructure; a new port; new airport; new sporting fixtures and the myriad of other things the World Cup build up will bring will be tremendous. These things don't come without major investment.

Asif 8 years ago

An Investment in the range on $90bn, is it worth it, in a country which have very few nationals, and relies entirely of expatriates workforce. They do not have many people to reap benefits of such an investment in the long run.

Hotels their are struggling to fill 9000 rooms, I do not understand what they will do once the world cup is over.

Dismantling and shipping stadiums, just the thought of it, shows how absurb this idea is of holding a world cup here.

aquil 8 years ago

Unless there is a change in visa laws, it will be difficult to atract professionals & people to reside over there. The law is virtually makes expatraites a prisoner & has to depend on the sponsorer for his exit & entry to the country. Also once, you resign for better opportunity, you need to wait for 2years to enter again, This kind of visa policy does more bad than good for the economic growth. Now, being host for FIFA 2022, it needs to attract best professionals to meet the infrastructure demands, unless & untill visa lwas are relaxed, it will be difficult to realise its dream of meeting deadlines. On other hand the country totally depends on outside world for its materials, with nothing is manufactured except gas. This will give rise to high demand for the construction materials which will result in high cost of procurement resulting in final increase in project cost. But, beware, in case projects are won based on price war, poor contractors will lose thier money!!

Michael 8 years ago

I really dont think that Qatar is trying to bring anyone that think he is a professional, i dont think they want quantities, otherwise they can open up for few Asian counties and they will be 50 million in a year :-)

Qatar is trying to headhunt the good ones from all over the world, tuff mission but not impossible, specially when all the world eyes are on Qatar right now, and everyone is looking for his part of the cake, i think it will be an easier task.

Michale 8 years ago

Its funny how some still cant understand why Qatar is going for 2002. its even funnier that some still think that the State of Qatar is trying to benefit financially from hosting the tournament.

For these they cant still understand the game, or the bigger picture, or they refuse to even think about that...

From my 35 years of experience in Qatar i can say, the tournament will happen, it will be costly but it will be good, and everyone worldwide will talk about it.

Yet the money is a bonus but the position, the name, Brand development, the awareness, this is what Qatar is after and 90bn is a good money for that.

Got it? now stop weeping...

Dave 8 years ago

The tournament should be a success; as long as the security forces there realize they cant beat fans with tickets and make them go away. And also that being a citizen does not give someone the right to march through without tickets at the cost of other ticket holders, just because the ticket holders are expats.
Lets also hope they dont force Asian workers to go to stadia to make them appear as full, by threatening the workers with termination if they dont obey