The Qatar Central Bank has done and still does an exemplary job of managing finances in the country. domestic macroeconomic developments,

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1 WEDNESDAY, NOVEMBER See this report at A special supplement by PANORAMA REPORTS LTD Strong foundations for sustainable development The Qatari government is building on the nation s strengths, turning Doha into a leading global knowledge and financial centre Ranked consistently as one of the three fastest-growing economies in the world since 2008, Qatar is experiencing an unprecedented economic boom that is changing the face of the country. Under the leadership of Emir Sheikh Hamad bin Khalifa Al Thani, the government has made great progress towards accomplishing the goals of its National Vision 2030, which are to ensure sustainable, equitable and rapid economic growth, while developing the country s human capital, enhancing competitiveness and protecting the environment. In a speech to the International Symposium held in Doha in June 2012, Prime Minister Hamad Bin Jassim Bin Jabr Al Thani emphasised the important role of the Qatari leadership in transforming the country into one of the most competitive and diversified economies in the world. Qatar, he said, has earned worldwide admiration and praise from international economic and development circles for its outstanding success in achieving a qualitative economic, social and cultural transformation in less than two decades, a feat which took several decades to achieve in other countries. Indeed, in less than two decades the Persian Gulf nation of less than two million has become the second wealthiest country in the world measured by GDP per capita. The country s double-digit GDP growth in recent years has been accompanied by good governance and competitiveness. Proof of that is the fact that the World Economic Forum ranks Qatar as the most competitive country in the Middle East and the 14th most competitive in the world; the World Bank ranks it as the third country in the Middle East and 36th worldwide for ease of doing business; and Transparency International as the 22nd most transparent country in the world, higher than many OECD countries. The oil and gas sector remains the stronghold of the economy and an important contributor to the state budget, which is not surprising seeing how Qatar has significant oil reserves of Chancellor Angela Merkel with Qatari Prime Minister Sheikh Hamad bin Jassim bin Jabr Al Thani 25.4 billion barrels, according to the Oil and Gas Journal. The country is also home to the third largest reserves of natural gas in the world and is the number one exporter of liquefied natural gas (LNG) worldwide. The sector has grown exponentially in the last decade as a result of the government s efforts to develop the infrastructure needed to export LNG to far-away places like Japan and Belgium, and to increase the added value of energy exports by promoting downstream sectors, particularly the production of petrochemical products. But energy only tells part of the story, as the contribution of the fast-growing services sector to the economy is expected to reach 40 percent by This trend illustrates the government s ambition to turn Qatar into a knowledge and finance hub in the Middle East and a centre for Islamic culture. Since 2003, when the country s Education City was founded, prestigious international universities like Carnegie Mellon, Georgetown University and University College London (UCL) have opened up branches in Qatar. These programmes are held to the same standards as their counterparts in Western Europe and North America, but are also in line with Qatar s developmental needs and strategic interests. Meanwhile, the Science and Technology Park, located across from Education City in Doha, hosts R&D operations of some of the largest multinationals in the world, including ExxonMobil, Maersk Oil, Total, Shell, Microsoft, CISCO, Siemens, Virgin s stem cells research centre and Rolls Royce. But perhaps the most important growth catalyst in the coming years will be Qatar s hosting of the 2022 FIFA World Cup tournament, for which the government has delegated to the Qatar 2022 Supreme Committee the responsibility of supervising preparations. The committee has a budget of over $100 billion to be spent over the next ten years on infrastructure, and has already started works on futuristic-looking stadiums that encapsulate the spirit of the new Qatar: innovative, dynamic and globally-engaged. Qatar seeks more IMF cooperation in region Finance Minister urges more flexibility towards needs of Arab nations Finance Minister Sheikh Yousef Hussain Kamal has called upon the IMF and the World Bank to take a business unusual approach towards the Arab nations and respond to their needs with greater flexibility and speed. Speaking at the annual meeting of the International Monetary Fund and World Bank held in Tokyo in October, the Finance Minister said the IMF should review its quota system, widen the availability of its global knowledge base and do more to develop the private sector across the Arab world. The Minister, who spoke on behalf of his Arab colleagues, urged the two institutions to take a business unusual approach and be ready to go the extra mile at short notice and in demonstrating more flexibility with regards to the conditions placed on the Arab countries by the IMF. Specifically, the Minister said the IMF should review its system of quotas, which he said lacks fairness. He also addressed the issue of global knowledge the enormous amount of data, studies and other resources contained in the IMF and World Bank. He said these must be made available in real time, in Arabic, and should be produced in collaboration with local country policymakers and think tanks. Finally, Sheikh Yousef Hussain Kanmal urged the two institutions to improve their efforts to develop the private sector across the Arab world. We see the private sector as the main driver for future growth and the key to realising the region s potential for robust and sustained job creation, technological innovation and regional economic integration that are urgently needed, he said. On broader issues, the Qatari finance minister said the IMF should increase its financial support for the Palestinian Authority, to help it in building a viable economy, and increase the representation of Arab nationals both at the Fund and at the World Bank. Sheikh Yousef Hussain Kamal, Minister of Finance Governing Qatar s monetary policies The Qatar Central Bank has done and still does an exemplary job of managing finances in the country Founded in 1973 and originally known as the Qatar Monetary Agency, the Qatar Central Bank (QCB) oversees the country s financial fortunes. Many factors have contributed to building the monetary safe haven that the State of Qatar is today. One of the most important has been the link between the Qatari Riyal and the US dollar. Sheikh Abdulla Saud Al Thani, Governor of the QCB, believes this attachment to the dollar has had a profound effect on creating the solid platform on which Qatar s economy stands today. There are several advantages in maintaining the USD peg; first of all, the fixed exchange rate provides a credible anchor for monetary policy as almost all of Qatar s export contracts and invoicing are done in the US dollar. Secondly, for most of the period in which the peg has been maintained, the Qatari economy has benefited from the stable economic environment in the US, says the central bank governor. Since 2001, QCB has maintained a policy of keeping the Qatari Riyal pegged to the US dollar, at an average exchange rate of 3.64 (QR) per USD. However, this is not the only action taken by the central bank, which is constantly studying new ways to fortify and stabilise Qatar s economy. Despite obvious benefits there are some challenges while operating under fixed exchange rates, as We continue to reiterate our faith in the pegged exchange rate regime [with the USD] after carefully weighing the benefits against the costs. Sheikh Abdulla Saud Al Thani, Governor of the Qatar Central Bank we have to maintain our stance of policy consistent with that of the US, which may not always be justified based on our own domestic considerations. We continue to reiterate our faith in the pegged exchange rate regime after carefully weighing the benefits against the costs. Nevertheless, we will continue to review the situation according to evolving international and domestic macroeconomic developments, he adds. Unlike many countries whose economies rely heavily on exports of natural resources, Qatar has been able to withstand market fluctuations in the prices for those products. The government s national development strategy includes support for the expansion of non-hydrocarbon industries, so that in the case of a slowdown in the oil and gas sector, the economy will not be unduly affected. Right now, both areas of the economy are doing well so much so that the central bank has even lowered interest rates to make credit more easily available to companies in the private sector. The non-hydrocarbon sector also recorded higher growth, indicating resurgence in economic activity during the year in sync with the pickup in global growth. In order to support and sustain the growth momentum in 2011, we have recently reduced our key policy rate by 50 basis points to signal a soft interest rate regime and encourage the flow of credit to the private sector, says Sheikh Abdulla Saud Al Thani. The government s long-term vision is a cautious and careful one, which seeks to preserve financial stability through a two-pronged approach. To date, this strategy has been highly successful. The first aspect of the policy is to prevent the financial system from exposure to unnecessarily high levels of risk. To this end, the QCB has taken preventive measures to regulate and supervise the system, so that any weaknesses can be detected early on. Even with extensive supervision, however, no financial system can be completely protected from all types of risk. For this reason, the second axis of the policy is corrective, as it seeks to contain any problems at the earliest possible moment and in so doing, prevent them from spreading. The central bank has also taken preventive steps to limit the banking sector s exposure in real estate and in stocks. Rising prices in both these areas during the past two years have increased speculative investment. As a result, restrictions have been placed on loans in the real estate sector and financing of stock purchases has been prohibited. With measures like these, the Qatar Central Bank seeks to maintain equilibrium between the country s development goals and its need to maintain a stable financial system. In order for investors to make long-term commitments in productive sectors, they require economic stability. Even so, all countries eventually find themselves exposed to crises, long- or short-term fluctuations in export prices or even situations of extreme financial distress that can adversely affect economic activity. Stability is the watchword for the Qatar Central Bank and the proof is in the results of its policies. QCB keeps a close watch on all potential dangers to the country s banking system; to date, it has published three Financial Stability Reviews and the intention is to make this a continuing process.

2 2 WEDNESDAY, NOVEMBER Positioning Qatar as a regional financial centre Already acknowledged as the best bourse in the MENA region, Qatar Exchange has a new CEO to take it towards its goal Celebrating its 15th year, the Qatar Exchange was the best performing stock exchange in the MENA region in 2010 and 2011 PANORAMA REPORTS LTD The Old Fire Station 140 Tabernacle Street London EC2A 4SD Tel: +44 (0) panorama@panoramareports-ltd.com, PROJECT DIRECTOR: Nathalie Martin-Bea Just a couple of weeks after his appointment as CEO of Qatar Exchange, Rashid bin Ali Al Mansoori, found himself at Doha s St Regis Hotel collecting Global Investor s highly prestigious Middle East Exchange of the Year award. It s the second time Qatar Exchange (QE) has walked off with the title, which it also won in 2010, after being picked by investors as the best stock exchange in the Middle East and North Africa (MENA) region. The award highlighted QE s role as a significant player in the regional exchange space and the efforts it has made to enhance the quality and depth of Qatar s capital market, as well as support local companies. In the longer term, however, the Qatar Exchange is part of a wider vision of creating a world-class financial centre around a global exchange, in the same league as the leading capital markets in Europe, the US, and Asia. To this end, the exchange has launched a series of initiatives. It has successfully implemented the delivery-versus-payment system to enhance the efficiency of the settlement process, opened up the market to allow banks to re-enter as brokers, and introduced direct payment of dividends into the bank accounts of investors. Other developments include listing short-term Treasury Bills to attract the attention of banks and financial institutions as well as investors, and preparations to launch government, and eventually corporate, bonds. Securities lending and borrowing, along with liquidity provision schemes, have also been introduced. Earlier this year, the exchange launched its ambitious Venture Market, a separate junior bourse for small and medium-sized enterprises (SMEs), whose growth is vitally important to Qatar s development of a diversified national economy. The choice of Al Mansoori as QE s new CEO fits with the general policy of appointing highly qualified Qataris to leading positions in government and semi government institutions. He brings considerable administrative and technical experience to the role, and for the previous 18 months served as QE s deputy CEO. QE was established in 2009 as a successor to the Doha Securities Market. It is jointly owned by Qatar Holding, the strategic and direct investment arm of Qatar Investment Authority, and the New York Stock Exchange operator, NYSE Euronext, whose 20 percent stake at $200 million represented the largest investment it had ever made in a foreign exchange. QE benefits from NYSE Euronext s renowned trading systems and technology. It is the first exchange outside the NYSE Euronext family of exchanges to utilize the Universal Trading Platform (UTP), now used by every NYSE Euronext market around the world. The intention to transform QE into an internationally recognized exchange has been there from the start. Qatar is expected to be the second-largest economy among the GCC countries by 2015, making it an ideal location for a major capital market in one of the world s fastest-growing regions. It is this potential that has drawn in NYSE Euronext, which is committed to use Doha as its Middle East operational and support hub. QE currently has 41 listed companies, with banks and insurance companies featuring prominently, and the real estate, consumer goods and services, and transport sectors also represented. For the three quarters up to September 30, 2012, the combined net profit of all the companies with the exception of Vodafone Qatar, whose financial At year end 2011, the Qatar Exchange had a market capitalisation of over QR457 billion (EUR 97.4 billion) year starts in April amounted to $7.82 billion, an increase of 1.8 percent over the corresponding period in QE has also collaborated in developing a legislative framework to give investors a variety of tools, including exchange-traded funds and real estate investment trusts, while promoting transparency in the market. Listed companies from neighbouring GCC countries are showing an interest. QE has already begun talks with a number of GCClisted companies who are actively working towards listing here in Qatar. Experts suggest there might soon be a renewed effort towards initial public offerings (IPOs) in Qatar. Barwa Bank is among the major Qatari companies that have publicly discussed a listing on QE. Talks have also been taking place with some of the key businesses in the SME sector about listing on the new Venture Market. QE s management emphasises the importance of enhancing liquidity in the market, and the exchange is already working with the regulator to address concerns about the need for greater liquidity provision. QE is ready for securities lending and borrowing to attract more foreign investments, and applications have been made by three entities to act as liquidity providers. Onshore banking with offshore benefits The Qatar Financial Centre Authority promotes the expansion of the country s financial services sector The world s most famous financial centres are well established: London, New York, Frankfurt, Singapore. Many countries are actively promoting the formation of their own financial centres, and few have been more successful than Qatar in such a short time, which passed the law setting up the Qatar Financial Centre (QFC) in Since then, the Qatari government and the QFC have invested heavily in providing financial services companies with the most modern legal, financial and physical infrastructure possible, permitting companies to move into the region to establish themselves quickly and smoothly. The QFC is comprised of three main parts: the QFC Authority, which is the commercial arm of the centre; an independent financial regulator, known as the QFC Regulatory Authority; and an independent judiciary made up of a Civil and Commercial Court and a Regulatory Tribunal. The combination of physical, legal and regulatory structures set up by the QFC provides financial institutions with the vital environment they need to establish operations profitably in the Gulf Cooperation Council (GCC) region, which boasts one of the world s fastest-growing economies and will be the destination for billions of dollars of investment in coming years. Those in the financial services industry like to be in close proximity to each other, but need a proper environment to thrive, says Shashank Srivastava, Chief Executive Officer of the QFC Authority. I believe we have created the right legal and regulatory environment that allows the companies to not only access the domestic market with their international companies but also the regional international markets. Shashank Srivastava, CEO and Board Member of the Qatar Financial Centre Authority The QFC provides companies with an onshore trading environment with a strong legal sector based on English common law, a principles-based regulatory structure and a low tax of 10 percent on locally sourced profit. Profits can be freely remitted outside the country and the law allows 100 percent foreign ownership by foreign companies and places no restrictions on dealing in any currency. Qatar has double-taxation agreements with more than 35 countries, providing still more benefits for companies, and their employees, that relocate to the country. Employees can also enjoy a high quality of living, with top-notch, reasonably-priced housing, affordable healthcare and many international schools. This highly desirable offer has already attracted many well-known international financial institutions, with more than 165 licenses issued since 2005 to both local firms and companies from abroad. The list includes Allianz, AXA, Barclays Capital, Citibank, Credit Suisse, Deutsche Bank, ICBC, JP Morgan, Kane, KPMG, Marsh, Mitsui Sumitomo, Morgan Stanley, Pricewaterhouse- Coopers, UBS and Zurich FS. The QFC Authority has been so successful at setting up and promoting the financial centre that it has won the Best Financial Centre in the Middle East award from Global Investor magazine, the flagship publication of the prestigious Euromoney group, in 2011 and in We are extremely proud to be recognised as the best financial centre in the Middle East by such a highly regarded industry publication, says Mr Srivastava. Winning this award for a second year in succession is welcome recognition of the progress we are continuing to make in building a world class financial centre and the leading platform to capitalise on the emerging opportunities in the Middle East. The QFC is also busily planning for the future. Financial centres need well established legal and regulatory frameworks to function, but they also need a large pool of talent, and the centre has already taken important steps towards providing such a group of well educated people. The Qatar Finance and Business Academy (QFBA) was started in partnership between the QFCA and the Qatar Foundation for Education, Science and Community Development. The QFBA arranges for students to go on courses which are certified by third parties (such as the Chartered Institute of Bankers).

3 WEDNESDAY, NOVEMBER QIB: the benchmark Islamic bank in Qatar Its anniversary year finds Qatar Islamic Bank renewed and ready to exploit opportunities for growth in Qatar and beyond A financial bridge between the region and the world Ambitious plans for growth in the region and beyond have always been part of the plan for Masraf AI Rayan The bank continues to show significant growth, stable and well diversified revenue streams, and positive results. Sheik Jassim Bin Hamad Bin Jassim Bin Jaber Al Thani, Chairman of QIB While the rapid expansion of Islamic finance is a relatively recent phenomenon, Qatar Islamic Bank, the Gulf Arab state s largest Shariah-compliant lender by assets, this year marks its 30th anniversary. Established in 1982, QIB has long been at the forefront of the Islamic banking industry, extending its activities from Qatar and the Gulf to the Middle East, Asia, Europe, and North Africa. The bank defines itself as the benchmark Islamic bank in Qatar, and experts agree. Global Finance this year named it Best Islamic Financial Institution in Qatar, recognising the bank s contribution to the growth of Islamic banking both locally and internationally, while The Asset magazine awarded it Best Bank in Qatar. Last year it was named Best Islamic Bank in Qatar for 2011 at the Islamic Finance News (IFN) awards. Despite the plaudits, QIB s anniversary year does not find the bank resting on its laurels. Indeed, recently it has been undertaking a transformation programme in order to take full advantage of the promising growth opportunities in Qatar and beyond. With paid-up capital of QR2,360 million ($648 million), and a well-distributed network of 30 branches, QIB holds a 36 percent share of the Islamic banking market in Qatar, and an approximate market share of 10 percent. Along with offering a wide range of products and services for individuals, the bank is active in financing for businesses of all sizes, from major corporations to small and medium-sized enterprises, and micro enterprises, as well as participating in joint financing projects with other financial institutions. One of the largest initiatives of national importance to which it has contributed is the Barzan Gas project, being implemented as a joint venture between Qatar Petroleum and ExxonMobil Qatar. QIB provided $500 million to finance the project, which is the biggest portion of the total Islamic tranche of $850 million. More recently, in August, QIB signed a $380 million package for the Qatar Gas Transport Company (Nakilat) in partnership with Qatar International Islamic Bank (QIIB). QIB has also extended a $500 million Islamic financing package to Qtel. The bank s sound financial position and business strategy is reflected in its rating from international ratings agencies. In August, Fitch Ratings affirmed QIB s long-term issuer default rating at A with a stable outlook, and viability rating at bbb. Standard & Poor s, rating the bank for the first time, recently assigned its A- long-term and A-2 short-term counterparty credit ratings to QIB with a stable outlook rating on the long-term. S&P hailed QIB s leading position in the Qatari Islamic banking segment, and its business model and management. Financial results for the nine months ended 30 September 2012 show QIB realised a net profit of QR1.13 billion ($310 million), a rise of 2 percent compared to same period last year. The bank s total assets increased by 26.7 percent to stand at QR 66.8 billion ($18.3 billion), while customer deposits show 50 percent growth at QR39.9 billion ($10.9 billion). Sheikh Jassim Bin Hamad Bin Jassim Bin Jaber Al Thani, QIB s Chairman, says, The bank continues to show significant growth, stable and well diversified revenue streams, and positive results. QIB has also recently been celebrating the hugely successful first tranche of its new $1.5 billion Islamic bonds (sukuk) programme, a $750 million 5-year sukuk priced at a profit rate of 2.5 percent the lowest profit rate ever achieved by any GCC financial institution. Marking QIB s return to global debt markets after two years, the sukuk aroused enormous interest from international as well as regional investors, with strong participation from Asia and the MENA region, and also from Europe. With the final book reaching $6 billion, the issue was 8 times oversubscribed in a year when there has been no shortage of Middle East sukuk issues. Sheikh Jassim says the sukuk programme will enable the bank to further contribute to Qatar s economic growth both at home and internationally. Masraf Al Rayan, one of Qatar s largest banks, set itself the goal of becoming an international Islamic finance institution right from when it was established seven years ago. Because of what was going on in the whole region in terms of growth, and particularly in Qatar, we needed a mega-sized bank to cater to Islamic and non-islamic customers, says Adel Mustafawi, the bank s Group CEO. From the very beginning, our strategy was to start from Qatar, then expand to the GCC, other countries in the Middle East & UK, building the real economy through the financial sector. Today, Masraf Al Rayan has become one of Qatar s largest Islamic banks, with a market share by assets estimated at 10 percent at year-end It was the first bank in Qatar to have shareholders from Saudi Arabia, Kuwait, Bahrain, UAE and Oman, in addition to its domestic base of shareholders. The Doha-based lender makes no secret of its interest in making acquisitions in other GCC countries and beyond. Currently, it is working on a plan to enter the UK market by acquiring a 70 percent holding in Islamic Bank of Britain (IBB), in a deal in which the Government of Qatar would secure the remainder of the shares. This would be the bank s first advance beyond the GCC, giving it a foothold in the European market. While Mustafawi insists Masraf Al Rayan won t be rushing into Europe, it could be an attractive prospect for the bank in the longer term, given the potential for Islamic banking in countries like Germany and France. In the meantime, he has noticed an increasing number of international investors Our strategy is to link the real economy with the financial sector. We are going to expand into other sectors. Adel Mustafawi, Group CEO of Masraf Al Rayan taking an interest in ethical Islamic financial institutions. International investors are becoming increasingly aware of Islamic products, he observes. They see it as an ethical, less risky kind of banking that serves to benefit both the client and the financial institution. Masraf Al Rayan s results for the first nine months of the year show net profit up 7 percent to QR1.08 billion ($ million) compared to the same period in Financing activities increased nearly 32 percent to QR37.86 billion, while customer deposits rose more than 29 percent to QR51.72 billion, from QR40 billion. Offering a full range of retail, corporate, private banking and investment banking services, the bank has been creative and innovative in terms of its products. We compete with conventional banks in terms of the type of products that we offer, says Mustafawi. It is extending its nationwide branch network and, in the wake of Qatar s conventional banks being ordered to cease offering Islamic banking services, has launched a brokerage arm, Al Rayan Financial Brokerage Company. Moody s Investors Service says Masraf Al Rayan is well placed to benefit from the strong economic growth in Qatar. Recently upgrading the bank s credit rating to A2 Prime-1 from A3 Prime-2, it cited the quality of its assets, a growing domestic franchise in the corporate market in Qatar, and strong financial fundamentals, in comparison with its peers. Mustafawi says Masraf Al Rayan will be one of the fastest-growing financial institutions in the region, extending its activities across the Qatari economy. Our strategy is to link the real economy with the financial sector, he says. We are going to expand into other sectors. Today, we are into oil and gas services we have a joint venture with an international company. We are also involved in a real estate development with another international company. We have a facilities management company, an insurance company and an industrial company. DIFFERENCES BETWEEN ISLAMIC AND CONVENTIONAL BANKING CHARACTERISTICS Business framework Balance between moral and material requirement Equity financing with risk to capital Prohibition of Gharar Profit and loss sharing ISLAMIC BANKING SYSTEM Based on Shari a laws. Shari a scholars ensure adherence to Islamic laws and provide guidance. The requirement to finance physical assets through bank ownership prior to resale reduces overextension of credit. Available to provide equity capital to a project or venture. Losses are shared on the basis of equity participation while profits are shared on a pre-agreed ratio. Transactions deemed Gharar are prohibited. Gharar denotes varying degrees of deception pertaining to the price and quality of goods received by a party at the expense of the other. Returns are dependent on bank perfomance and not guaranteed. Risks are managed to ensure better returns than deposit accounts. The profit upside is more equitable than predetermined returns. CONVENTIONAL BANKING SYSTEM (INTEREST-BASED SYSTEM) Not based on religious laws or guidelines only secular banking laws. Excessive use of credit and debt financing can lead to financial problems. Not generally available through commercial banks. Venture capital companies and investment banks typically take control of an enterprise for start-up finance. Trading and dealing in derivatives of various forms is allowed. This principle is not applied. Returns to depositors do not depend on the bank s performance. The customer does not share profit beyond predeterminated interest rates. Source: Abu Dhabi Investment Bank Barwa Bank, the fastest growing bank in Qatar 2012 Awards for Qatar s newest Islamic lender as it builds on a remarkably successful entry into the market The decision by the Central Bank of Qatar ordering conventional banks out of the Islamic finance market has helped Qatar s newest Shariah-compliant lender become the Gulf state s fastest growing bank. Barwa Bank was among the first to benefit from the QCB s surprise ruling last year, instructing conventional banks to close their Islamic windows. In what was later deemed Qatar Deal of the Year by Islamic Finance News, the bank simultaneously boosted its customer base and expanded its network from one branch to six by acquiring International Bank of Qatar s Al Yusr Islamic retail banking operations in August last year. In June this year, it won the award for Fastest Growing Bank in Qatar at the Banker Middle East Industry Awards, and in September was named Fastest Growing Company at the Arabian Business Qatar Awards. We have seen a reduction in competition in a market that is growing faster than conventional banking, says CEO Steve Troop. It is a great place to be, and we intend to realise the opportunities as much as we can. With authorised capital of QR6 billion ($1.6 billion), and total equity of QR5.1 billion ($1.4 billion), Barwa Bank offers a full range of financing services in retail, business, corporate and private banking. The velocity of the bank s rise is reflected in its financial results for 2011, which recorded a 882 per cent rise in net profit to QR244 million ($67 million), compared with QR25 million ($6.86 million) in When the bank launched a QR1.7 million ($467 million) rights issue last year to fund expansion, its offer of million new shares to existing shareholders was oversubscribed by 13 percent. Steve Troop, CEO of Barwa Bank Barwa Bank is an associate company of Barwa Real Estate, the Middle East s biggest property company by assets, which is its most significant shareholder. It also has an indirect relationship with Qatari Diar, the real estate arm of the Qatar Investment Authority, through its other prominent shareholder, Qatar Holding, the sovereign wealth fund s investment subsidiary. These are important connections for the bank. We are committed corporate bankers, so we are involved very much in lending to large corporations and businesses here in Qatar, says Mr Troop. Barwa Bank s investment banking arm, The First Investor (TFI), raised financing for the $700 million CityCenterDC development in Washington DC, one of the largest urban rejuvenation projects in the United States, for which Qatari Diar is the anchor investor. TFI has also started a property fund in Brazil as a joint initiative with the US-based Hines International Real Estate Holdings. At home, Barwa Bank participates in Qatar s economic development, including working with Hochtief, the German construction company, based in Essen. Much of the activity is associated with major infrastructure projects, but not exclusively, says Mr Troop. The bank has also developed a strong focus on assisting small and medium-sized enterprises (SMEs), and was one of the first to sign up to Qatar Development Bank s Al Dhameen scheme for start-ups, an indirect lending facility to guarantee commercial bank loans to the private sector. Mr Troop says that at present Barwa Bank is essentially a domestic institution, but its long-term ambitions will eventually see it establishing offices beyond Qatar s national boundaries. We have lots to do before we think about expanding internationally. I would stress, however, that we are ambitious and wish to grow. We can only go so far in this market, and inevitably we will go international, he says. Meanwhile, since establishing its Islamic Capital Markets platform earlier this year, the bank has emerged as a key player in the growing market for Shariah-compliant bonds, known as sukuks. In September, it was appointed co-lead manager for the Republic of Turkey s first sukuk, a $1.5 billion issue, following its involvement in high-profile sukuks for the Government of Dubai, the State of Qatar, Saudi-based Islamic Development Bank, and real estate developer Emaar Properties. Bloomberg Islamic Finance league tables rank Barwa Bank among the top 10 arrangers for international, global and MENA region sukuk issues.

4 4 wednesday, november Ahli Bank and the results of excellence Since 1983, Ahlibank has served its clients through a full array of products and services within major business segments Solidity and growth at the national bank Qatar National Bank is on its way to becoming an icon in the Middle Eastern financial sector It may not be the biggest, but in only 30 years, Ahli Bank QSC has become one of the key firms in the financial sector in Qatar. The bank was founded in 1983 with the purpose of providing banking services tailor-made for the needs of the country. Ahli Bank boasts a large integrated network of 17 branches in Qatar offering a host of products and services from corporate banking, treasury and investments and retail to private banking and wealth management. The bank is listed in the Qatar Stock Exchange, with a market capitalisation of nearly QR 6.2 billion or EUR 1.34 billion as at November, From the origin of the bank, it was clear that Ahli Bank was born with a strong focus on the corporate and financial segments. Qatar has experienced an economic boom supported by the oil and gas industry. The country needed the help of the financial sector to get funds for developing major infrastructure projects. Some analysts expect that Qatar will still see strong lending growth in the next decade, so the future of the business of Ahli Bank at home is guaranteed. According to SICO Research, a division of the Bahrain-based regional investment bank, Securities & Investment Company (SICO), Qatar has indicated that it will be undertaking major infrastructure projects worth QR820 billion or EUR 177 billion over the next five years. This should lead to strong credit demand growth, in the area of 18 to 20 percent compound annual growth rate (CAGR) during , the report said. But Ahli Bank also has a growing retail customer business. Last year, the bank reported net profit of QR 442 million or EUR 95 million, the highest in the company s history. Ahli Bank s profits are still growing: during the first nine months of 2012 net profit grew 5 percent from the same period last year, to QR 367 million or EUR 79.2 million. Ahli Bank has been recently awarded the coveted Best Commercial Bank in Qatar by leading international finance magazine World Finance and by Arabian Business at the prestigious Arabian Business Qatar Awards. The awards comes in recognition of Ahli Bank s continuous commitment towards providing excellent services to its banking customers, and its vision to implement international best practices to ensure the Sheikh Faisal bin Abdul Aziz bin Jassem Al Thani, Chairman of Ahli Bank 2011 was a landmark year for Ahli Bank, as it posted a net profit of some EUR 95 million, the highest in the bank s history delivery of trusted commercial banking services. If we examine the financial data, these awards come as no surprise. It s worth noting, for example, the growth in total assets, to QR 19.7 billion or EUR 4.3 billion at the end of the last quarter, even after the Qatar Central Bank last year ordered conventional banks to close their Islamic Banking operations by the end of Ahli Bank is the fifth Qatari lender by assets. The growth of the business has been also healthy. Ahli Bank has a capital adequacy ratio of 22.1 percent NPL (Non Performing Loan). Coverage stood at 99 percent as of December 2011, something far from the numbers of the banking system in Europe. This performance was recognised by the international rating agencies when Fitch reaffirmed the bank s credit rating of A- with a stable outlook, only two notches lower than Deutsche Bank, for example. But even in Qatar, the financial system may face some handicaps. Experts expect some problems to access the funding. According to a recent research report by Citi, as Qatar proceeds with its expansionary strategy, the domestic banking system is facing growing challenges to support funding the country s ambitious growth strategy. Strong credit growth averaging more than 30 percent over the last 18 months, which has largely outpaced that of customer deposits (averaging 17 percent over the same period), resulted in a sharp rise in loan-to-deposits ratios (LDR), exceeding 120 percent at end- June 2012, said the analyst of the bank. But the executives of the banks expect a very encouraging performance for the bank and they think the business could benefit from the government s budget spending for the fiscal year In fact, they see many investment opportunities in the local market. If you haven t already heard of Qatar National Bank (QNB), you soon will, as the lender is quickly expanding its footprint in the Middle East and North Africa (MENA) region. And if it continues to grow at the current pace, QNB will soon become one of the biggest global banks. QNB was founded in 1964 with one clear objective: to help Qatar reach its potential. Fifty years later, it has become a global bank, offering retail, corporate and investment banking services. From the start, the lender has had a stable shareholder structure, with a 50 percent stake owned by the Qatar Investment Authority. Over a half century, the bank has climbed to first place in the Qatari stock market, with a market capitalisation of over $25 billion. At the beginning of 2012, the bank announced its new strategic plan for the next five years, which aims to make QNB Group a benchmark in Middle East and Africa. Already the largest financial institution in the MENA region with total assets of QR350 billion (EUR75.3 billion) in June 2012, QNB also has the largest international network of any bank in the region, covering countries in the MENA region, Europe (France, Switzerland and United Kingdom) and Asia. And on top of that, QNB has the largest market share in the domestic business. The bank s net profit is equal to nearly half the total profit of the 18 banks in the country and more than the half of their deposits, credit and loans. The bank s obsession with growth may have been derived from the need to diversify revenues in order to face the obstacles that may arise in Qatar. According to some experts, the Qatari banks margin spreads are expected to come under pressure during the second half of 2012 and through 2013, driven by asset spread contraction. A Citi report suggests margins are likely to contract by between 20 and 30 basis points in 2012, due to factors which include a lower demand for higher-yielding local currency loans, and a balance sheet shift towards lower-yielding public sector lending. On a systemic level, the report Ali Shareef Al-Emadi, CEO of Qatar National Bank notes, a move by national banks to increase their lending towards the public sector will negatively impact their asset yields. Coupled with a decline in public sector deposits, and funding through more expensive private sector liabilities, should further shrink banks net interest margins. If QNB continues with its current hunger for growth, its international position will be much larger in the near future. Within the space of a few months, QNB has begun the due diligence process to acquire the Egyptian unit of Societe Generale; increased its holding in the Dubai-based Commercial Bank International to 40 percent; acquired an increasing stake in Mansour Bank of Iraq to 51 percent; and acquired a 49 percent stake in Libya s Bank of Commerce & Development. It seems QNB is doing its job well, as the latest results show a robust pace of growth. In the first nine months of 2012, net profit rose to QR 6,228 million from QR5,417 million a year earlier. Early in 2012 this performance was recognised by the magazine The Banker, which ranked QNB Group as the region s most valued banking brand. In 2012, QNB leaped five places to become the number one brand in the region, and moved up 77 places to 114th amongst the world s top 500 banking brands. In a world obsessed with the safety in the financial sector, it s worth pointing out that QNB Group has also been named one of the World s 50 safest banks, according to Global Finance magazine. The ranking was created through an evaluation of longterm credit ratings from Moody s (Aa3), Standard & Poor s (A+) and Fitch Ratings (A+) of the 500 largest banks worldwide. The quality of QNB s assets, along with the good projections for the future, are aligned with its current credit ratings, which are the highest in the region and on a par with the best global financial institutions. Established Total assets (Q4 2011) Established Total assets (Q3 2012) Established Total assets (Q3 2012) Established Total assets (Q3 2012) 1997 QR3.7 bn 1964 QR351 bn 1982 QR66.8 bn 2006 QR61.4 bn Qatar Development Bank QNB Qatar Islamic Bank Masraf Al Rayan A non-profit financial institution, QDB is mandated to accelerate the development of the private sector in line with Qatar s National Vision. The largest bank in the MENA region, QNB was named the region s Most Valued Banking Brand by The Banker earlier this year. Named Best Islamic Bank in Qatar for 2011, QIB holds a 36% share of the Islamic banking market in Qatar, and a 10% overall market share. This is one of Qatar s largest Islamic banks. In October, Moody s upgraded Masraf Al Rayan s ratings to A2/ Prime-1 with a stable outlook.

5 wednesday, november Qatar s next generation bank Growth that reflects a robust economy Al Khaliji offers next-generation banking by blending tradition with innovation This past summer, Qatar s al khaliji surprised the banking world once again by offering three 150-gram gold bars one a year for three years to customers taking out a new mortgage loan. The bank s Golden Reward product emphasised the exclusive service targeted at affluent and high net worth customers provided by this leading financial institution. Indeed, al khaliji took home the Best Premium Banking Service at the annual Banker Middle East Product Awards this year, capping what has been a pioneering, and highly successful, four years for this young bank. Launched in just 2008, al khaliji promoted itself as the next generation bank, catching the financial world s attention out of the gate by offering Qatar s first eco-friendly ATMs, featuring environmentally friendly nanotechnology screen displays, power and paper saving features. Its Fusion account was the first interest-bearing service to combine the benefits of both a savings and checking account. The following year, the bank launched two more innovative products, both linked to gold prices: the country s first wealth management guaranteed structured product and a structured deposit, which was heavily oversubscribed. By early 2010, al khaliji was ranked third in Qatar for performance by CPI Financial. By 2011, al khaliji had positioned itself at the forefront of innovative banking. Its Qatarcentric, corporate and treasury led approach and customer-focused strategy had resulted in incredible outcomes, and its executives were being sought after in regional and global conferences for their input and expertise. The bank continued to surprise the financial world with its growth, recording a net profit of QR427 million ($117 million) for 2010, up 155 Our clear business strategy is aligned to the economic reality of the region. Robin McCall, Group CEO of al khaliji percent over Also in 2011, the bank s investor website was ranked as number one across the Middle East, and at the beginning of 2012, Fitch awarded al khaliji with a Long Term Issuer Default Rating of A-, a bank milestone. This trailblazing trajectory was capped by CPI s award for its premium service this past spring. In fact, the product is a full package of services comprised of seven different components under one brand: a dedicated relationship manager, access to upgraded and exclusive Premium centres at the branches, wealth management services, preferential rates on all types of loans, family benefits, and complimentary Priority Pass membership. Additionally, the premier service is convenient Doorstep Banking, which provides for residential or place of work visits from the client s dedicated relationship manager, eliminating the need for branch visits. Headquartered in Doha and listed on the Qatar Exchange since 2007, al khaliji offers a full range of banking products and services to premium, business, corporate and international customers in Qatar. Its subsidiary in Paris, Al Khaliji France, boasts a network of branches in the UAE covering Dubai, Sharjah, Ras Al Khaima and Abu Dhabi, providing customers and businesses with local, regional and international banking services. The group boasted QR27.8 billion ($7.63 billion) in total assets and QR12.7 billion ($3.48 billion) in customer deposits as of 30th June From the time it launched operations in 2008, al khaliji has shown growth in every quarter. Management s stated intention is to remain focused on major corporate and business clients by offering them financing solutions directed to their particular needs. The bank s quarterly results continue to reflect the success of this strategy. On the release of third quarter 2012 results, in which al khaliji showed an increase in net profit of 5 percent to QR378 million ($103 million), Group CEO Robin Mc- Call comments: al khaliji s core business is Qatar-centric with a GCC coverage model. This single market has experienced robust growth rates and our sentiment for sustained returns remains positive given the strong underlying fundamentals. Qatar s hydrocarbon wealth and planned economic diversification bolstered by significant infrastructure build-out in the coming years will drive growth in the banking sector. Established in 1975, Commercialbank has invested in diversification and human capital, providing a strong foundation for growth Our affiliated banks in Oman and the UAE have, again, delivered outstanding financial performances. Andrew Stevens, CEO of Commercialbank Commercialbank, Qatar s largest private sector bank, has recorded a profit every year since incorporation in Today, with Qatar s economy expanding at a robust pace, Commercialbank s sound business strategy and diversification are allowing it to share in that growth. The bank s results for the first nine months of 2012, showed a 4 percent increase in net profit over the same period the year before. Assets rose 8 percent, while loans and deposits grew 17 and 13 percent, respectively. On their own, the results were unquestionably solid, but given that 2011 was the bank s best year to date with a 15 percent jump in profit the figures are even more remarkable. His Excellency, Abdullah Bin Khalifa Al Attiyah, Chairman of Commercialbank reiterated his belief that Commercialbank s success reflects the strength of Qatar s economy and the bank s strategic realignment within it. The Chairman said the bank has played an integral role in the growth and prosperity of Qatar for several decades, and that it remains committed to playing a central role in the development and diversification of Qatar s economy. Qatar s economy has grown steadily in the third quarter, although at a slower rate than in the first half of the year, with demand for credit facilities continuing to be mainly from the Public Sector. Commercialbank has, however, successfully identified opportunities to grow its loan book and its revenues, delivering strong results for the first nine months of the year. We will look to maintain this momentum for the remainder of 2012, he said. Headquartered in Doha, Commercialbank has total assets of QR 76.4 billion ($20.98 billion) as of 30 September The bank offers a comprehensive range of financial services, including corporate, retail and investment services, as well as owning and operating exclusive Diners Club franchises in Qatar and Oman. A strong capital base and decades of expertise have allowed Commercialbank to take a cutting-edge role in Qatari finance. The bank currently offers banking services through a network of 29 branches, 162 ATMs, Internet Banking, Mobile Banking and the largest EFTPOS network in the country. In 2011 the bank underwent a strategic realignment of its corporate and retail businesses and entered into the bancassurance market. These decisions are now paying off, said Hussain Al Fardan, Commercialbank s Managing Director. He added, The operating environment in Qatar continues to be challenging but Commercialbank has delivered a positive performance in the year to date with higher earnings, growth in lending and strong asset quality. The bank remains well positioned for continued growth in the remainder of the year. A successful diversification strategy has also expanded Commercialbank s GCC footprint through a 34.9 percent shareholding in National Bank of Oman (NBO) in Oman and a 40 percent shareholding in United Arab Bank (UAB) in the United Arab Emirates, both of which are strongly positioned to grow their businesses in their respective domestic markets. NBO is the second largest bank in Oman with 66 branches in that country along with three branches in Egypt and one in Abu Dhabi, while Sharjah-based UAB operates 15 branches across the emirates. NBO and UAB contributed QR 190 million to Commercialbank s net profit, according to the September report, a 12 percent increase from NBO and a 32 percent jump by UAB. Andrew Stevens, Commercialbank s Group CEO, commented, Commercialbank maintained the progress seen in the first half of the year to deliver a record nine month profit at 30 September 2012, and our affiliated banks in Oman and the UAE again delivered outstanding financial performances for the same period with strong growth in profitability and lending. For the remainder of 2012, we will continue to focus on growing our domestic corporate and retail businesses and developing the strength of our regional alliance. Commercialbank enjoys strong credit ratings of (A) from Fitch, (A1) from Moody s and (A-) from Standard & Poor s. The bank is listed on the Qatar Exchange and was the first Qatari bank to list its Global Depository Receipts as well as bonds on the London Stock Exchange. Additionally, Commercialbank s Swiss Franc bond issuance in December 2010, listed on the SIX Swiss Exchange, was the first public bond issuance by a Qatari bank in Switzerland. In 2011, the bank was awarded the JP Morgan Quality Recognition Award for Operational Excellence for the seventh consecutive year. Established Total assets (Q2 2012) 2009 QR21.5 bn Established 1975 Total assets (Q3 2012) QR76.4 bn Established 2008 Total assets (Q3 2012) QR32 bn Established Total assets (Q3 2012) 1983 QR 19.7 bn Barwa Bank Commercialbank al khaliji Ahli Bank QSC Part of the Barwa Group, Barwa Bank is Qatar s fastest-growing bank. Net profits for 2011 were 882 percent higher than those posted in This bank boasts strong credit ratings. Fitch, Moody s and Standard & Poor s have awarded Commercialbank A, A1 and A-, respectively. In al khaliji s second year, CPI Financial already ranked the bank third in Qatar for performance. In 2012, Fitch gave it a Long Term Issuer Default Rating of A-. Recently named Best Commercial Bank in Qatar, Ahli Bank enjoys a credit rating of A- with a stable outlook from Fitch.

6 6 WEdnesday, NOVEMBER Qatar builders riding a wave of growth By 2016, the Qatari government will have spent upwards of EUR 176 billion on new infrastructure and construction projects Qatar s building industry has enjoyed unprecedented growth in recent years, the result of a buoyant economy driven by the oil and gas sectors but with pressing needs to develop major infrastructure, housing and social projects. As a result, the skyline and even the geography of Doha have undergone a sea-change, with projects such as the new international airport, the Katara Cultural Village and the artificial island called The Pearl Qatar, a 4 million square-metre exclusive property development built on reclaimed land. Today, the building boom continues but with a different focus. On the one hand, as Qatar prepares for the FIFA Soccer World Cup in 2022, plans are well underway for the construction of hotels, stadiums and other related infrastructure. According to a report by Commercialbank Capital, spending on the World Cup preparations could reach as much as $150 billion (EUR XX billion) in the next five to six years. However, the World Cup won t be the only catalyst for growth. The Qatari government, having invested heavily in the hydrocarbons sector over the past decade, is now moving ahead with plans to promote non-oil industries. Investments in tourism, transportation, utilities, including solar energy, will provide opportunities for builders, as will projects in education and health care. The Qatari government plans to spend $225 billion on construction and infrastructure projects in the period. Commercialbank Capital estimates that the total construction market size through 2020 could be as large as $315 billion. Two of the companies which are set to profit from this activity are Velosi and the Qatar Building Company (QBC), both featured on this page. Neither one is a newcomer; each has established itself as a major player in the building sector and has strengths in particular areas, Velosi as a contractor to the oil and gas industry worldwide; and QBC with its history as a civil engineering company which has branched out into building material supply trading and other areas. Both are well-positioned to take advantage of the upswing in construction as Qatar s government seeks to create a sustainable economy with a wide range of sources for producing wealth, apart from just oil and gas. QBC prepared for World Cup construction boom Raising the standards in oil and gas services The 2022 FIFA World Cup construction spend will likely benefit Qatar Building Company (QBC), the market leader Qatar s government plans to spend more than $100 billion ( 63 billion) over the next decade on developing infrastructure for the 2022 FIFA World Cup competition. One of the companies likely to benefit from this boom is Qatar Building Company (QBC). As the company s Managing Director Ali M T Mustafawi puts it: We realise that there will be a lot of opportunities across our divisions. That is why from now until 2022 it is worth making high capital investments. He says that for events such as the World Cup, It is not about how complicated a project is, but more about how quickly and efficiently you can build stadiums of the highest standards, and the necessary community links to them. Qatar s construction industry is forecast to grow 12 percent a year through 2015, as a result of World Cup preparations. The building sector will also Qatar s building industry is expected to grow by 12% a year through 2015 be boosted by Qatar s National Vision 2030, which has a budget estimated at $800 billion to help diversify the economy and reduce the country s dependence on the petroleum and gas industries. QBC will likely be a beneficiary from all that development spending. A recent report by Commercialbank Capital placed the company among Qatar s top 10 builders in 2011, with $419 million in new contracts. QBC has already secured itself as the most self-reliant company in the Qatari infrastructure market. Established in 1971 as a civil engineering and building contractor, QBC has since built up a broad client base that ranges from government agencies, international contractors, private developers and oil and gas companies. We are involved in almost every major public project in Qatar, says Mr Mustafawi, whether directly as a contractor, or indirectly by supplying the heavy equipment and machines, or the construction materials such as concrete, asphalt and steel. QBC also has different types of collaborations on a per-project basis with prestigious multinational companies. When the company was founded by Mr Mustafawi s father, Mohammed Tayeb Mustafawi, Qatar was enjoying its first development boom, with the construction of schools, hospitals, public housing, and oil and gas projects. Over the years, QBC has seen considerable expansion of its activities, opening its production capabilities in 1981; now, production includes ready-mix and precast concrete, aeronautical-quality asphalt, steel, and fill, sub-base and aggregate materials. Its trading division began in 2000, when it started selling the world s leading brands of heavy equipment. Today, QBC continues to explore new avenues and relationships with technology-holders to develop its business and uphold its command of the industry. What we look for are new areas of business that produce solid, sustainable ROIs, Mr Mustafawi says. We create synergies with reputable companies by showing them the platforms we provide in terms of value-added businesses, production facilities and factories, fleet of equipment, engineering and market know-how, and the long-established client relationships critical for certain projects. Mr Mustafawi underscores that QBC uses the latest technology to be more efficient, protect the environment and stay at the industry s forefront: We lay emphasis on the latest technology and support high levels of capital investment. Velosi has emerged as the preferred supplier of management services in Qatar s energy sector Acquisition of other companies providing complementary services is one way in which businesses can grow, and can be particularly successful when an international market leader links up with a local firm. That s the thinking behind the merger this year between global inspection, quality assurance, and certification company Velosi and Qatar Center for Career Development (QCCD), specialising in management development and training programs. Founded in 1982, Velosi is a leading provider of services to the oil and gas industries worldwide, operating through regional headquarters in the United States, the UK, Malaysia, South Africa, and the United Arab Emirates. In 2011 it became part of the Applus Group, turning the Spanish multinational into one of the largest companies in the field of safety and quality. Velosi has 63 offices in 36 countries worldwide, and in the Middle East employs around 1500 people in seven countries. A market leader in Qatar s energy sector, its clients include leading national and multinational oil and gas companies, such as Qatar Petroleum, Qatargas, RasGas, Qapco, BP, Shell, Exxon Mobil, Petronas, ONGC, and Chevron. Outside of the energy industry, the company sees huge potential for winning business in the construction sector as major new infrastructure projects get under way in the run up to Qatar hosting the FIFA World Cup in 2022 as Velosi is diversifying to infrastructure sector with the help of Applus. QCCD was established in 2007 to offer government and private sector clients a complete range of management soft-skills training programs, cost-effective human resources consultancy, and executive search services. Following Velosi s acquisition of around 75 percent of QCCD s shares, a new entity, Velosi-QCCD, was launched in April. Registered in the Sudhir Pandra, Middle East Regional Manager of Velosi Jersey in the Channel Islands, Velosi- QCCD will operate as an offshore arm of Velosi, Qatar. This new venture is set to provide a fresh and innovative concept of human resources, management, executive, and leadership training under one roof, says Sudhir Pandra, Velosi s Regional Manager, Middle East said at the time the merger was announced. Our combination unites two market leaders Velosi and QCCD in asset integrity, health, safety and environment, quality assurance, quality control, engineering services, and now all forms of specialist HR consultancy and soft-skills management training, and executive development. Pandra says that when they were separate companies Velosi and QCCD shared a common objective to ensure absolute customer satisfaction, providing a professional and ethical service. We remain dedicated to this objective now that we are operating as one. Together, Velosi-QCCD is privileged to serve more than 200 client organizations in more than 45 countries. The depth of our resources and the breadth of our reach are now stronger than ever, he said. One of the objectives is to establish an academy to provide training to meet specific human resources needs in support of Qatar s National Vision Dr. Shaukat Chandna, Velosi-QC- CD s Managing Director, said, There is a great need for proper HR consultancy standards to be established in Qatar to realize the goal set under the Qatar National Vision He says the merger of the two market leaders has created an entity with extraordinary capability that will provide its clients with access to world-class HR solutions. We are now uniquely positioned to provide a diversified range of client organizations with the most comprehensive set of solutions available to extend mission critical services and assure they are managed, secured, compliant, and developed in line with international best practices of management capabilities and values, Dr. Chandna said.

7 WEdnesday, NOVEMBER The Qatar Investment Authority owns London s Shard, the EU s tallest skyscraper Despite Qatar s fast modernisation, traditions remain alive and well, and continue to entice tourists Building a global portfolio Qatar set to become regional tourism centre Qatar Investment Authority looks for quality investments around the world Established just seven years ago, Qatar Investment Authority (QIA) is on target to become one of the world s four largest sovereign wealth funds by 2015, along with those of China, Singapore and Abu Dhabi. With an estimated $85 billion in total assets, QIA has a major role to play in diversifying the country s revenue sources. As Qatar s LNG exports approach their peak capacity, QIA, already the world s 12th largest sovereign wealth fund, is set to benefit from greater purchasing power. Indeed, the fund and its various subsidiaries (Qatar Holding and Qatari Diar) have had more than $30 billion at their disposal to invest in This follows a considerable spending spree during From retail and real estate to energy and banking, the Doha-based fund continues to build its international portfolio at a remarkable pace. In May of 2010, QIA purchased the UK s landmark Harrods Group from Mohammed Al-Fayed for $2.2 billion. Plans are in the works to build a Harrods hotel in Kuala Lumpur (and later in New York City and Paris) next year. This acquisition was followed in September by a $5 billion framework deal between QIA and the Greek government paving the way for future investment in several sectors, including energy and banking. Later that same year, QIA purchased a 5 percent stake in Banco Santander s Brazilian arm, Banco Santander Brasil, for $2.7 billion. In 2011, Qatar spent $466 million on the Shell oil company s building, Shell Centre in London, a precursor to its purchase of a significant stake in Royal Dutch Shell. Along similar lines, QIA has recently picked up a 3 percent stake in France s Total and is in talks to buy a stake in Italy s Eni. The fund has shares in Energias de Portugal and Iberdrola of Spain, as well. In sports, the year 2011 also had significance for Qatar. One of Europe s top football teams, FC Barcelona, began displaying the logo of Qatar Foundation headed by the Emir s wife Sheika Mozah; and QIA bought a 70 percent stake in French football club Paris St Germain. This year, the fund swept up the remaining 30 percent. QIA s strong incursion into France continued when it snatched up a 26,000 square-meter retail complex on Paris emblematic Avenue des Champs Elysées, for EUR500 million. One of the most celebrated promenades in the world, Champs Elysées is the address of luxury brand Louis Vuitton, another name recently added to QIA s portfolio of investments; in March this year, the fund acquired just over a 1 percent stake in Louis Vuitton Moet Hennessy group. In the UK, QIA s name is linked to various important real estate projects, such as the redevelopment of the 95-storey Shard Skyscraper, London s Olympic Park and One Hyde Park residences. Qatar s real estate, banking and infrastructure investments in Britain top $16 billion. Headed by the Qatari Prime Minister, Sheikh Hamad bin Jassim bin Jabr al-thani, QIA operates through two major investment vehicles. Qatar Holding, incorporated in 2006, is the main vehicle for strategic and direct investments, while Qatari Diar Real Estate Company is the fund s property investment arm. Established in 2005 and with an estimated $35 billion in assets, Qatari Diar has investments in the UK, France, Thailand, Morocco, Egypt, Oman and Syria, among others. Currently the company has more than 49 projects either under development or in planning at home and abroad. Most of QIA s high-profile investments, however, have been made through Qatar Holding, including commitments in construction company Hochtief and automakers Volkswagen and Porsche. Focusing on long-term gains and taking advantage of growth opportunities, Qatar Holding generally makes long-term strategic investments, mixed with the occasional opportunistic position from time to time. Spread across different asset classes, including listed securities, alternative assets and private equity, investments have tended to be more focussed in Europe and Asia, with a few in the US, and include France s Lagardere Group, London s Canary Wharf, Singapore s Raffles Medical Group, and the UK s second biggest grocer, Sainsbury s. With its eye on the future, QIA has also invested heavily in the clean technology sector, having created in 2008 a 287 million fund for low carbon investment, in collaboration with the UK s Carbon Trust an independent, non-profit fund set up by the UK government that provides specialist support to help businesses and the public sector boost returns by cutting carbon emissions, saving energy and commercialising low carbon technologies. In March 2010, Qatar Holding signed a letter of intent with Qatar Science and Technology Park, Porsche and Volkswagen to launch a series of initiatives covering areas such as education, research and commercial applications of a broad range of technologies, including both engineering and fuel technology. Qatar Holding has also shown a particular affinity for financial institutions. The company holds shares in Barclays, Credit Suisse and the London Stock Exchange, in addition to shares in the Industrial and Commercial Bank of China and the Agricultural Bank of China. At the end of the day, the fund s main mission is to use the excess revenues from Qatar s oil and gas industry to diversify the national economy, help moderate the effects of fluctuating oil and gas prices, and ensure continued growth after hydrocarbons resources are exhausted. Consequently, Qatar Holding also invests in Qatar, and currently owns shares in Qatar Telecom, Qatar National Bank, the Qatar Exchange and various local banks. Through Qatari Diar, QIA has invested in major infrastructure projects such as Lusail City, the bridge between Qatar and Bahrain, and in a joint venture with Deutsche Bahn, the development of the national railway network. Forecast to be the fastest growing tourist destination in the Middle East, Qatar is investing heavily in new tourism infrastructure Most people visiting Qatar do so for business reasons. However, this is changing as the tiny Gulf state pursues its ambition to become a major player on the regional and international tourism scene by turning itself into a centre for meetings, sports, culture, and leisure. Just how confident the Qatari authorities are about attracting huge numbers of future visitors can be judged by the size of Doha s new international airport, due to open next year. Initially it will cater to 24 million passengers, but further expansion will increase the number to 50 million after The airport has been designed specifically for the Airbus A380 twindeck super jumbo, the biggest passenger aircraft ever built. The World Travel and Tourism Council (WTTC) predicts that tourism in Qatar will grow by around 13 percent this year and double over the next 10 years the fastest growth rate in the industry in the Middle East. The Qatar Tourism Authority (QTA) is targeting a 20 percent increase in the industry over the next five years. And that s ahead of Qatar s hosting of the 2022 FIFA World Cup, an event that will showcase the country to a TV audience of billions across the globe. The Qatari government is eager to diversify the economy away from overdependence on hydrocarbons and believes that tourism has enormous potential in this regard. This is supported by the industry s rising contribution to the economy, both directly and indirectly estimated by the WTTC at $5.5 billion last year, and expected to reach $11.25 billion in Qatar has invested significantly in the development of its tourism and transport infrastructure, building new hotels, resorts, and cultural centers, and the pace of investment will accelerate in the run up to the World Cup. The government plans to spend some $20 billion towards the development of tourism projects, and $65 billion on infrastructure to facilitate tourist movement during the event, including a Metro system for Doha. Meanwhile, Qatar has been busy broadening its tourist appeal. It has already established a reputation for successfully staging large-scale events particularly international sporting tournaments, attracting large numbers of tennis, golf and athletics fans. Last year, it staged the AFC Asian Cup, and for the mega-championship of 2022 it is building nine spectacular new stadiums. Cultural attractions in Qatar range from museums focusing on Arab and Islamic heritage and art, to the Waqif Art In 2011, European tourist arrivals were up by 15 percent, and GCC visitors grew by 50 percent Tourism has great potential to diversify Qatar s economy away from hydrocarbons. Already, the sector contributes directly and indirectly, some $5.5 billion Centre, Katara Cultural Village, and the iconic Qatar National Convention Centre. Shoppers can head for the traditional souks or buy leading international brands in sleek modern malls. Business tourism accounted for 72 per cent of the total number of tourists who arrived in 2011, and Qatar is firmly on the map as a destination for meetings, incentives, conventions, and exhibitions (MICE) tourism. Since opening in December last year, Qatar National Convention Centre alone has attracted more than 136,000 visitors hosted to over 200 events, including major international conferences. Overall visitor numbers are still relatively modest compared with some other Gulf nations, but the upward trend is unmistakable and Qatar is determined to grab a major share of the lucrative regional tourism market. Last year was the most successful yet. According to the QTA, 2011 saw an increase of around 50 percent in visitors from the GCC region, compared to 2010, with some 845,600 arrivals. International tourism figures were also impressive, with a 12 per cent increase. Asian tourists accounted for 58 per cent of the total, while tourism from European countries was up by 15 percent. Doha s hotels enjoyed a record year in 2011, with revenue from four and five star hotels exceeding $1.3 billion. The number of hotels in Doha has doubled since 2010 to around 12,000. Eight new hotels opened last year and more are under construction. Famous international brands like St. Regis and Hilton have recently joined brands like W, Four Seasons, Marriott, and Sheraton in the capital. Hotel occupancy rates across the country peaked at 85 per cent during the recent Eid Al Adha holiday, held at the end of the Hajj, the annual Muslim pilgrimage to Mecca. With more than 10,300 visitors arriving from all GCC countries for the celebrations, Qatar appears to be on track to become one of the main tourist spots for GCC citizens.

8 8 WEdnesday, NOVEMBER Culture as important pillar for growth Qatar strives to develop the nation s potential whilst maintaining culture at the nation s core, thereby blending modernity with traditions Qatar has placed culture and heritage at the core of its development strategy for the future, thus harmoniously blending tradition and modernity Until now, Qatar s rapid economic progress has largely been centred around the exploitation of vast amounts of oil and gas reserves that the Arab state boasts. With speedy growth comes the challenge of preserving cultural traditions and this is a problem that confronts many societies in a swiftly globalising and increasingly connected world. Qatar s escalation has created strains between the old and the new in almost every aspect of daily life. In the modern, highly-competitive world, the capitalistic approach to business often clashes with traditional relationships and values. Moreover, the greater emancipation and variety that complement economic and social progress can pose challenges to deep-rooted social values cherished by a society. Qatar is trying to mould modernisation around local culture and prove that modern life and traditional values can indeed be compatible, and it is doing this through the Qatar National Vision 2030 (QNV 2030) programme. The QNV2030 outlines four guiding principles, on the basis of which the state aims to create a sustainable economy and enhance the standard of living of its people. Therefore up until the year 2030, expansion in both the public and private sectors will be centred on human, social, economic and environmental development. The main objectives of the QNV2030 are to create a society that is educated, capable of playing a key role in forging global partnerships, and one that maintains a balance between economic and social development. In addition to this, Qatar s government feels that community development plays a vital part in obtaining the targets it sets. Any advancement in business or science and technology that fails to engage with and nurture culture and art will not be fully beneficial to the state a strategy that highlights the importance of culture in Qatar s present and future. The Katara Cultural Village will play a significant role in this cultural development. It will exhibit art from Qatar and all around the world, as part of the state s drive to nurture natural talent by providing Qataris with the opportunity to be inspired by art, both old and contemporary. A celebration of culture Qatar s new national museum aims to attract Qataris and tourists One of the first sights to be encountered by travellers arriving in Doha in the near future will be the new National Museum of Qatar. Currently being built at the south end of the Corniche, the striking complex of disk-shaped pavilions will celebrate the culture, heritage and future of Qatar and its people. The innovative design is the work of renowned French architect Jean Nouvel, winner of the prestigious Pritzker Architecture Prize. Hyundai Engineering & Construction of South Korea was awarded the $434 million contract by Qatar Museums Authority last year, and the opening is scheduled for December While the look of the new museum is uncompromisingly modern, its scattering of intersecting disk-like components are designed to echo the petals of the desert sand rose. Nouvel, whose declared intention is to reflect the country s vanishing Bedouin culture, describes it as a modern-day caravanserai. Built from locally sourced concrete The Emir of Qatar accepting the honour to host World Cup 2022 In an ever-changing and digitalised global world, Katara is eager to offer a platform where Qataris can keep hold of their roots and heritage, while still embracing diversity and rejoicing in similarities with the cultures of the world. Recently Katara and Bloomsbury Qatar Foundation Publishing (BQFP) announced a partnership to initiate and support cultural activities through the development, production and circulation of cultural publications. According to Hanouf Al-Buainain, Director of BQFP, Qatar wants to bring culture out to the broader consciousness, and at the same time develop a vibrant literacy publishing scene within the state. He foresees that this joint venture will result in Qatar producing a number of books in English and Arabic in the immediate future. He also thinks that the and steel, the museum will comprise 430,000 sq ft of indoor space, including 86,000 sq ft of permanent gallery space, 21,500 sq ft of temporary gallery space, a 220-seat auditorium, a 70-seat food forum and TV studio, two cafes, a restaurant, and a museum shop. Surrounding it will be a 1.2 million sq ft landscaped park in the style of a Qatari desert landscape. The restored Fariq Al Salatah Palace, which has served as Qatar s national museum since 1975, is integrated into the design. Originally built in the early 20th century by Sheikh Abdullah bin Jassim Al Thani, and for 25 years the seat of government, the palace is being preserved as the heart of the new museum. At this unparalleled new institution, Qataris will be able to discover more about their immediate ancestors and their roots in the region, learn about the formation of Qatar s early cities, and above all be exposed to the historical, material culture and intangible heritage represented in the collections, says Peggy Loar, the National Museum s director. However, it is not just Qatari citizens that the new museum is intended to attract. Qatar, which already boasts a Museum of Islamic Art, an Orientalist Museum, and a Museum of Modern Islamic Art, is targeting 20 per cent growth in tourism over the next five years, and culture will play an important part in pulling in visitors, particularly from other GCC states, such as Saudi Arabia, Kuwait, and the United Arab Emirates. Katara: living culture Realised out of a vision to establish Qatar as a cultural beacon of the Middle East, the cultural village at Katara is a world-class exhibition space that has been designed to spur the participation of Qataris in cultural activities and encourage greater exploration of the emirate s rich heritage. A true nation-building endeavour, the $82-million project is held as a key contributor to the social and human development of the country. Built on reclaimed coastal land between Doha s West Bay and The Pearl-Qatar, just to the north of the capital s city centre, Katara includes heritage centres, libraries, art galleries and other academic facilities, in addition to retail outlets, coffee shops, museum facilities and market areas. Katara had a soft opening in October 2010 during the Doha Tribeca Film Festival (DTFF). According to Marcio Barbosa, managing director of Katara and former joint director at UN- ESCO, the cultural village has the challenge of, on one hand, preserving the traditions and historic values of the country and, on the other, offering cultural opportunities modern ones through different manifestations, like music, art, theatre and cinema, among others. The idea is to show that, in culture, the country has a strategy of coexistence of the ancient and the new, he says. Many Qatari organizations already have their offices at Katara, including the Qatari Society for Engineers, Qatar Fine Arts Society, Visual Art Centre, Qatar Photographic Society, Childhood Cultural Centre, Doha Film Institute, and the Qatar Music Academy. partnership will initiate a common cultural awareness that will allow Qataris to appreciate cultures from across the world and will ultimately reinforce the development of a creative and innovative Qatar, as well. A prominent event on the cultural itinerary is the Doha Tribeca Film Festival, the annual cultural showpiece of the Doha Film Institute. Held this year from 17th-24th November, the festival showcased homegrown talent with a selection of 19 films by local filmmakers, including nationals and expatriates based in the country. This year marked the largest exhibition of Made in Qatar films, underlining the significant strides achieved by Qatar s emerging film industry, with 15 premieres being shown as part of the overall festival line-up. Another 87 films were screened from across the globe. The films will compete for the Made in Qatar development award of $10,000, awarded by an independent jury. The Qatari cultural revolution now also has a website to act a reference point. The Minister of Culture, Arts and Heritage HE Dr Hamad bin Abdulaziz al-kuwari recently launched the website for the Qatar cultural gate. The project forms part of the Ministry s plan to improve its services to keep pace with the developments in the field of information technology. The purpose-built cultural village of Katara has already hosted various highprofile events and spurred many Qatari organisations to set up there The 247-acre cultural village features a massive open amphitheatre, opera house, cinema that can double as a drama theatre, a multipurpose hall, beach, handicrafts souq, book market, international restaurants and cafes, The idea is to show that, in culture, the country has a strategy of coexistence of the ancient and the new. Marcio Barbosa, Managing Director of Katara and ample space for visitors to stroll around the different areas of the project. The themed restaurant area has eateries that are exclusive to the Middle East and Katara s minaret centre is based around three towers, one of which a hotel will be Qatar s tallest.