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	Qatar		Info-Prod Country Guide
CHARACTERISTICS   INDICATORS   THE ECONOMY   INVESTMENT ISSUES   PROJECTS   PROSPECTS

Current and Projected Projects General Sheikh Hamad's liberal policies have encouraged foreign companies to invest billions of dollars to develop the Ras Laffan field and to set up a string of costly liquefied natural gas (LNG) and other hydrocarbon-based projects. Qatar plans to invest up to US$ 18 billion in developing its gas production and export infrastructure by the turn of the century, as well as boosting crude oil exports. Phase 2 of its development plan involves the construction of a gas liquefaction plant and port at Ras Laffan by state-owned Qatargas. This US$ 6 billion development is set to have an output of 6 million tons/year by the turn of the century. Other projects involve the construction of a joint venture ten million tons/ year plant by Rasgas, a planned five million tons/year plant by Enronand and a four million tons/year plant by Elf and Sumitomo. By the year 2000, Qatar hopes to be exporting sixteen million tons/year, mainly to the Far East. Funding the development has, however, been a problem. Qatar has structured its investment plans such that the government has a majority stake in most projects, meaning that Doha has an insatiable demand for capital. Although state spending has been cut in some categories in recent years in order to save money, most of the investment has come in the form of commercial loans. The Qatar Liquefied Gas Company started to export to Japan in January 1996. Ras Laffan LNG Company (Qatar's second gas exporting venture) has also broken new ground in project financing by tapping the international bond market, to the tune of US$ 1.2 billion. Germany's Uhde is involved in an ammonia-urea project for Qatar Fertilizer Company. The German turbine manufacturer ABB Kraftwerke was tapped for a US$ 1.1 billion electrical project at the Ras Abu Fontas plant, where capacity is being doubled to 1,250 MW. Qatar concluded a large arms deal with the UK in September 1996 valued at over US$ 800 million and involving the purchase of patrol boats, personnel armored carriers and missiles. Project Finance To promote its ambitious development plans, Qatar taps the international money markets on a regular basis. Even though the national debt is equivalent to 77 percent of GDP, international financiers are still lining up to lend substantial sums. General syndication closed on a US$ 250 million sovereign loan for balance of payments support. In March 1996, commitment letters were signed with a banking group headed by Industrial Bank of Japan to provide non-recourse financing for up to 75 percent of the US$ 1 billion liquefaction plant contract for Rasgas. Qatar enjoys high credibility in the international markets because it has painstakingly built up an impressive portfolio of project financing deals over the past three years. Its economic prospects over the medium-to-long term are bright, given the revenue forecasts for Qatargas and Rasgas. Franchising Qatar has no special rules or regulations governing either licensing or franchising operations. Moreover, there are no restrictions on the payment of fees and royalties. Firms interested in licensing or franchising their operations in Qatar, however, should identify local agents. The restrictions and precautions which apply in the case of appointing local agents for products and services also apply in franchising. Presently, there are few franchise operations in Qatar (mainly fast food services), and all are reported to be doing well in a market of no more than 400,000 inhabitants. Previous Chapter Contents Menu Next Chapter

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