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Is Qatar already a winner?

Published : Saturday, 26 November, 2022 at 12:00 AM  Count : 586

Is Qatar already a winner?

Is Qatar already a winner?

The greatest show on earth has just commenced, and everyone is busy predicting the winner of the FIFA World Cup 2022. The most enthusiastic supporters are mostly from Brazil or Argentina, and they are actively participating in various debates around the world.

On the other hand, another group is rooting for the European region to keep the cup within itself by supporting mostly Germany and France. Well, the first match between the host Qatar and Ecuador in Group A was a clear win for Ecuador, making a host country lose the first match after 82 years. But what if I say Qatar is already a winner by hosting the World Cup? This might get me into trouble with the Brazil-Argentina fans, but if the economic and geopolitical benefits are considered, Qatar is on the verge of winning the economic game by organizing the most expensive World Cup to date.

It is mostly expected that organizing global events will have a direct positive impact on the economic situation of the host countries. The Olympics and World Cups are profitable ventures. With its $10 million profit from the 1992 Olympics, Barcelona unquestionably became the poster child of triumph in presenting a major occasion. But this is only one side of the coin. On the contrary, the 2016 Rio Olympics suffered a $2 billion loss, and Greece's massive Olympic debt from the 2004 Athens Games hastened its bankruptcy. So, the previous illustrations are contradictory. So, can we be sure of the economic roadmap for Qatar that will lead to gains?
An astounding $220 billion has reportedly been spent by the nation since 2010. This is fifteen times what Russia spent on the competition in 2018. The Brazil World Cup was the most expensive before this one. Not only that, but the state has invested more than $300 billion in infrastructure improvements for oil and gas supply, building a new city and port, a new airport considering the number of spectators, the Doha metro, and other transportation facilities.
 
Financial analysts forecast that Qatar's GDP will increase by 4.1% by the end of this year as an outcome of the World Cup, according to several reports. Furthermore, the region's GDP will grow by an average of 3.2% between 2022 and 2030. According to reports, Qatar's economy will benefit more than $20 billion from the 2022 FIFA World Cup.
 
The economics behind Qatar's acceleration in the global market are structurally based on the capital inflow. A report from Al Jazeera claims that $4 billion in foreign investment has already entered the nation in the first ten months of the year. In fact, the Qatar Stock Exchange (QSE) has outperformed its competitors in the run-up to the major sporting event. And even a year after the competition, this is expected to persist.
 
A big event is a stage in building up the image of a nation in terms of attracting foreign investments and the tourism sector. Using the World Cup as a springboard, several projects are being pushed to completion before the World Cup. Technically, the government considered 2022 a deadline after winning the bid to organize the World Cup in 2010. As a result, from an infrastructural development viewpoint, the hospitality sector, which includes hotels, shopping centers, and retail, will benefit the most. Many listed small- and mid-cap businesses that received government contracts over the past few years as suppliers to bigger businesses will also profit. Among them, he said, are companies that supply building supplies and paving stones, as well as apartment rentals and security services.
 
The common narrative of a MENA country is that it solely depends on the oil market for financial aspects. The World Cup is a means for Qatar to promote and develop more regional industries and break free from its reliance on oil and gas. Working with young companies like Arvex and sKora inspires more local companies and entrepreneurs, making the startup culture more popular in the upcoming decades.
 
The event will have a positive impact on the tourism industry. Tourist arrivals are expected to exceed five lakhs on the busiest days. According to several reports, the Time Demand Model predicts 1.7 million tourists, according to the estimated forecast. Additionally, it's anticipated that 3.08 million tickets will be sold for the event. The average stadium seating capacity is between 40,000 and 80,000 people. The tourism industry is expected to experience a boom after the COVID-19 blockade for the last three years.
 
According to FIFA's estimates, around 110,000 passengers will be traveling each day during the event. It is anticipated that these numbers will abnormally rise during the knockout round. This is going to be a major driver for the airline business in Qatar.
 
Foreign investment increased in Qatar and is likely to continue to do so in the years to come. To accommodate the large customer base during the tournament, numerous brands and businesses made investments in Qatar. The event is anticipated to boost Qatar's economy by 1.5 million jobs, which is going to be a solution for unemployment. Although this employment is not sustainable.
 
In a nutshell, Qatar is transitioning to a more sustainable economy by incorporating a number of business ventures that will eventually free Qatar from its reliance on hydrocarbons. Also, the infrastructural changes are obliged to benefit Qatar over a longer period in terms of generating revenue for the government. So, my narrative of calling Qatar a winner in terms of global trade is somewhat rational. Whoever wins the World Cup, Qatar has already paved the way to economic victory.
MD ShiyanSadik is currently working as a Research Associate at the Centre for Policy Dialogue (CPD)















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