contents February 2015
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Special Feature: The Edge analyses the influences and implications of the shootings in Paris, France on January 7, 2015.
42 Water and energy conservation are key priorities for Qatar when developing green buildings. According to the Qatar Green Building Council’s Meshal Al Shemari, in Qatar the biggest consumers of energy are heating, ventilation and air-conditioning systems.
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Business Interview: Supporting Qatar’s Sustainability Agenda 42
Qatar’s representative for the World Green Building Council, Qatar Green Building Council (QGBC), is driving the country’s sustainability agenda. In an interview with QGBC’s director, engineer Meshal Al Shamari, Farwa Zahra explores Qatar’s current position on sustainable development, and QGBC’s ongoing and upcoming projects to support the nation’s green agenda.
Feature Story: Global outlook for Islamic Banking
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While the growth in shari’ah-compliant assets around the globe has been exponential since their widespread emergence in the 1970s, the prospects of the Islamic banking industry have not been so unequivocally positive during that time. But global analysts have pegged the fortunes of the Islamic finance industry on a six-nation bloc that includes Qatar, writes Simon Watkins.
Special Section: Automotive Retail 55
The Edge takes a look at some new automotive models for 2015.
With Qatar entrenched in the six nation bloc dominating Islamic finance, the economic hub of Doha is becoming increasingly prominent in the sector, especially in the subsector of shari’ahcompliant banking. (Image FotoArabia)
The Edge | 3
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Banks in Qatar follow a holistic growth model while maintaining a dedicated teams approach to financing different asset classes. Speaking with The Edge, banking experts focus on business drivers. Doha’s Grand Hamad Street, popularly known as Bank Street, houses a number of banks. The International Monetary Fund Board, in their consultation with Qatar last year, observed that banks remain well capitalised, liquid, and profitable. (Image Arabian Eye/Reuters)
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Energy & Sustainability 27
In direct contrast to its neighbours in the Middle East and to the vast majority of hydrocarbon-centric economies elsewhere around the globe, the decline of world oil prices has the potential to yield more positives for Qatar than negatives.
Real Estate & Construction 31
With the reopening of the Sheraton Doha Hotel, Doha has regained 371 keys for its hospitality sector and experts forecast that 2015 will bring a large number of new keys and a growth rate of 25 percent by Q3.
Tech & Communications 33
IT investment in the Middle East has led to a massive enterprise infrastructure sprawl. The inevitable byproduct of all this has been increased complexities around IT management as organisations across the region are now generating huge amounts of data.
Business Insight 61 Carmen Haddad, CEO, Citibank NA – QFC Branch (Citi Qatar) – spoke to The Edge “When you look after private clients, it’s paramount to about her career be able to deliver bespoke with the organisation global solutions with an understanding of local and the bank’s specifics,” Carmen Haddad, CEO, Citi Qatar told The Edge. plans. In an exclusive conversation with The Edge, U. Achu, general manager of Dyarco, spoke about how the group, comprising 42 companies, is managed by implementing basic business principles.
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From the Editor 8 Photo of the Month 10 Business News 12 Qatar Perspectives 18 Products 67
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ADVANCE PAYMENT AND PERFORMANCE GUARANTEES IN QATAR: AVOIDING THE PITFALLS In the context of construction contracts in Qatar, employers require contractors to provide advance payment guarantees and performance guarantees in the form of unconditional, irrevocable and on demand bank guarantees to secure advance payments and the contractor’s performance, respectively. As the guarantees are unconditional and on demand, the issuing banks are obliged to pay upon demand regardless of whether the call on the guarantees is justified or arbitrary. The Qatari Civil Code (Law No. 22 of 2004) neither addresses nor governs the provision of such guarantees, and thus, the parties must define the rules and restrictions applicable to guarantees within the contract. Contractors, in particular, must assume a more proactive role to ensure protection of their rights especially given the irrevocable and on demand nature of the guarantees. ADVANCE PAYMENT GUARANTEE An advance payment guarantee secures the advance payment issued by the employer to the contractor. In most instances, the advance payment is recovered by the employer during the contractual period in the form of deduction which is an amount deducted by the employer from certified payments due to the contractor to offset the advance payment. In practice, some construction contracts provide for the periodic reduction of the advance payment guarantee to reflect the advance payment amount remaining after adjustment however provide no procedural mechanism to effectuate such reduction. In some instances construction contracts provide for deduction but completely fail to address the reduction of the advance payment guarantee. Such contractual discrepancies result in situations unfavorable to the contractor in that the employer recovers part of the advance payment while also holding an advance payment guarantee in excess of the actual remaining advance payment. This becomes a point of serious concern for the contractor if the employer is dissatisfied with the contractor and arbitrarily calls on the guarantee for the purposes of pressuring the contractor. As a practical consideration, contractors must ensure that the contract provides a detailed mechanism for the periodic reduction of the advance payment guarantee as the advance payment is recovered by the employer. A contractor may achieve the foregoing by contractually requiring the employer to notify the issuing bank at pre-determined increments (i.e. every two months) to reduce the advance payment guarantee. The contractor may also request that such language of reduction be included within the text of the guarantee itself. Finally, it is strongly recommend that the contractor diligently require the issuing bank to update the guarantee reflecting the reduction of the value of the guarantee.
PERFORMANCE GUARANTEE A performance guarantee or performance bond secures performance of the contractor’s obligations in accordance with contractual specifications through
the warranty period. In common law jurisdictions, the legal framework applicable to performance bonds is well established and prescribes instances where an employer may call upon the performance bond. In Qatar no such jurisprudence governs the call on performance guarantees, and the Civil Code is silent in this regard. Therefore, as the performance guarantees are required to be “unconditional, irrevocable and on demand”, contractors are strongly advised to ensure that the contract stipulates detailed instances when the employer may call upon the performance bond. If possible, the contractor may also consider listing the same on the performance guarantee itself. In the event of an arbitrary call by the employer on the performance guarantee, the contractor may file an injunction before the courts. Noting that injunctions of this nature are rarely granted, the contractor would have a more sound basis to argue against the call if the contractual language is clear and defines in detail when an employer may call on the performance bond. If an injunction is rejected by the court and the parties proceed to litigation or arbitration to settle their dispute, the contractor’s position to challenge the call on the bond and seek damages would be made stronger by clear contractual language.
ZEHRA MANNI Associate Al Tamimi & Company z.manni@tamimi.com Follow us on Twitter @AlTamimiCompany Join us on LinkedIn – Al Tamimi & Company www.tamimi.com
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6 | The Edge
editor’s letter In our lead story this month, we deviate from our regular core business features to offer commentary on the tragic incidents that occurred in France recently. Central to the debate following Charlie Hebdo is the issue of freedom of speech, in particular how it impacts respect for religious beliefs. What constitutes the line between the two? Who decides on this boundary? Is it universal or applied in different ways in different contexts? And who polices it? What is the appropriate punishment for alleged transgressors? These are all difficult questions that lead from this narrative, and not just through the prism of religion, but also at a time when press freedom itself on a secular level is under unprecedented attack in both the developed and developing worlds. Journalists and citizens are being imprisoned and killed everywhere just for reporting facts or merely expressing opinions. But that is another conversation. When it comes to the particular discussion in focus, Charlie Hebdo, it is both unfortunate and inevitable that this subject often leads to it being framed into an ‘East versus West’ clash of civilizations or cultures. Indeed, in the relevant context – if this narrative is to believed – you have the citizens of Western Europe, the United States (US), Canada and Australasia on one side. And on the other, the peoples of the East (ostensibly parts of eastern Europe, the Middle East and North Africa and South-East Asia); both are from different planets, all trying to assert their dominance over this one. This of course is a simplistic and dangerous point of view. Yet it is one that sensationalist media outlets chasing eyeballs and cursor clicks focus almost solely in order to shamelessly increase sales or push their agenda. It is also espoused by radicals on either side of the spectrum, from the purveyors of terror in the Middle East to the champions of xenophobia in Europe and the US. Indeed, unfortunately this kind of labelling, stereotyping and polarisation of people is all too common. They enable many groups (and some media) to neatly categorise things, and those on the extreme fringes of society to justify all manner of radical views.
While on the surface it might feel as if this subject matter does not have a place in a business magazine such as The Edge, when you look at the bigger picture, it arguably does. In reality, thanks to globalisation and unprecedented numbers of people migrating across the globe for various reasons, some humanitarian but mostly economic, the line between East and West is ever blurring. Especially considering that South America, subSaharan Africa and much of mainland Asia fit outside this crude ‘East versus West’ paradigm, or combine elements of both the mostly secular West and mostly Islamic middle orient. We are all connected and like the movement of people, the intricate global links of trade and business are myriad. That is why I believe that this story is not just religious, social, cultural or even one that should be focused on freedom of speech. To me it rather highlights the need for all humans to dwell on our commonalities, overcome our differences and proves we must work harder together to make the world a better place. Saccharine perhaps, but also equally true. Any long-term friction between factions of humans can only lead to mass poverty; examples in history of the effects of strife and war on individuals and the global economies abound. As humans we have to get along, and, in fact, in order to trade and exchange services unhindered, our very survival depends on it. The intimate diplomatic and business relationships and volume of trade between Qatar and France is a prime example. Thus in our cover feature on page 36 guest writer, Yadullah Ijtehadi, an experienced Muslim business journalist with many years in the Gulf, who is now based in Canada, offers a compelling perspective as to why and how the vast majority of peace loving Muslims across the world can contribute to that utopian ideal. This is no doubt one of the biggest challenges of the modern world. If those in ‘the West’ reciprocate - and there is no reason to imagine why the vast majority of equally ‘moderate’ folk there would not – we can be more optimistic about the future. Perhaps in that sense what happened in France on January 7, 2015 was a tipping point and if any good can be taken from this, it might engender further positive debate on these issues and lead us all toward a more peaceful, prosperous era.
We are all connected and the intricate global links of trade Miles Masterson and business are myriad. Managing Editor 8 | The Edge
Doha’s Double 10 | The Edge
photo of the month
In January 2015 Qatar’s Team Mini rally driver Nasser Al Attiyah won his second Dakar Rally title in South America. Al Attiyah last won the event in 2011 and placed consistently in the top three in recent years. The victory placed him among a small elite of multiple Dakar rally winners, confirming the Qatari as one of the all-time greats of the sport. Humbly Al Attiyah, who also achieved bronze in skeet shooting at the 2012 Olympics in London, credited his extensive driving and sporting experience as making the difference in taking the win. 2009 Dakar winner South African Giniel de Villiers came second in a Toyota and Poland’s Krzysztof Holowczyc placed third. (Image Arabian Eye/Reuters) The Edge | 11
news
business news
Qatar’s technological ambitions: The future is now
main story
Doha faces challenges in developing its technology infrastructure to meet its development and ‘knowledge economy’ aims. With the announcement of another milestone in Qatar’s satellite programme coming at the end of last year, the body of material evidence suggesting significant recent ICT sector development in the state has grown in both size and quality. A launch date for communications satellite Es’hail 2 has now been set, while sector professionals have been expressing confidence that a range of services, from e-government to health, are also now going into orbit, writes Oliver Cornock of Oxford Business Group (OBG). Space transport may still be far off, but transportation is one of the areas where ICT has an increasingly important role to play and where many of those opportunities can be found. The government has committed some USD70 billion (QAR259 billion) to transport infrastructure development in the next few years under its Qatar National Vision 2030 and Qatar National Development Strategy 2011-2016. Across the whole range of giant transport projects currently underway, from the Doha Metro roll out to Qatar Rail, and from roads to port construction, intelligent transport systems (ITS) have been given a vital role in ensuring that not only commuters, but future World Cup 2022 crowds, can get around the city with the minimum of delay. “Transportation is undergoing a massive transformation that requires intelligent IT planning, control systems and solutions, as well as modern technology infrastructure,” Yousef Al Naama, CEO of IT service and solution provider Malomatia, recently told OBG. “Qatar is at a very important stage in its development. This presents IT opportunities across the public and private sector.” Ashghal’s 2012-2020 ITS Qatar’s Es’hail 1 launched from Action Plan seeks to create a Europe’s Spaceport in Kourou, French Guiana in August 2013. single, comprehensive system that (Image courtesy Es’hailSat) integrates information from all the
“This presents IT opportunities across the public and private sector.” - Yousef Al Naama, CEO, Malomatia. 12 | The Edge
state’s transportation networks in real time to manage transport provision via a national transportation management centre. ITS also links this centre to smartphone or GPS systems of those on the move, providing them with up-to-date travel information. Ultimately, ITS also forms part of an IT system integrated at an even higher level, the Smart City. At that level, transportation is just one of numerous branches feeding information into a system that includes everything from e-government services to cinema opening times. Getting to that stage requires a major investment in IT infrastructure – and also in human resources. In many ways too, it is the latter requirement that can be the most challenging. Qatar’s move to a ‘knowledgebased economy’ is one factor behind the surge into ITS and the satellite programme. Yet, as many IT sector insiders recognise, Qatar remains a net importer of knowledge. Building a national resource base in ICT is thus a key part of overall sustainable development, with companies such as Malomatia keen to stress that they are doing their part. “We are a local company committed to building and sustaining local capabilities,” Al Naama added. Fortunately, Qatar also has excellent access to some major local IT cultures, such as that of India, as well as to Europe and North America, and has been able to bring in a great deal of expertise – with knowledge transfer a key part of the expatriate role. In the meantime, the ongoing development of domestic skills and talent will continue to take place while physical technology races forward – as fast as the ITS-integrated high speed trains, or indeed, Es’hail 2.
The future looks positive for IT in Qatar, said Yousef Al Naama, CEO of IT service and solution provider Malomatia.
news
by the numbers Regulations needed to monitor HVAC in Qatar Every year, a large part of Qatar’s locally-consumed energy goes into heating, ventilation and air-conditioning (HVAC). Jaygopal Kottilil, senior manager of MEP Engineering at Tanween, Qatar, discusses sustainable HVAC in Qatar and argues more for stringent controls. HVAC influences four key subjects in good measure, namely: energy efficiency, water efficiency, indoor environment quality and operation and maintenance of the facility throughout its life. These aspects significantly influence the ultimate objective of ensuring that our planet will be habitable for years to come. In my view, Qatar, being such a wealthy, fast developing country, should also be a world leader in this area. Undeniably there has been considerable improvement on this front in Qatar in the past decade of course. This is certainly encouraging, acknowledging the fact that Qatar has rich reserves of energy. Owners, designers, contractors and facility operators, nowadays, appear to seriously address green issues in many of their projects. However, I firmly believe Qatar still has a long way to go. An estimate, regardless of the nature of buildings, indicates that about 28 percent of the initial cost of mechanical, electrical and plumbing works are attributable to HVAC installations. This aspect invites serious consideration in the overall development cost. How can we optimise this? Reaching an answer requires collective thought by all design disciplines, be it architecture, structural engineering, electrical engineering or interior design. If we are serious about creating sustainable developments across the country, I personally believe that a firm and strong instrument for enabling this is necessary. In my opinion, Qatar government should set specific benchmarks for energy and water efficiency as bare minimum statutory requirements and enforce them in all developments. I also strongly believe Qatar is conscious of the need for hastened economic development, particularly in the context of the FIFA 2022 World Cup, but that it has to be achieved without compromising on the environment. The Qatar National Vision 2030 is a testimony to this commitment. Numerous infrastructure developments in Qatar are currently planned and built consistent with certified green standards. However, these are still voluntary. The truth is that every one of us has to accept the fact that sustainable design approach should not be taken as a forced and imposed one by law, but should be made a habit in all designs. We therefore need more stringent regulations to monitor and control HVAC designs in all developments in Qatar.
USD
57
NUMBER OF THE MONTH Qatar’s budget oil price benchmark for 2015-2016, according to predictions discussed at a press conference in Doha in January, by Afa Boran, Amwal head of asset management in Qatar.
Global technology and communications predictions for 2015 This year...
1.35 billion
smartphones will be bought and of these
will be upgrades
one billion
For the first time the smartphone upgrade market will also exceed
60%
1 billion
of these devices will be for Internet of Things (IoT) devices to be used by enterprises, not individuals In 2015 IoT specific hardware is expected to be worth
and enterprise services enabled by these devices up to
USD
USD
billion
billion
10
70
300,000 220,000 non-military drones will be bought
3D printers worth
USD
1.6
billion
will be purchased
80%
in the enterprise market
and more than
500
nanosats (satellites under 10 kg) will be launched
In e-commerce in Europe alone the click and collect market will increase by
20%
Of the more than 1.75 billion smartphones in use
10%
will be used to make an instore payment at least once a month
The number of homes with broadband internet will increase by
2% 724 million to
and access speeds will increase in most countries by
20%
Source: Technology, Media and Telecommunications (TMT) Predictions 14th Edition - Deloitte; www.emarketer.com
The Edge | 13
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business in quotes
“The world economy is facing strong and complex cross currents. On the one hand, major economies are benefiting from the decline in the price of oil. On the other, in many parts of the world, lower long-run prospects adversely affect demand, resulting in a strong undertow.” Olivier Blanchard, the International Monetary Fund (IMF) chief economist, quoted in the text of remarks at a press conference in Beijing in January, where the IMF made the steepest cut to its global-growth outlook in three years, from 3.8 to 3.5 percent.
“Qatar Airways is expanding rapidly, not only in terms of new destinations and our network offering, but also with the service we offer. Complementing our fivestar service in the skies are our transfer facilities at the newly unveiled stateof-the-art Hamad International Airport.” Qatar Airways CEO Akbar Al Baker at a press conference in January announcing new flight routes to Sofia, Bulgaria. Earlier in the month Al Baker had commented that the rise of his airline as well as Emirates and Etihad were “creating a lot of concern for the European airlines who cannot keep up. We in the Gulf are leading the aviation industry today.”
14 | The Edge
Business News in Brief Jaidah Automotive Announces Return of SeeMyDoha Competition
Exhibition of selected entries for SeeMyDoha photography competition.
Jaidah Automotive, the exclusive dealers of Chevrolet branded motors in Qatar, announces the return of its SeeMyDoha photography competition. It expects to receive more pictures after a record of over 90,000 photos have been submitted since the contest began in April 2013. The competition uses camera-enabled smartphones and the social media platform Instagram, and is running for three months, beginning on January 18.
Dates Announced for Internet of Things World Forum 2015 Cisco, in partnership with industry steering committee members has announced that the Internet of Things World Forum (IoTWF) 2015 will take The 2015 IoTWF promises place in Dubai to shape and accelerate the IoT for governments and industries worldwide, from December said Wim Elfrink, chief 6 to 8, 2015 at globalisation officer, Cisco. the Dubai World Trade Centre. The third annual IoTWF aims to convene top thought leaders, implementers and creators across public sector, private business and education from across the world to collaborate, network, partner, and build the industry’s ecosystem together.
business in brief Ooredoo Group wins EMMA Award
news
Start-up Watch
Mohanna Al Nuaimi, group chief human resource officer, said a major part of Ooredoo’s successful transformation comes from investment in their team.
Ooredoo Group’s Global Talent Mobility Programme has been voted as the best in the Technology and Media sector for the Europe, Middle East and Africa region at the Expatriate Management and Mobility Awards (EMMAs) held in London recently. In 2013, Ooredoo’s Global Talent Mobility Programme underwent a major transformation enabling the delivery of talent deployment strategies and solutions to accelerate corporate initiatives and tackle business challenges.
Dentons wins accolades at the Islamic Finance News Awards 2014 Dentons has won two awards at the IFN Deals of the Year 2014, which recognise the excellence, achievement and leadership of those who have participated in the industry’s most groundbreaking transactions. Dentons advised on the ‘Cross Border Deal of the Year: The Islamic Corporation for the Development of the Private Sector (ICD)’. It also acted on the ‘Qatar Deal of the Year: Ezdan Holdings’.
Pinsent Masons launches Middle East tax practice International law firm Pinsent Masons has announced the launch of a tax practice in Doha to capitalise on work arising from Qatar and the United Arab Emirates’ decision to join the Organisation for Economic Co-operation and Development initiative relating to transparency of tax affairs. Ian Anderson, who joins from the Qatar Financial Centre, will launch the firm’s Tax practice in the Middle East, focusing on multinationals with a tax presence in the region.
Qatar’s Ginger Camel are hopeful to strike a winning formula with their new podcast format. “The new series will be marketed to an international audience along with local ones,” says Ginger Camel’s Andrew Clark.
This month we take a look at an already established media offering in Qatar, the Doha Heat podcast, which is evolving into a more comprehensive and inclusive entity under its host, Ginger Camel. The Edge spoke with its custodian, Andrew Clark. You are set to launch a new venture in 2015 to replace Doha Heat. Ginger Camel Media Network (GCMN) will be launching in April, bringing with it a family of podcasts focused on providing positive, uplifting perspectives to a global audience. The idea to launch a digital media network stemmed from a series of early morning conversations with my managing director at Ginger Camel, Stefan Lindberg-Jones, who has helped me in growing our initial, Doha-based podcast Doha Heat. We found ourselves repeatedly wanting to pursue something complementing Doha Heat. Can you elaborate more on the structure of the Ginger Camel Media Network and its podcasts? GCMN will include the publishing of eight podcasts: Empower World, Hot & Healthy, Family Pickers, ILoveQatar, The Edge business news, an Arabic language programme, Doha Heat, and a Qatar-focused real estate programme. Doha Heat, along with the ILoveQatar and The Edge podcasts, will continue to be marketed predominately to Qatari and Middle East and North Africa audiences. I am excited to see Doha Heat return to its original vision, which was to capture and share local individuals’ stories.
Doha Heat is a pretty open forum. Do you see this changing as the project evolves? The nature of a podcast generally facilitates a degree of fluidity and in turn, vulnerability that may not be present in other media. With regards to this particular venture, I think that as more people become exposed to GCMN and its approach to conversations, the ethos will be self-perpetuating and future expansion will continue. That being said, the series’ audio quality and the breadth of topics covered will hopefully continue to improve as we attract sponsors and new partnerships. My experiences elsewhere have shown that great ideas and personal energy can only carry start-ups so far, and that additional funding streams are required in order to achieve new levels of success. Is this a viable business model? The network is currently offering four advertising spots per episode to sponsors. Although I cannot offer data from my work just yet, I can point to viable examples. The website, Audible.com, which offers audio books, has become a sponsor of numerous American podcasts with huge success, like NPR’s Planet Money and the Nerdist Podcast. The sponsor gets an on-air mention prior to each episode, as well as a link inclusion on social media platforms attached to the podcast. GCMN programming would seek to emulate something like this approach with local and international sponsors. Catch The Edge’s weekly podcast on Doha Heat. The Edge | 15
news
events
H1 2015 Qatar Business Events Calendar February 3-5 February 8th Middle East Artificial Lift Forum 6-10 February Qatar Motor Show
8-10 March Multaqa 10-11 March Qatar Chamber 1st SME Conference - Qatar/Germany 23-24 March 6th Annual International Translation Conference
6-7 May Future BIM Implementation Qatar 6-7 May HVAC-Tech Qatar 11-13 May Cityscape Qatar
24-25 March Energy Efficiency and Conservation Forum
April 13-14 April Arab Future Cities Summit 12-19 April 13th UN Congress on Crime Prevention and Criminal Justice 11-12 February Offshore Specialised and Construction Vessels Summit
23-25 April Arab Diabetes Medical Conference
17-18 February World Innovation Summit for Health (WISH)
May 4-7 May Project Qatar
16-22 February USA Week Qatar
March 10-11 March Qatar Projects Conference 16 | The Edge
18-21 May 1st Doha International Gift Exhibition 18-21 May World Stadium Congress
22-25 February Facade Design and Engineering Middle East 26-27 February IGN Gaming and Comic Convention
18-21 May World Stadium Congress
18-22 May FM Expo Middle East Summit
4-7 May Qatar Stonetech 4-7 May Heavy Max Machinery Exhibition
June 7-10 June Underground Infrastructure and Deep Foundations Qatar
qatar perspectives Qatar Rail to create a long-term sustainable alternative to road transport Qatar has been a destination and a second home for diverse and multicultural individuals. It is one of the few countries that has been able to translate its dreams into reality and Qatar Rail has been at the heart of such progress writes Eng. Saad Ahmad Al Muhannadi.
The main focus of Qatar Rail was, and remains, to secure the progressive future of residents and countrymen.
A significant proportion of Qatar’s infrastructure investment is currently focused on the development of a modern rail network via the Qatar Rail Development Programme (QRDP), consisting of a two-phase metro network, a Light Rail Transit (LRT) system and a Long Distance Passenger and Freight Rail network. All of these will be environmentally friendly and technologically advanced, and will meet the demands of the rapidly expanding population of Qatar. All three projects – Doha Metro, LRT, Long Distance Passenger and Freight Rail network – are built with the aim of providing customercentric, integrated railway services. These networks will be accessible, efficient, competitive, comfortable, safe, and reliable while maximising social and economic benefits. In 2011, when Qatar Rail was established, its project was set to form a fundamental and integral element of the National Development Strategy 20112016, and to act as a catalyst in realising Qatar National Vision 2030. So far, the company has awarded billions of dollars in contracts, with the aim of delivering one of the most sophisticated rail networks in the Middle East region. As the country’s leadership was setting the national goals for its future development, the company was also building its aspiration to turn Qatar into a better and more advanced state. We were not looking for short-term results, but
for a futuristic vision, enabling the next generation to have more road safety and reducing traffic as our country expands and grows. The main focus was, and remains, to secure the progressive future of residents and countrymen. What mattered was the conviction that moving forward Qatar Rail would indeed achieve a quantum leap in the country and create a heritage for the future generation. The corporate mission focuses on convenience, comfort, luxury and the welfare of the Qatari community as well as the residents, and we dreamed of being the favoured mode of transport for all. As all the employees work hard to provide an integrated railway service that is reliable, attractive and safe with continual commitment to excellence and sustainability, the company is confident that by the time the projects are completed, Qatar’s residents would remember the company as a changing force in society. Qatar Rail has been engaged with a variety of contractors, local and international companies and government agencies for the purpose of benefitting from global best practices, bringing together the leading providers. Throughout the past three years, Qatar Rail has been a busy hub for ideas, innovation, contracts, workshops, conferences, and in the process, have acquired a lot and embarked on different challenges, but with the dream intact to
18 | The Edge
ensure the highest standards of safety and convenience for the future users of Qatar Rail’s network. The company’s aim is to provide a longterm sustainable transport alternative to road transport, improve the environment and reduce traffic congestion, allowing multi-modal interchange with all the planned systems and develop highquality park and ride facilities linking key trip generators across the country.
Eng. Saad Ahmad Al Muhannadi is the CEO of Qatar Rail.
qatar perspectives Why finance is no longer a staff function Finance professionals are increasingly gaining more importance within organisations and are perceived as key decision makers, which renders popular perception of accountants as middle-aged, glassy eyed, hunched over a bunch of balance sheets engrossed in some serious number crunching - out of date, write Geetu Ahuja, and Ewan Cameron.
As the roles progress from accounting operations to management support, the amount of value added to the organisation generally increases.
Traditionally, accountants kept the books and ensured that statutory requirements were met. They were clearly a staff as opposed to a line function. Even as the role became more complex with innovative organisational models, a proliferation of regulations, and a glut of new financial instruments, the focus on the books remained. Or so has been the perception. This picture has indeed been changing over the past decades. Prodded by a rush of mergers and acquisitions and financial restructuring, organisations recognised the extra value financial professionals could offer in strategic decisions, risk analysis and other essential areas. The global economic crisis has hastened this change by focusing attention on the need for corporations to bring in more professionals who understand risk and finance into high-level strategic conversations. As an example of the overall shift, today more than ever before, a chief financial officer (CFO) is more likely to take the corporate reins than a chief executive officer (CEO). As the roles progress from accounting operations to management support, the amount of value added to the organisation and the contribution made by management accountants generally increases. In 2010, the Chartered Institute of Management Accountants (CIMA) and the University of Bath conducted a study which showed that financial professionals around the world were embracing the increased responsibilities that came with a more strategic role. Generally, they viewed
this shift as necessary for both career progression and personal job satisfaction. Closer to home, traditionally the majority of the accounting professionals were inclined to stay in an organisation for a long time. For example, in Qatar, the Kafala system restricts movement of talent out of ‘traditionally-run’ local companies, leading to a low employee turnover within the finance function. While it serves the purpose of job continuity, it also restricts the development of new opportunities in their career span or requires them to study for an additional accounting qualification. However, in recent times there has been a shift wherein huge emphasis is being laid on workplace performance and its role as a key driver to corporate success. In Qatar, many international companies, for example, the likes of HSBC, audit firms or international consulting firms have now set up globally accepted standards in place to drive employee performance. Today, across the Gulf Cooperation Council (GCC), financial professionals are dividing their time among a variety of responsibilities. Management accounting (forecasting, budgeting, cash flow management and other responsibilities) and accounting operations (traditional tasks such as internal financial reports and transaction processing) together account for almost half the time spent by them on the job. This transformation, brought about largely by the financial crisis, only goes to underscore that there remains significant pressure for financial professionals to
20 | The Edge
move into roles that add more value to their organisations and broaden their responsibilities beyond traditional accounting tasks. Keeping the numbers in order no longer spans the entire extent of an accountant’s reach. As the global crisis has shown with no uncertainty, major corporations need financial professionals who understand risk management, cash flow, financial instruments and other complex functions and can offer strategic guidance to top executives and, indeed, to enter boardrooms as peers. The profession is continuing to evolve in that direction, albeit with regional nuances. Those who continue to embrace old skills exclusively will likely be left behind. Those who embrace their expanding roles and responsibilities with competence and integrity will be in demand. But as they become ever more closely connected with the business, they must also ensure to not become subservient to it.
Geetu Ahuja is the head of GCC, CIMA and Ewan Cameron is the CFO of Mannai Corporation in Qatar.
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Contents: Commercial and retail banking in focus with infrastructure financing. 25. Al Dhameen: Ensuring financial stability of new businesses. 26
finance & markets Grand Hamad Street, popularly known as Bank Street, houses many banks. The International Monetary Fund Board, in their consultation with Qatar last year observed that banks remain well capitalised, liquid, and profitable. (Image Arabian Eye/Reuters)
Banks in Qatar follow a holistic growth model while maintaining a dedicated teams approach to financing different asset classes. Speaking with The Edge, banking experts focus on the business drivers of banks in Qatar. by Aparajita Mukherjee
T
he outlook for Qatar’s banking system has been stable, according to Moody’s Investors Service, in a report Banking System Outlook: Qatar published last year. The outlook reflected Moody’s expectation that Qatar’s strong economic environment will continue to sustain banks’ robust financial metrics – primarily strong earnings, sound capital buffers and low levels of non-performing loans (NPLs). However, the rating agency also said that these strengths would remain moderated by risks associated with Qatar’s reliance on the hydrocarbon sector, the banks’ relatively high dependence on shortterm foreign funding and the country’s stilldeveloping corporate-governance and riskmanagement culture. Last year also saw Standard & Poor’s
Commercial and retail banking in focus with infrastructure financing Rating Services affirming Qatar’s sovereign rating ‘AA/A-1+’. The rating rationale explained that this rating, which indicated a stable outlook, “reflects our view that Qatar’s economic wealth and strong external and fiscal positions balance its institutional shortcomings and limited monetary flexibility over the next two years”. One concern that has consistently been aired by leading economists was rising inflation which was expected to further escalate. Overall, headline inflation was forecast to increase by 3.4 percent year on year (yoy) and 3.8 percent yoy on average in 2014 and 2015, respectively. Given this perspective The Edge spoke to leading financial experts on their take of what constitutes the banking business drivers, on infrastructure finance and the
future of corporate finance in the face of infrastructure finance gaining momentum.
Business drivers
Commenting on the main business drivers of Ahli Bank, Sheikh Faisal Bin Abdul Aziz Bin Jasem Al Thani, its chairman and managing director said, “We offer a comprehensive commercial banking services to the business community, retail services to the public, and private banking to high net worth VIPs. These services are the pillars of the bank’s activities.” Robin Butteriss, head of financial advisory, Deloitte, Qatar was of the opinion that Qatar’s domestic banking arena has experienced a step change over the last 15 years. He added, “Growth in domestic banking was historically driven by the nonThe Edge | 25
sectors | finance & markets
QAR
771.7 billion
Proposed infrastructure expenditure in Qatar in the next seven years.
hydrocarbon sectors but, with billions of dollars being spent on Qatar’s infrastructure requirements more recently, infrastructure projects are expected to remain the main driver of banking business in Qatar for the next few years. Infrastructure projects currently underway and planned in the future are expected to provide sufficient credit opportunities for banks with most of the facilities being provided by conventional banks. However, given Basel III and the increased pressure on risk mitigation, a key challenge for local banks would be around diversifying their credit portfolios and have fairly considered exposure limits in place.”
We offer comprehensive commercial banking services to the business community, retail services to the public, and private banking to high net worth VIPs.” – Sheikh Faisal Bin Abdul Aziz Bin Jasem Al Thani, Ahli Bank chairman and managing director. SME finance
Al Dhameen: Ensuring financial stability of new businesses Starting one’s own business is a complex process. There is a lot of merit to a great idea of a product or service that will change someone’s life for the better but the key to success lies in the initial financial support that will cement the sustainability of a new business writes Jawaher Humaid Al Noaimi. The same goes for small and medium enterprises (SMEs), which do not have a steady previous credit history. In its effort to support economy diversification, Qatar Development Bank (QDB) has established Al Dhameen to support startups and SMEs lacking credit history or having insufficient 26 | The Edge
collaterals to obtain commercial credit approval. Al Dhameen does not provide direct financing to SMEs, but rather offers business owners a facility to receive the required financing for a project from a partner bank, through issuing guarantees in favour of that bank. Under the guarantees, Al Dhameen vouches for 85 percent of the loan value not exceeding QAR15 million. So far, Al Dhameen has approved guarantees worth over QAR500 million to SMEs through nine Al Dhameen partner banks. In 2014 alone, Al Dhameen guaranteed over 69 clients with a total value of QAR168 million. By providing financial guarantees for these projects, QDB seeks to promote the entrepreneurial spirit of
Sheikh Faisal Faisal Bin Abdul Aziz Bin Jasem Al Thani, chairman and managing director, Ahli Bank said that their infrastructure financing is directed towards strategic projects, with selected customers.
Infrastructure finance
Late 2014, Wall Street Journal has reported that Qatar plans to spend USD212 billion (QAR771.7 billion) in the next seven years to build the football stadiums but also a rail network, metro line, housing and even a new city. This has opened up a huge portfolio for banks. Commenting on the extent this will help the banks, Butteriss of Deloitte Qatar said maintaining liquidity and an adequate Capital Adequacy Ratio (CAR) were of fundamental importance to banks. “The influx of large infrastructure projects in Qatar will have a direct impact on liquidity and CAR for domestic banks, which are looking to finance these projects,” mentioned Butteriss. The challenge for Qatar, according to Butteriss, would be to help provide an environment where foreign banks would feel comfortable in extending further facilities for infrastructure projects in Qatar.
the private sector and offer services that will facilitate the development, growth and diversity of the national economy. In line of the programme, QDB held many workshops for enterprise owners to get them familiar with available investment opportunities in the SME sector. The bank also organised training programmes targeting customer relationships managers in partner banks, in order to enhance their skills in credit and project evaluation.
Jawaher Humaid Al Noaimi programme manager, Al Dhameen, QDB.
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Contents: Qatar leverages contractual advantages. 27. SMEs in oil and gas. 28
energy & sustainability RasGas carrier Mekaines is one of many transporting LNG cargoes to Qatar’s Asian markets. Many are fixed price long-term contracts, a strategy that is proving a strong buffer for the country against the effects of the present depressed oil price (Image RasGas).
In for the long haul
As low oil prices affect producers, Qatar should leverage contractual advantages Up until very recently, as the Brent oil price slipped down through the key USD90 (QAR328) per barrel (pb) level, Qatar’s position as the global liquefied natural gas (LNG) swing producer was under threat. But in direct contrast to its neighbours in the Middle East and to the vast majority of hydrocarbons-centric economies elsewhere around the globe, the decline of world oil prices has yielded more positives for Qatar than negatives, argues Simon Watkins
H
oward Rogers, director of the Natural Gas Research Programme for the Oxford Institute for Energy Studies in Oxford in the United Kingdom, explained to The Edge that given Qatar’s ongoing strategy involving the careful placement of its LNG output over an increasingly wide geographical spread (and through differing contract/price formation channels), the country is set to benefit even as many of its global competitors struggle. The most recent illustration of this strategy in action was the landmark first delivery of LNG to Thailand’s Map Ta Phut LNG terminal under a long-term Sale and Purchase Agreement (SPA) between
Qatargas 3 and Thailand’s energy giant, PTT. Indeed, Qatargas delivered the first commissioning cargo to Map Ta Phut (Thailand’s inaugural, and only, LNG receiving terminal) as early as 2011. Since then it has supplied 27 spot cargoes to PTT, making Qatargas by far its major supplier. The SPA contract, signed in December 2012, stipulated the delivery of two million tonnes per annum of LNG for a period of 20 years beginning from 2015. It was Qatargas’ first such agreement in South-East Asia. Such agreements lie at the core of Qatar’s insulation against the worst effects of the ongoing downturn in the global The Edge | 27
sectors | energy & sustainability
Global Oil and Gas Projects Outlook Estimated reserves, by year of FID in million BOE (barrels of oil equivalent) per day Final Investment Decisions (FID) on major projects can determine the future profile of major international oil companies.
100.000 80.000 60.000
Onshore projects
40.000 20.000
2019
2018
2017
2016
2015
2014
2013
2012
2011
Offshore projects 2010
0
Source: Ucube by Rystad Energy
hydrocarbons’ pricing complex, added Rogers. “Volumes were placed under long-term crude oil price-indexed contracts with Asian buyers, through oil and oil product-linked priced long-term contracts with Southern European buyers, and via medium-term contracts,” he said. “Re-gas infrastructure investment enabled spot delivery to US and Northern European buyers and, from the outset, it was clear that volumes of LNG which were not subject to long-term contracts could be redirected and sold as spot or under short-term deals, under a dynamically managed sales strategy.” This long-term pricing structure has given incumbent leading supplier Qatar an advantage over competitors in the next few years, most notably Australia and shale resources from North America. Overall, according to data from Norwegian consultancy Rystad Energy, this year companies will likely make final investment decisions on a total of 800 oil and gas projects worth USD500 billion (QAR1820 billion) and totalling nearly 60 billion barrels of oil equivalent. But with analysts forecasting oil to average USD82.50 (QAR300)
The long-term pricing structure has given incumbent leading supplier Qatar an advantage over competitors in the next few years, most notably Australia and shale resources from North America. 28 | The Edge
pb this year, around one third of the spending, or a fifth of the volume, it is unlikely to be approved, said head of analysis at Rystad Energy, Per Magnus Nysveen, in Oslo. Australia was due to usurp Qatar’s number one global LNG supplier position by 2020, with at least 85 billion cubic metres per annum of new supply originally scheduled to come onstream between 2015 and 2018. However, with spot oil prices still unsupported by any prospect of a meaningful cut in output from Organization of Petroleum Exporting Countries (OPEC), benchmark Brent oil looks set to continue to trade below the level required for many Australian LNG firms to generate the 10 percent rate of return necessary for them to become viable. Similarly, the much-vaunted shale gas revolution emanating from North America looks shaky, with plans for significant US and Canadian LNG exports from the fourth quarter of this year (and growing exponentially from 2018 onwards), looking less than certain. Indeed, according to Rystad’s Nysveen, around one third of the projects scheduled for FID this year are ‘unconventional’ and, of those 20 billion barrels, a significant number are located in Canada’s oil sands. For example, French energy giant Total, recently decided to postpone the FID on the Joslyn project in Alberta, the cost of which industry sources estimate at USD11 billion (QAR40 billion). The share of the gas in the global energy mix over the next 20 years is projected to increase from around 22 percent to 25 or 26 percent. According to Gas Exporting Countries Forum (GECF) secretary general Seyed Mohamed Hossein Adeli, Qatar is in an unusually good market position. “[It] has demand from the East and recently from the West, and also has the policy of moratorium up to 2018, which, if they continue this policy of a ceiling on production, then with the increasing of demand, Qatar’s LNG prices will hold,” Adeli explained.
SMEs in oil and gas
New Pearl-GTL contracts underpin Qatar’s SME expansion strategy In keeping with Qatar’s strategy of increasing the role of domestic small- and medium-sized enterprises (SMEs) within its business mix, Qatar Development Bank (QDB) and Qatar Shell (QS) signed agreements with five Qatari SMEs to supply Pearl-GTL, the world’s largest gas-to-liquids (GTL) plant.
Mozon Industries will provide large open-head steel drums, KEPCO will provide low voltage cables and Pioneer Metal Company will provide electrical cable trays. Meanwhile, Prince’s Lights will maintain, repair and re-certify ATEX two-way radios, and Rumaillah Motors will service and maintain offshore diesel generators. “Our strategy is to accelerate the growth and development of Qatar’s private sector, and it’s through such joint initiatives that we are able to link local SMEs to world-class companies, such as Shell and Qatar Petroleum,” underlined Abdulaziz bin Nasser Al Khalifa, CEO of QDB. “Local SMEs grow and flourish by acquiring contracts
sector | energy & sustainability
that have the potential to elevate their futures, and global companies and their customers get the services they need from a local supplier, which reduces risk and provides quality assurance.” Indeed, the major problem for local SMEs seeking inclusion in such lucrative hydrocarbons projects in the Middle East remains the unwillingness of many governments to decentralise any control over the sector, which is correctly regarded as being of vital strategic importance to states around the world.As an adjunct to this, Yousif Saeed Lootah, executive director of Lootah Biofuels in Dubai said domestic banks are more reluctant to lend to SMEs. Exacerbated by the weak global economic climate, this is because contracts with the smaller firms will be cancelled first if problems in a project arise, or when – as at present – operating margins are squeezed by low oil prices. Thus Qatar’s positive moves, aimed at redressing this imbalance, have been welcomed. “The addition of five new Qatari SMEs to the three local suppliers which were announced last year is a clear demonstration to the successful partnership between Qatar Shell and QDB to bolster a robust private sector that will help diversify Qatar’s economy and support the Qatar National Vision 2030,” added Al Khalifa. “In support of our valued partner Qatar Petroleum and in close collaboration with QDB, we are committed to the Qatar National Vision 2030 by developing local content and SMEs,” said Wael Sawan, chairman and managing director of Shell Qatar. “As a result of this joint initiative, I am very proud to officially welcome five new Qatari small and medium enterprises into the Pearl GTL family; a family that I’m delighted to say has more and more local private sector members each year.”
“Local SMEs grow and flourish by acquiring contracts that have the potential to elevate their futures,” said Abdulaziz bin Nasser Al Khalifa, CEO of Qatar Development Bank of the Shell deals.
The Edge | 29
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Contents: Increased stock for Qatar’s hotels this year. 31. Banana Resort opens in Qatari waters. 32.
real estate & construction Established in 1982, Sheraton Doha Resort & Convention Hotel is one of the largest facilities in the country’s hospitality sector. (Image KCT Group)
Doha’s hospitality sector set for increased stock in 2015 With the reopening of the Sheraton Doha Hotel, Doha has regained 371 keys for its hospitality sector that otherwise showed slow growth in new stock in 2014. Experts forecast that 2015 will bring a large number of new keys to mark a growth rate of 25 percent by Q3 2015. by Farwa Zahra
D
oha’s hospitality sector has had its capacity replenished by 371 keys with the reopening of Sheraton Doha Resort & Convention Hotel, which closed in 2014 for renovation works. For the sector overall, as of Q3 2014, DTZ has identified 108 hotel and serviced apartment properties in Qatar, rated between two and five stars, providing a total of circa 16,700 keys. Within Doha, about 85 percent of keys are rated between four and five stars. While there had been “a temporary slowdown in new stock” in 2014, by the end of Q3 2015, “DTZ forecasts a large pipeline of supply and potential for hospitality stock to increase by 4000 keys or 25 percent.” While the renovations at the Sheraton included rework on all key facilities, it does not come with a new look of the project
either from inside or outside. With the idea to maintain Sheraton’s legacy for Doha’s cityscape, the renovation was rather aimed for restoration of Qatar’s 32-year-old hotel. Behind the renovation works was Khayyat Contracting and Trading (KCT), awarded the turnkey contract for the project. Speaking about the project, chief executive officer of KCT Group, Mohamad Moataz Al Khayyat, said that the refurbishment of the Sheraton Doha has been the most rewarding project to date. “This design build project,” he said, “was very challenging and drew on our full portfolio of companies” ranging from interior design, high-end joinery, marble works, aluminium works, facility management, logistics and supply of furniture and equipment to complete this substantial project in just seven months.
This design build project was very challenging and drew on our full portfolio of companies.” Mohamad Moataz Al Khayyat, CEO, KCT Group. The Edge | 31
sectors | real estate & construction
Mohamad Moataz Al Khayyat, CEO, KCT Group, says that the refurbishment of Sheraton Doha Resort & Convention Hotel has been one of the most rewarding projects to date.
Discussing a major challenge linked to the project, Al Khayyat said, “In order to reinstate the hotel and convention centre back to its former glory, we needed to gather information from all sources. This was a design build turnkey contract and very limited historical information was available at commencement.” Sharing details about the scope of this renovation project, Al Khayyat said that it included replacement and upgrade of all mechanical, electrical, plumbing and heating, ventilation and air-conditioning systems. Additionally, the external landscaped areas, beaches and pools were demolished and rebuilt to high standards. For the interiors, all previous furniture, flooring, wall finishes, kitchens, ceilings and lights were removed and replaced with those of better quality. To ensure the replacement did not digress from the original features of the hotel, structural repairs were complemented with architectural and interior finishing works.
Speaking about Qatar’s construction sector, Al Khayyat said, “Doha is in the midst of a construction boom owing to its preparations for the FIFA World Cup 2022, as well as projects being completed to accomplish the government’s vision of a progressive and sustainable city by 2030.” Speaking about some of Qatar’s projects in the pipeline, he mentioned Doha Metro and stadiums for the 2022 World Cup. “All these are attractive as they invariably will have a lasting impact on cityscape of Doha, and will be a big boost to its development in the years to come,” he added. Commenting on the relaunch of Sheraton Doha, Sheikh Nawaf bin Jassim bin Jabor Al Thani, chairman of Katara Hospitality, owners of the hotel, said, “[Sheraton Doha] served as the early focal point of West Bay, its distinctive pyramid profile a monument to the heritage and future of Qatar. Newly restored to its original grandeur, Sheraton Doha once again serves as a symbol of the growth and development that have made Doha what it is today.”
real estate & construction
Qatar unveils its latest luxury resort Anantara’s Banana Island Resort opens in Gulf waters just off Doha View from a two-bedroom overwater villa at Banana Island Resort. (Image Anantara)
141
The number of rooms in Banana Island Resort.
32 | The Edge
Banana Island Resort, located on a crescent-shaped island near Doha, is the latest addition to Qatar’s otherwise limited list of resorts. Opening doors for the public, the facility was inaugurated by HE Sheikh Abdullah bin Nasser Al Thani, Prime Minister of the State of Qatar and the Minister of Interior. Featuring 141 luxury guest rooms, suites and villas, the interior reflects Arabian art while the exterior seems mostly inspired by Maldivian-style resorts with beach and ocean villas. Water sports facilities available at the resort include kayaking, pedalos and stand-up paddleboarding, wakeboarding, banana boating, triple tube, donut rides, water skiing and jet skiing, as well as luxury yacht cruises and fishing trips. Other recreational facilities include tennis, beach volleyball and a fitness centre. Now open for customers, the resort will add more variety to Qatar’s architectural legacy, reflecting not only Arabian styles but also Venetian architecture such as that of the Pearl-Qatar.
sector name | banner heading
Contents: Effective use of business analytics. 33. Qatar social media usage by nationality. 34.
tech & communications
The business of analytics Addressing critical issues within data collection
IT investment in the Middle East has led to a massive enterprise infrastructure sprawl. This has been accompanied by spending on applications aimed at streamlining business processes and, crucially, the digitisation of information. The inevitable by-product of all this has been increased complexities around IT management as, organisations across the region are now generating huge amounts of data. by Jyoti Lalchandani
N
early 69 percent of all Middle East chief information officers (CIOs) expect data growth to be between 20 to 30 percent over the next 12 months, the majority of it largely unstructured. Making sense of this massive amount of data and using this information to improve decision-making, inform strategy, and drive competitive advantage is becoming increasingly critical for organisations, and this has led to growing interest in business analytics investments across the region. Middle East CIOs ranked business analytics as the third most important transformation technology for their
organisations in 2014. Business analytics is defined as software tools and application markets, with the functionality to aggregate, manage, organise, analyse, access, and deliver structured and unstructured data; this includes business intelligence tools, performance management and analytics applications and data warehousing platforms. Many business applications now come with embedded analytics so as to provide reports on the data that is being captured or generated. And while there is a wide range of solutions available in the market, there are a number of aspects that CIOs must address
3
rd
Middle East chief information officers ranked business analytics as the third most important transformation technology for their organisations in 2014.
if they are to ensure a successful and, more importantly, useful business analytics deployment within their companies. The Edge | 33
sectors | technology & communications
The business aspect
When it comes to implementing business analytics solutions, it is not simply a case of IT deploying the solution and expecting the organisation to use it to aid decision making; executive buy-in is required from senior management. This will help develop a clear picture of how the technology can be leveraged to gain better and faster insights in a timely manner. Once this buyin has been secured it is important to gain support from the various lines of business (LoB) across the organisation. While the executive board may seek financial metrics, the LoB managers will be more interested in how they can leverage the data that is most relevant to their particular teams. Gaining this LoB backing is crucial as it will help justify the business use case and budget, and we have even seen examples of organisations where LoB heads brought up the issue of business analytics even before IT. Marketing departments, for example, are interested in customer analytics in order to help improve their product/service positioning. Another important step is to secure agreement on the key performance indicators (KPIs). IT needs to work with the business heads to define the relevant KPIs, and this should be done from the time of project initiation so as to ensure that the correct data is being filtered out and recycled for reporting purposes. Given the amount of unstructured data floating around organisations, ad hoc requests are inevitable, but it will always be more efficient to have the relevant stakeholders define a set of KPIs so that the right data streams can be leveraged. The aspect that can really decide whether a business analytics solution will be successful or not is change management. Once the KPIs have been agreed upon and the project is about to go live, IT and business functions need to work together to ensure that the organisation is ready to adopt the changes they are about to experience. Educating users on how to use the data and
In business analytics, data quality is a critical factor. 34 | The Edge
reports is critical, and some employees will inevitably need a certain amount of basic skills training. They will also need to agree with the fact that decision making within the organisation is about to change.
The technology aspect
When implementing business analytics, data quality is a critical factor that can impact the type of value the organisation will ultimately see. Resolving data quality is crucial given that various systems may be capturing data differently; there may be multiple iterations of the data, and IT may not know all the factors that are being taken into account while creating Excel reports. IT heads will have to work closely with business leaders to better understand this aspect. IT will also need to work with business on the issue of data governance – defining data assets, standardising the way data is captured, and determining exactly what data can and cannot be accessed. There needs to be cross-functional ownership of this data, with all stakeholders working together to ensure the governance framework is managed effectively. This goes hand in hand with the issue of data security, as business analytics solutions gain access to a wide variety of data right across the organisation. It is therefore important that the data being accessed is secure and that any relevant security guidelines and legislation are
adhered to at all times. The biggest technology aspect that IT needs to address is data integration, ensuring that data is being properly integrated into the relevant business analytics systems given the various application silos in existence across the organisation. It is also important to keep in mind that not all data is created equal and that certain applications may create more data volume than others. The one aspect that is common to both business and IT? Finding the required skills for new technologies. This is a persistent challenge across the Middle East, and companies need to either invest heavily in training or seek to ensure that the majority of their business analytics processes are automated.
Jyoti Lalchandani is group vice president and regional managing director for the Middle East, Africa, and Turkey at International Data Corporation (IDC).
Social Media Usage in Qatar by Nationality Arab expatriates
Qataris 97% 92% 82%
Non-Arab expatriates
89% 78% 65%
44%
48% 46% 39% 38% 27% 30% 26%
34% 33%
13% 10% WhatsApp
BBM
Snapchat
Source: Usage of social channels by nationality in Qatar - ictQatar in Soclal Media in the Middle East: The Story of 2014 - Damian Radcliffe.
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[ Special Coverage: Paris 7.1.2015 ]
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CHARLIE? In the aftermath of the French terrorist attacks in January there has been much debate regarding freedom of speech and the rise of Islamist terrorism, as well as bigotry from the most outspoken on the far ends of the philosophical spectrum, particularly in Europe and the United States. It is also yet another chapter in an eons-old narrative ostensibly pitting East against West and the Islamic world against the Christian. But what about the voices of Moderate Muslims, Are they being drowned out by bigoted rhetoric or are they simply not shouting loud enough regarding the virtues of Islam? So asks The Edge special correspondent Yadullah Ijtehadi, who offers his own opinion on the matter.
Condemnation for the Charlie Hebdo attacks in France in January was swift, and all over Europe peaceful demonstrations, such as this one in Spain, were held by Muslim groups to show solidarity with the people of France. (Image Arabian Eye/Corbis)
82-97%
The estimated percentage of victims of global Islamist terrorism that are Muslim, according to the United States National Counterterrorism Center. The Edge | 37
sector name | banner heading
T
he horrific slaying of Charlie Hebdo journalists by radicalised individuals has once again, for some on the far right at least, held up the faith of Islam against Western civilisation. For such ignorant commentators, nuance is absent, as the entire Muslim ‘Ummah’ is being called on by a segment of these people to take responsibility for the attacks, at least in some indirect way. But long before the ill-informed talking heads of cable news channels and bigoted writers of the tabloid newspapers began to spout their ignorance, the condemnation of the horrific attack had already been swift in the Islamic world. Reasonable Muslims – and there are more than 1.5 billion at the very least – understand that nobody should be killed for their opinions, no matter how distasteful. Many governments in the Arab World were also quick to condemn the attacks (see box out), and many Muslims even embraced the slogan “#IamCharlie” on social media to show solidarity with the slain cartoonists and journalists. While that could be construed by some a case of overcompensation, there is a slow and painful realisation within the Muslim world that every time a deranged group of individuals attacks the West in the name of Islam, the rift between Muslims and the Western world widens just a little bit more.
Reasonable Muslims understand that nobody should be killed for their opinions, no matter how distasteful.
Mourners paid candlelit tribute to the slain Charlie Hebdo victims at Place de la Republique, Paris. (Image Arabian Eye/Corbis)
Lassana Bathily of Mali risked his own life to help save others during the later terror attack at the Hyper Casher Jewish grocery store in Paris and in doing so became a national hero and an inadvertent spokesman for all positive about Islam. He was awarded French citizenship for his actions. (Image Arabian Eye/Corbis)
38 | The Edge
The increase of anti-Muslim and antiimmigrant sentiment in Europe and the US seems to be evidence of that (though, granted much of this is secular in nature and not always aimed at Muslims). It is not fair, of course. But in the modern world, that is the hand Muslims have been dealt. Muslims can choose to stiffen up and get defensive, but furrowed brows are not going to help the cause. Only a confident, moderate Muslim voice can condemn Charlie Hebdo journalists’ killers, but in the same breath rail at hypocrisy in the form of Israeli Prime Minister Benjamin Nethanyahu attending a “peace rally” after decimating Gaza last year. Lost in this photo-opportunity for
leaders is the dire need to move away from the cliché of an epic East-and-West clash. Some Western leaders may have tried to explain away the attacks as nothing more than hatred for “our freedoms, our democracies”. For a small few on the far right, ‘They’ are of course radicalised Muslims, but the subtext is that this feeling is shared and supported by the wider Islamic world. That is, obviously, completely false. Many Muslim immigrants live and thrive in Western countries and most Muslim governments often see European nations as models for growth, social equality and economic freedoms. For its part, the European Union needs immigrants to sustain its workforce and economic growth, so xenophobic tendencies are, in fact, self-inflicted wounds. It could of course easily be framed in the context of centuries of conflict between East and West dating back to the Crusades. As such, most people in the modern Western world don’t buy into the narrative of an inevitable East-and-West showdown or
cover story | c’est qui #charlie?
Select quotes from leaders in the West and Muslim world decrying the attacks in France in January 2015
some epic clash of cultures. The lacklustre response to anti-Muslim protests in Germany and the more than 100,000 social media references to #Illridewithyou hashtags that emerged in Australia to show solidarity with Muslims after a fundamentalist that held a café under siege in Sydney, show most people in the West understand Islam is not to blame. There are many more examples of kind gestures traded between Muslims and their hosts taking place daily that remain unor underreported. Also lost in the hysteria is Islam’s centuries-old legacy of critical thinking and philosophy and its peaceful co-existence with other religions throughout its history.
A landscape of social and economic injustices, illiteracy and repression is a happy hunting ground for the dark masters of extremism.
The UOIF condemns, in the strongest possible terms, this criminal attack and these horrible murders and offers its condolences to the families as well as the employees of Charlie Hebdo.” - Union des Organizations Islamiques de France (UOIF), an entity representing more than 250 French Muslim organisations. Contrary to what was apparently said by the killers in the bombing of Charlie Hebdo’s headquarters, it is not the Prophet who was avenged, it is our religion, our values and Islamic principles that have been betrayed and tainted.” - Dr. Tariq Ramadan, Professor of Contemporary Islamic Studies at Oxford University. Such acts against defenseless civilians contradict with all moral principles and human values. The ministry extended condolences and sympathy to the French government and the families of the victims, wishing speedy recovery to the injured. Statement by the Qatar Foreign Ministry. Nothing justifies the taking of life. Those who have killed in the name of our religion today claim to be avenging the insults made against Prophet Muhammad, upon whom be peace. But nothing is more immoral, offensive and insulting against our beloved Prophet than such a callous act of murder...while Muslims must engage with fellow citizens in a spirit of dialogue and friendship, we must all come together to seek unity and defy the terrorists whose only aim is to divide us. The best defence against closed minds is for a truly open society, welcoming of all.” - Dr. Shuja Shafi, Secretary General of the Muslim Council of Britain. Malaysia condemns in the strongest terms all acts of violence. We stand in unity with the French people. We must fight extremism with moderation.” Malaysian Prime Minister, Najib Razak.
The Edge | 39
sector name | banner heading
Long before Europe came out of the dark ages, the vibrant cities of Baghdad, Alexandria and Damascus of the past were models of peaceful co-existence, with Muslims and people of other faiths living peacefully as neighbours for centuries. The modern-day equivalents of those great cities, Doha, Dubai and Abu Dhabi, once again underline the desire of many modern Muslim states to develop inclusive, creative hubs of business and trade.
Blame game
So, where did things go wrong? To be sure, the West has played a significant role in sowing the seeds of discontent, by waging wars in the Arab world and supporting dictatorial regimes in the region for decades that have offered little to their citizens despite ample resources. Lukewarm or selective support for the failed Arab Spring by European and American governments has added to many Muslims’ disillusionment towards Western leaders. And while Europe has preached the virtues of social and economic freedoms to Arabs and Muslims, it could in some respects do better to integrate disenfranchised immigrants who landed on the continent seeking a better quality of life, quell antiMuslim and immigrant extremism and promote religious tolerance. Yet, despite the shortcomings of everyone involved, much of the major effort of reformation needs to happen within the Islamic world itself. If one is looking to point fingers, there is plenty of blame within. Around 100 million Arabs are uneducated (nearly 20 percent of the population), while youth unemployment stands at 23.2 percent in the region, compared to the global average of 13.9 percent. That figure exceeds 60 percent in some parts of the Muslim world. These statistics alone explain that much needs to change in the way citizens are looked after in these countries. The landscape of social and economic injustices, illiteracy and repression is a happy hunting ground for the dark masters of extremism to prey on disillusioned young men. Meanwhile, the moderate Muslim has been flailing as extremists from both sides of the divide dominate the pulpit. Between the hideous and nihilistic Al-Qaeda, ISIS and Boko Haram and the fringes of the far right in the West, moderate Muslims cannot get a word in edgewise in this heated debate. 40 | The Edge
Doha, Dubai and Abu Dhabi underline the desire of many modern Muslim states to develop hubs of business and trade. As everyday Muslims have fumbled for the right response, more airtime is given to fascists and hatemongers, as thanks to the media hunger for more readers and clicks, they court more controversy. While moderate Muslims have often kept to themselves, expressing their opinions only in private conversations and not in public forums, others have openly distanced themselves from extremists because they have felt it was expected of them. Meanwhile, radical secular hardliners in the Middle East have waged a full-scale war, openly attacking, killing, maiming and terrorising extremist Islamists with selfacclaimed justification. Arguably hardliners have had all the successes, and pushed moderates out of the limelight and conversation. This fear of upsetting the faithful furious has paralysed governments and civil society, and turned average Muslims into the biggest victims of terrorism. Moderates have already ceded ground
German Muslim leaders and editors of some of Germany’s biggest circulating newspapers gather outside the head office Axel-Springer of one of Europe’s largest publishers, calling for a peaceful coexistence and press freedom, in response to the Charlie Hebdo attack in France. (Image Arabian Eye/Corbis)
to hardline groups in places such as Syria, Yemen, Libya, Sudan and Afghanistan, while Iraq, Mali and Pakistan are teetering on the edge. As the regional landscape becomes unrecognisable in front of their eyes, some Muslim governments have slowly realised that the West’s ‘War on Terror’ is in fact their fight. Once the Taliban were the biggest menace, now Al Qaeda, ISIS, Boko Haram, the Nusra Front and Haqqani Network are just some of the fearsome forces patrolling the streets of Muslim countries. There is now a dire need for moderate Muslims and their governments to wrestle back the ‘Islamic terrorism’ narrative both from the extremists and the Western governments, and confront the issue themselves.
Positive examples
The concerted efforts of Saudis, Qataris and the Iranians against ISIS, UAE-Egyptian action against Libyan fundamentalists, and the Pakistani army’s latest campaigns in its northwest after 132 school children were massacred in December 2014, are all signs that governments are slowly getting the message that they have to deal with
Following the January terrorist attacks, a sharp spike in xenophobic revenge attacks on French Muslims and institutions prompted the French authorities to offer the community additional protection, and the country pledged an additional EUR 400 million (QAR1.6 billion) on domestic security. Here a French paratrooper stands guard in front of the Great Mosque of Lyon during Friday prayers. (Image Arabian Eye/Corbis)
cover story | c’est qui #charlie?
a problem within their own boundaries. Indeed, Qatar has been vocal in condemning the attacks and has been has supporting ongoing attacks on ISIS, alongside Arab and Western allies. Also heartening is the fact that there are some green-shoots of the ‘silent majority’ of Muslims finally raising their voices – not to apologise for the actions of their co-religionists but to reclaim the religion that has been hijacked by anarchists. For example, British comedian Humza Arshad made a short film aimed at teenagers extolling the dangers of extremism and regularly approaches the topic in his repertoire. Then there is Mohamed Jibran, a lawyer and activist from Pakistan who has initiated a grassroots campaign against hardline extremists in his own country. Using social media effectively, the 27-year-old has captured the imagination of Pakistanis who have been terrorised by intolerant extremists who dictate their daily lives and operate with impunity in the country. His slogans of #reclaimyourmosques and #reclaimyourreligion resonate with most modern Muslims who are tired of the tyranny. Tunisia’s resolve to compromise between Islamic and secular parties is also bursting with promise amid the gloom. The economic growth and increasing success of secular-leaning states such as Indonesia, the world’s most populated Muslim country, as well as their vocal condemnation of the Charlie Hebdo attacks, is another positive. But at the moment these examples are overshadowed by the of successes of extremist cells in Africa, Asia and Europe, whose every act pushes Muslims further into the abyss, and justifies Islamophobia in the West. It is clear that the West needs to address its xenophobia and bigotry towards Muslims. But it is also incumbent on Muslims to find innovative ways to demonstrate the softer side of Islam and engage with moderates in the West, the vast majority of whom support or are ambivalent towards Muslims. If this does not happen, the hardliners will continue to call the shots. Yadullah Ijtehadi currently works as the energy editor at The National Post, part of the largest newspaper chain in Canada. He spent more than a decade in Dubai where he held numerous senior editorial positions, including managing editor of Zawya.com and editor of Gulf Business magazine.
In theory we can say a violent reaction to an offence or provocation isn’t a good thing, that one shouldn’t do it. In theory we can say what Gospel says, that we should turn the other cheek. In theory we can say that we have the freedom to express ourselves...But we are human. And there is prudence, which is a virtue of human coexistence. I cannot insult or provoke someone continually because I risk making him angry.” - Pope Francis, head of the Catholic Church. France, and the great city of Paris where this outrageous attack took place, offer the world a timeless example that will endure well beyond the hateful vision of these killers.” - US President Barack Obama.
By the numbers
100,000
The amount of social media references to the #illridewithyou hashtag for a Muslim woman scared to ride on a bus in Australia, following an attack in a coffee shop in Sydney.
25,000
The number of attendees at a PEGIDA antiMuslim rally in Dresden, Germany, following the Charlie Hebdo attacks.
7,000 The number of people against the same rally in Dresden.
20,000 The number of people protesting against PEGIDA in Munich
19,000 The number of people protesting against PEGIDA in Hanover
30,000 The number of people protesting against PEGIDA
in Liepzig.
72%
The number of people with a favourable view of Muslims in France, the highest percentage of surveyed countries in Europe (in the country with the largest Muslim population).
34 million
The number of tweets worldwide with the #jesuischarlie hashtag in the 24 hours following the attacks.
The Edge | 41
Water and energy conservation are key priorities for Qatar when developing a green building. According to QGBC’s director, Meshal Al Shamari, in Qatar, the biggest consumer of energy is heating, ventilation and airconditioning systems.
Supporting Qatar’s
sustainability
agenda An interview with Engineer Meshal Al Shamari, director, Qatar Green Building Council
Qatar’s representative for World Green Building Council, Qatar Green Building Council (QGBC) is driving the country’s sustainability agenda. With a network of 70 volunteers and a library on green buildings, the nonprofit organisation regularly arranges workshops to raise awareness among various interest groups on energy, facility management, water, green infrastructure, green hotels, green education, healthy buildings and solid waste. In late 2014, the organisation announced the launch of Qatar’s first green building directory, while its work on Qatar’s Green Economy roadmap is underway. In an interview with QGBC’s director, engineer Meshal Al Shamari, Farwa Zahra explores Qatar’s current position on sustainable development, and QGBC’s ongoing and upcoming projects to support the nation’s green agenda.
business interview | green buildings
How do you see the progress of sustainability in Qatar? The sustainability and green building concept in Qatar began approximately in 2006, with Msheireb Properties’ project, followed by many developments by Qatar Foundation. The concept was still new not only to Qatar but to the whole region as well. After about three to four years, the concept increased dramatically. In 2010, the preparation of the Qatar Sustainability Assessment System (QSAS) started. Then in Qatar’s construction code, which is Qatar Construction Specifications’ version 2010, a part about the green buildings and sustainability was included for the first time. It was then an optional clause in the construction code. After that, the government started supporting green developments. So, from 2006 until 2010, there were some initiatives, but after 2010, there was increase in terms of government support, regulations, and the interest of developers towards green buildings. After 2012, we started having many projects in Qatar with green certifications; we also started having the rating systems stronger in Qatar, along with the government support. [As of 2014], we have more than 200 green buildings that are Leadership in Energy and Environmental Design (LEED) registered. Could you give more details about these buildings? We have 50 completed and certified buildings, 100 with Msheireb Properties almost at completion. We have many developments in Qatar Foundation. Then we also have in Lusail City [and] governmental projects and private projects, registered with Global Sustainability Assessment System (GSAS), which is
the local rating system, while LEED is the American system. [Thus] we have a combination of both rating systems in many projects. So as a journey towards sustainability, we are doing very well. Actually in Qatar, in terms of the number of buildings, we are the second highest in the Middle East and North Africa region. The number is further increasing; all Ashghal projects now will be GSAS or green buildings certified projects. So I think, in two years time, we will have mandatory regulations that will for sure increase the number of projects. The optional period will give a chance to the companies and developers to prepare themselves to enter that market because sooner or later it will be mandatory and they have to do it in the end. So it is better if everybody prepares during these two years to be ready for the next move. How is GSAS different from LEED? How does GSAS stand internationally? As a concept they are the same. LEED is using ASHRAE codes most while GSAS has selected many references or codes which are more suitable to Qatar. So, they are different methodologies, but in the end, the aim is the same. GSAS started from Qatar as QSAS, then it changed to GSAS. GSAS is now well known in the
200
The approximate number of LEED-registered green buildings in Qatar.
Passivhaus, an ongoing project of QGBC in Doha, is a dwelling that depends on passive sources of energy wherever possible. The experiment underway is aimed to calculate the amount of energy that can be saved through sustainable building practices. Pictured here is an illustration of a standard villa (left) along with a passivhaus.
green buildings | business interview
Doha’s Tornado Tower can cut power consumption by 20 percent, thus reducing carbon emissions while lowering energy costs, according to Siemens. (Image Corbis)
region because it took some of the items that related to the region, like those related to water and energy. GSAS also selected some other topics, which were not covered previously, for example there is a GSAS for mosques, we don’t have that in LEED. Similarly, there is GSAS for railways. The system selected subtopics that are more related to the culture of Arabian countries. But, it depends on the developer or the owner’s strategy to choose whether he would like to go with GSAS or with LEED. Qatar Foundation goes with LEED, as per their strategy while some other organisations go with GSAS, but it doesn’t harm to go for a dual certification such as is the case with most of 2022 World Cup stadiums. Once you start collecting the points related to your rating system, it is an easy process to get another certificate, so you can get dual certification. Tell us about QGBC’s agreement with the Chartered Institution of Building Services Engineers. A policy of Qatar Green Building Council is to bring experience from professional institutes to Qatar, we do memorandums of understanding with many organisations with experience of more than 100 years. We always try to bring experiences from other countries and see their applicability in Qatar, so we bring experiences, research projects, technologies, and studies from other countries and try to do the same thing in Qatar. We don’t reinvent the wheel or start something from scratch. Instead, we build on what they have achieved. The Chartered Institution of Building Services Engineers is a well known organisation in the United Kingdom and Europe that focuses on buildings. The collaboration is to bring experiences, do more training, see what companies worldwide have achieved and get latest updates on the technologies that can support green buildings. That’s because a green buildings is not only related to the construction stage, it goes to the operation stage. How we operate our building should be very efficient with regard to energy, water and waste. How does QGBC maintain its network? We work through our volunteers, we have
“Water is the most important element that we consider in green buildings.” more than 70 volunteers from different nationalities. They are professionals working in Qatar who meet every month and work very closely with us. We do projects together and benefit from their experience as they are more involved in the industry. Based on their fields and experience, we have divided them. We try to select a topic for each interest group or each volunteer group and then make a case study with a fact sheet about the problems in Qatar and how we can benefit that with regard to regulations, and best practices and [implement] those kind of ideas. There have been talks about Qatar’s Green Economy road map. Can you tell us about that? One of the things that we see developed much in the West and the United States is the Green Economy, sometimes known as, ‘Green Deals’. That’s because in the West, energy is very expensive, so retrofitting an existing building or investing in existing building is very beneficial because saving energy can pay you back. It is the opposite here, and energy is much cheaper. So that makes the attraction to energy-saving investment much less because it has some cost and the developer or the investor should make benefit, show that he can get paid back in three to five years. Also, such investments need financial organisations for financing, such as banks or investment companies and regulators. Many parties are involved in the process. We have established a Green Economy interest group, with a role to put together guidelines for green investment. In its first meeting, we had many banks along with development companies.
business interview | green buildings
How do you think Qatar’s construction industry has progressed from paper documentation towards technology where the documentation is done on devices? It varies from company to company actually. Some big organisations that utilised this concept are doing well because moving from paper-based administration work to electronic or smart way of dealing with paper is not just about saving money or protecting the environment. It also increases the efficiency because all the documentation will not be lost, you can retrieve them all, you can get them anytime, anywhere, the revisions are always updated for the users so the performance is different from paper-based administrative work. At QGBC, we organise a No Paper Day to raise awareness. We try to show real examples of improvement in performance and efficiency of many organisations that adopted this approach. Which stakeholders do you think are more resistant to the idea of sustainable buildings than green buildings? The developers, because there is always a perception gap of the cost. The developers think green buildings delay their project’s development because they need to apply certain elements in their project which they want to develop as fast as they can to generate revenue. Besides that, they think that it will have a huge impact on cost. That’s what we try to educate, that green buildings should be considered as an investment, not a cost, because in all aspects it is very beneficial to the development itself. For example, if you have a green building, for sure the materials that you use will be very good and energy consumption will be much less. Also, green buildings provide better indoor environments. There are always good architectural designs that give very good performance and reduce the operational cost of the building. All materials certified by the green buildings codes are healthy and control toxic agents in the environment So green buildings are very beneficial for the tenants as well. In fact, if you have a green building and a normal building, what do you think the value of the green building will be in the market? It is higher. Whether in Qatar or Europe, a green building’s price in the market will be higher all over the world. Even the demand for occupying that building will be higher. What is the current status of the passivhaus experiment? After two families have occupied the passivhaus and normal villa, we will do the post-occupancy measurement. We will compare the performance of the two houses together. Six months after that, we will
According to Al Shamari, one of the biggest producers of waste in the near future will be railway projects, a fact that is being considered by Qatar Railways Company. A part of the GSAS criteria for rails is to manage this waste.
“We have established a Green Economy interest group, with a role to put together guidelines for green investment.”
take the two families for behavioural education on how to perform in their houses to reduce energy, water and waste consumption. Then we will send them back to the houses again for further evaluation. It will take another one year doing post-occupancy evaluation. The criterion for selecting these families is that they share similar demographics, background and habits, so it will be a fair competition between both houses. Ongoing construction activities will inevitably lead to a great amount of waste. What are some ways for effective waste management? There are some companies who do waste management in Qatar. One of the biggest producers of waste in the near future will be railway projects and that is all [being] considered by Qatar Railways Company. A part of the GSAS criteria for rails is to manage the waste. The amount of waste also depends on the nature of construction. Some construction projects produce relatively very small amount of waste compared to the mega projects. So the focus now is on the mega projects such as the dredging works, developments such as Lusail city and rail networks, some of Qatar Foundation projects. Many of them have their own waste management plans and the Ministry of Environment has a centre to control it. They try to be a coordinator between
green buildings | business interview
Qatar National Convention Centre was conceived with a focus on sustainability. It was built according to US Green Building Council’s Leadership in Energy and Environment Design (LEED) gold-certification standards.
the companies or the constructions that have produced waste and some other construction sites that need embankment materials. Can you tell us about the hanging gardens of Doha? That was proposed in 2013 by an architect and I think there is some interest from developers. We have very special requirements and the climate that is very hot. So you need to be very selective about the kind of plants that need to be used in such a project. However, it was just an idea that we presented. These things will take some time due to the design and concept and to see the applicability of that concept. So we told [the architect that] we can help in selecting the type of plantation and irrigation systems that are best for use in Qatar. Can you tell us about QGBC’s library? We are working on our own library. We have some important textbooks in Qatar related to green buildings. Anyone interested can come and have a look. We have selected some of the most important topics related to green buildings, such as waste management, green terms, infrastructure and green architectural concepts. A part of these reference documents will also be available online for the members. What is the major concern for Qatar when constructing green buildings? We have special criteria for Qatar, for example, we work with LEED in defining
something we call national priority credits. So LEED has a generic standard for the whole world, but it also has specific elements for each country. Same is true for GSAS. In Qatar, we have 10 priority credits, we selected six of them to be about water. So water is the most important element that we consider in green buildings. The second thing is energy. In our environment, we always try to focus on insulation because many things are affected by high temperature. The biggest consumer of energy here is the heating, ventilation and air-conditioning system. So insulation is a very important aspect that we need to focus on. In fact, the passive house (passivhaus) concept is to focus on two major elements: water consumption and insulation. Insulation does not only mean wall insulation, but also glazing, because most of the heat losses are through windows, roof and walls.
“All Ashghal projects now will be GSAS or green buildings certified projects.”
In March 2012, RasGas headquarters, based in the south tower of the Palm Towers in West Bay, Doha, was awarded Qatar’s first LEED Certification for Commercial Interiors with gold level by the US Green Building Council. (Image FotoArabia)
Global outlook for Islamic banking How six nations – Qatar, Indonesia, Saudi Arabia, Malaysia, UAE and Turkey – can shape the prospects of the Islamic banking industry
While the growth in shari’ah-compliant assets around the globe has been exponential since their widespread emergence in the 1970s (from around USD10 million or QAR36.4 million to around USD2.2 trillion or QAR8 trillion according to collective industry data), the prospects of the Islamic banking industry have not been so unequivocally positive during that time. But global analysts have pegged the fortunes of the Islamic finance industry on a six-nation bloc – Qatar, Indonesia, Saudi Arabia, Malaysia, UAE, and Turkey (QISMUT), writes Simon Watkins
Qatar’s financial hub of West Bay in Doha is becoming increasingly prominent in the world of Islamic finance, particularly the banking subsector. (Image FotoArabia)
feature story | islamic banking
T
he average return on equity of the 20 leading Islamic banks is currently around the 12 percent level compared to 15 percent for comparable conventional peers, and there still remains no global pure-play Islamic banking leader with a broad or specialised business model of the Citibank or Goldman Sachs ilk. Having said this, according to Standard & Poor’s (S&P’s) and Ernst & Young’s (EY’s) World Islamic Banking Competiveness Report 2013-14, the six-nation QISMUT are at the forefront of the Islamic banking industry’s development currently, and are expected to continue to lead the way in its future internationalisation, together with Bahrain from the regulatory side. “QISMUT holds a disproportionately large amount of the industry’s financial and intellectual capital,” says Ashar Nizam, executive director and Islamic financial services leader at EY, in Bahrain, “and this finds resonance in the fact [that] two thirds of the world’s 38 million or so Islamic banking customers reside in the region.” Within this group, Qatar’s overall banking sector has grown around 16 percent over the last five years, with Islamic banks
Khalid Howladar, senior EMEA analyst for Moody’s, in Dubai, tells The Edge, Qatar also has an advantage in this banking sector over its GCC neighbours in that, “It has been the most direct in its support of the sector by forcing conventional banks to divest their Islamic operations, and it is also a volume issuer in the sukuk market which also helps the Islamic banks.”
50 | The Edge
70
million
Projected number of global Islamic banking customers in 2018.
holding around USD55 billion (QAR200.2 billion) in assets and expected to sustain a 20 percent plus growth trajectory over the medium term (according to EY). Specifically in Qatar’s case, this is likely to be bolstered by ongoing high demand for corporate credit with investment in infrastructure remaining at exceptionally elevated levels ahead of the 2022 World Cup. Moreover, Khalid Howladar, senior EMEA analyst for Moody’s, in Dubai, tells The Edge, Qatar also has an advantage in this banking sector over its Gulf Cooperation Council (GCC) neighbours in that, “It has been the most direct in its support of the sector by forcing conventional banks to divest their Islamic operations, and it is also a volume issuer in the sukuk market which also helps the Islamic banks.” Indeed, and as echoed in the marketing angles of many of Qatar’s foremost Islamic banks, there has been an especiallystressed demarcation between shari’ahcompliant and conventional ‘Western’ banking since December 2011. Since then, in line with the outstanding success of Malaysia’s Islamic banking and sukuk industry, Qatar’s commercial banks were required to transfer accounts from their Islamic divisions into a portfolio to be held by the central bank until they matured. “These will be carried in a portfolio, outside the activity of their business,” underlined Qatar Central Bank Governor, Sheikh Abdullah bin Saud Al Thani, at the time “as we are not in the business of mixing the Islamic with the non-Islamic.” This followed a central bank directive in February of that year to stop commercial lenders from taking new Islamic deposits immediately, and shutting Islamic branches
by year-end on concern they may be using funds from the conventional bank for Islamic loans. As a consequence of this, Paris-based Mohamed Damak, global head of Islamic finance, S&P, tells The Edge. “Profit figure-wise, Islamic banks in Qatar compete rather well with their conventional peers, with their main edge being the ability to offer products that are compliant with clients’ beliefs, which conventional banks in Qatar can no longer do.” He adds. “We understand that a portion of the government sponsored projects is to be financed by Islamic financial products alone, and the combination of these two factors means that Islamic banks in Qatar tend to evolve in a relatively protected environment.” So much so, he adds, that S&P estimates the market share of Islamic banks in Qatar grew to 16 percent in 2013, from 13 percent in 2010.
islamic banking | feature story
One set of rules
Turkey
10% Indonesia Pakistan
105%
85%
65%
Egypt
0%
Malaysia
Qatar Jordan
UAE
225%
20%
Bahrain Bangladesh
205%
30%
45%
Qatar’s overall banking sector has grown around 16 percent over the last five years, with Islamic banks holding around QAR200.2 billion in assets.
Kuwait
185%
40%
KSA
165%
50%
145%
60%
125%
70%
Islamic banking market share
Banking penetration & Islamic market share
25%
Of course, in order to stress the ethical investment side of Islamic banking in marketing campaigns there needs to be a coherent, singular set of rules, and establishing these has been an ongoing problem for shari’ah finance in general. In this context, says Khairul Nizam, assistant secretary general of the Accounting Auditing Organisation for Islamic Financial Institutions (AAOIFI), in Bahrain, there is nothing per se to preclude the ultimate financial results
Banking penetration Source: Ernst & Young
Since December 2011 under a Qatar Central Bank (QCB) directive, the country’s commercial banks were required to transfer accounts from their Islamic divisions into a portfolio to be held by the central bank, until they matured. At that time, QCB governor, Sheikh Abdullah bin Saud Al Thani (pictured above on the left), said, “These will be carried in a portfolio, outside the activity of their business as we are not in the business of mixing the Islamic with the non-Islamic.” (Image Reuters/Arabian Eye)
feature story | islamic banking
Islamic banking profit pool across QISMUT
QAR
96.1
billion by
2018
QAR
32.22 billion
by
2012
or effects of a shari’ah-compliant banking product being exactly the same as those of a conventional one. “The key consideration in this respect,” he adds, “is that although the financial effects of, say, an Ijara contract, may be identical as those of conventional leasing, mortgage or loans, whether it is shari’ah-compliant or not depends on how such a product is structured.” A key point in terms of the psychology of the business approach (or, some might say, morality), is that an Islamic banking or financial product which may be structurally similar to the speculative instruments in Western banking must, by definition, still be based on the concept of partnership which involves equal share of risk and reward. In this vein, one of the most recent coherent examples of delivering a single shari’ah-focused message, though, is to be found in Oman, which is the only Gulf Cooperation Council (GCC) country that had not allowed Islamic banking until 2012. In this context, the Central Bank of Oman developed a comprehensive 600-page regulations guide within the space of six months, and drew input from authoritative sources, highlights Nazim. For example, the existing conventional banking framework was based on Omani Banking Law and Basel guidelines (where they do not contradict shari’ah principles). Moreover, the AAOIFI’s shari’ah, governing, and accounting standards were adopted, together with the Islamic Financial Services Board’s guidelines on capital adequacy and 52 | The Edge
risk management. Providing a clear vision of a shari’ahfocused banking strategy should also have a dramatic knock-on effect on the profits of Islamic banks in Qatar, and elsewhere, going forward, even so far as closing the profitability gap between them and the conventional banking average.
Untapped opportunities
According to EY’s Singapore-based Jan Bellens, global emerging markets leader for banking and capital markets, Islamic banks need to focus on three key areas. Firstly, he says, typically they have not tapped into the customer cross-selling opportunities available. “The average product holding per client of 2.1 in Islamic banking compares to 4.9 products in the established conventional banking sector, which would increase profitability by up to an estimated 50 percent, and a targeted cross-selling programme supported by a productivity
S&P estimates the market share of Islamic banks in Qatar grew to 16 percent in 2013, from 13 percent in 2010.
islamic banking | feature story
Oman is the only Gulf Cooperation Council country that had not allowed Islamic banking until 2012. In this context, the Central Bank of Oman (pictured) developed a comprehensive 600-page regulations guide within the space of six months, and drew input from authoritative sources. (Image Arabian Eye/Corbis)
toolkit for the frontline bankers and by customer analytics can bring about a dramatic uplift in this number.” Indeed, much of the increase in the number of Islamic banking clients – to a projected 70 million plus by 2018 – is likely to come from the retail side based on segmentation and cross-selling, according to Bellens, especially through leveraging low-cost, long-term zakat (taxation arrangements), waqf (religious endowments), and government funds to diversify to the mass market and small businesses. “The broader asset strategy would be to pass on funding cost advantage to promote inclusive growth unlike many conventional microfinance models – that invest in under-developed segments to benefit from higher marginal returns,” underlines Bellens. Secondly, he says, Islamic banks can further enhance their revenue growth by targeting the affluent customers with a segmented value proposition, with a stronger focus on wealth management. To deliver this, though, they need, thirdly, to decide on the segment proposition and its branding, the relationship model, the service model, and efficient infrastructure. “The focus should be on efficiency programmes to address their disadvantaged cost base plus increased service quality, lead-time improvement,
Credit growth comparison in Qatar USD billions 140
30%
120
25%
100
20%
80
15%
60
10%
40
15%
20
5% 0%
0 Domestic Credit (left-axis) Source: Standard & Poor’s
Islamic banks credit (left-axis) % of credit owned by Islamic banks (right-axis)
and better risk management,” he highlights. “This can be achieved by a tailored ‘lean banking’ programme for end-to-end process improvement, leveraging digital technologies that interface smoothly with legacy systems or avoid their constraints.” EY concludes that the Islamic banking profit pool across QISMUT will reach at least USD26.4 billion (QAR96.1 billion) by 2018 (48 percent of all banking system profits in the group countries), up from USD9.4 billion (QAR32.22 billion) in 2012, and globally, the Islamic banking profit pool is projected to reach USD30.5 billion (QAR141.5 billion) by 2018.
Renewed focus
This re-focus on the essence of shari’ah finance is all the more important as the exponential outgrowth that had been seen in the early years of Islamic banking has been waning in key geographic regions, including the Middle East, according to AT Kearney Middle East. Moreover, in line with the findings outlined above, any growth in assets has not necessarily been matched by profitability, with several of the smaller Islamic banks in the GCC in particular having struggled for years in this regard. The key to challenging the newer and improved post-Basel III conventional banking system in the West, says AT Kearney’s Cyril Garbois in Dubai, comes down to two basic choices for Islamic banking. The first is to more fully exploit the shari’ah-compliant niche, whilst the second is to compete with conventional banks head on. In terms of the former, he underlines, it is vital to target potential customers who care deeply about shari’ah compliance, as well as offering products and services that meet not only general financing but also Muslim-specific customer needs. In retail banking, target customer segments may include religious conservatives, awqaf employees, or employees of ministries of Islamic affairs. An example of such Muslimspecific retail banking is financing for the pilgrimage to Mecca. The latter approach, meanwhile, requires identifying customer segments least open to Islamic banking (for exclusion), those with needs not fully met in a shariah-compliant manner to address shortfalls, and those open to ethical banking to tap into a wider audience of both Muslims and non-Muslims. The Edge | 53
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Special Section: Automotive Reviews 2015’s New Models The Edge takes a look at some of 2015’s new automotive releases.
Inside:
56 Chevrolet New 2015 Tahoe 58 Hyundai All-New Genesis
special section | automotive reviews
All-New
2015 Tahoe T
he all-new 2015 Chevrolet Tahoe incorporates new technologies, including radar that contributes to 360 degrees of crash avoidance and occupant protection. Standard and available features include forward collision alert, front park assist, lane departure warning, lane change assist, and rear cross traffic alert and adaptive cruise control. Chevrolet’s Safety Alert Seat is available and offers directional vibrations to alert the driver to potential crash threats. The Tahoe also offers up to seven airbags including the segment’s only frontseat centre air bag (bucket-seat models), which is engineered to provide additional protection for drivers and front passengers in far-side impact crashes. Chevrolet’s full-size SUVs have been designed with greater security features to thwart theft. The exterior designs of the 2015 Tahoe are also more refined with new inlaid doors fit which significantly improve the quietness of the interior cabin and contribute to improved aerodynamics. Projector-beam headlamps flank the Chevrolet-signature 56 | The Edge
dual-port chrome grille and sweep into the front fenders. High-intensity discharge headlamps and light-emitting diode daytime running lamps are included on the up-level LTZ model. The 2015 Chevrolet Tahoe’s nextgeneration MyLink provides easy, intuitive basic functions, yet is also highly customisable and capable of linking up to 10 devices such as smartphones, SD cards and MP3 players. The 2015 Tahoe is engineered to deliver the customer a quieter, more-controlled ride and improved steering and braking feel on a stronger, fully boxed, perimetre frame, which supports unrivalled payload and trailering capability. The new SUVs are further enhanced with a stronger frame and a wider rear track; LTZ models include third-generation magnetic ride control, a real-time damping system that delivers more precise body motion control by “reading” the road every millisecond and changing damping in five milliseconds. The new electric variable-assist power steering system enhances fuel economy and tailors
steering assist to vehicle speed and the new four-wheel-disc brake system with Duralife™ brake rotors offers up to double the service life, along with brake pedal revisions, that improve pedal feel for stronger-feeling, more-confident braking performance. Tahoe and Suburban’s standard 5.3L V-8 feature technologies, including direct injection and an advanced combustion system. The engine is mated to a Hydra-Matic 6L80 six-speed automatic transmission, featuring TapShift control, Tow/Haul mode and Auto Grade Braking. Chevrolet Care is Chevrolet’s promise to give customers total peace of mind by providing competitive service pricing and cost transparency; booking service with same-day delivery; quality service by certified technicians; regional 24x7 roadside assistance; and a regional threeyear/100,000 kilometre (km) warranty. Exclusively in Qatar, Jaidah Automotive also offers piece of mind to customers who buy a Tahoe 2015 with free 3 year or 60,000 km service.
special section | automotive reviews
2015
Hyundai
All-New Genesis
S
tep inside Hyundai’s all-new Genesis, and the loudest sound you’ll hear is silence. That’s because this new model uses more – and better – soundproofing than the original Genesis, and it’s just one indication of the high standards of luxury and technology found in Hyundai’s premium rear-wheel-drive high-tech sedan. The All-New Genesis is benchmarked against some of the world’s top models, including the BMW 5 series, the Audi A6 and the Lexus ES. And it shows. As Hyundai’s flagship, the All-New Genesis features several cutting-edge technologies, from Head-Up Display (HUD), which projects a virtual image of both 58 | The Edge
speed and navigation information onto the windshield; to Blind Spot Detection (BSD) and a Lane Departure Warning System (LDWS), which is available only in GCC countries. The All-New Genesis also boasts a number of Hyundai firsts, such as the Smart Trunk function (which opens the trunk automatically when the driver stands behind the car for three seconds with the key in their possession); and Autonomous Emergency Braking (which automatically activates the brake appropriately when it registers any sudden braking by the car in front, even if the driver has not applied the brake). Middle East drivers will be able to choose from two impressive engines for
the all-new Genesis, both of them mated to an eight-speed automatic transmission with variable gear ratios. The flagship powertrain is Hyundai’s most powerful V8 engine, the awardwinning Tau 5.0-litre GDI; while the Lambda 3.8-litre GDI has been upgraded to a three-stage variable intake system, triangular pattern fuel injector for improved combustion, an air-gap exhaust manifold for reduced noise, vibration and harshness, and an upgraded cylinder block. Finally, the all-new Genesis has been developed on a completely new platform, using even more advanced high-strength steel than before and giving it the strongest body of any vehicle in its class.
LUXURY, DRIVEN BY PERFORMANCE
● ● ● ● ● ● ●
Fluidic Sculpture 2.0 Design Philosophy Class–leading 333 HP Engine 8-speed SHIFTRONIC® Automatic Transmission 125.3 cu.ft. best-in-class total interior volume Head-Up Display ● Electroluminescent Gauge Cluster Smart Trunk ● Autonomous Emergency Braking Blind Spot Detection ● Around View Monitor
Starting from QR 169,000
● ● ● ● ● ●
5 Years/100,000 Km - Maintenance Service 5 Years/Unlimited Km - Manufacturer’s Warranty 5 Years - Roadside Assistance 5 Years - Service Courtesy Car 5 Years - Home to Home Service Life-time Dedicated Service Advisor
Hyundai Showroom
DOHA - 4435 5117 • AZIZIYA - 4416 3300 Sales Hotline: 6698 7331
Open 7 Days A Week
Email: info@hyundai-qatar.com www.hyundai-qatar.com
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Inside the minds of leading business figures
business insight Asset and balance sheet management redefined 64
With the financial services recalibration after the 2008 collapse, the industry has not only
discovered what it should not do, it has also come to understand what to factor in, how to correct course and what to do better. Carmen Haddad, CEO, Citibank NA – QFC Branch (Citi Qatar) – spoke to The Edge’s Aparajita Mukherjee about her career with the organisation and the bank’s plans.
Long-term strategies and short-term actions are moulded by a set of core values 62 Dyarco is a formal partnership between Al Faisal Holding and Ebrahim Al Neama & Sons Holding Group, both of which are well established. Dyarco’s initial business strength came from the nation’s natural resources of oil and gas industries along with a representation of multinational energy companies. In an exclusive conversation with The Edge, U. Achu, general manager of Dyarco, spoke about how the group, comprising 42 companies, is managed by implementing basic business principles.
64
Corporate finance is a core business activity for Citi Qatar. “Our primary focus going forward is on those corporates leading the pack, which are local champions that have become global players. While those may have government stakes (both financially and being part of their boards), they are very much commercial entities that started local but have grown exponentially with presence in 10 to 20 countries for each of them, challenging other global players,” said Carmen Haddad, CEO, Citi Qatar. (Image FotoArabia)
The Edge | 61
business insight | group management
partnership excellence
Long-term strategies and short-term actions are moulded by a set of core values
Dyarco is a formal partnership between Al Faisal Holding and another prominent Qatari Group, Ebrahim Al Neama & Sons Holding Group, owned by Ebrahim Al Neama. Both are well established and have diversified business interests, including industrial manufacturing and trading. Dyarco’s initial business strength came from the nation’s natural resources within the oil and gas industries, along with a representation of multinational energy companies. In an exclusive conversation with The Edge, U. Achu, general manager of Dyarco, spoke about how the group, comprising 42 companies, manages by implementing some core and basic business principles. Tell us about yourself. How have your stints previous to joining Dyarco facilitated your role at Dyarco? Prior to joining Dyarco in 2000, I was holding senior managerial positions with prominent international banks and also a consultancy for a World Bank-funded project. My overall banking experience of over 22 years, experience in the finance and project consultancy and service industries must have helped me to provide Dyarco a reasonably good start and to develop it eventually. What is the core business philosophy espoused by the Dyarco group? We try to do business in a fast, smart and transparent way. We strive to implement the critical initiatives required to achieve our vision. In doing this, we deliver operational excellence in every corner of the company and meet or exceed our commitments to the clients we serve. All of our long-term strategies and shortterm actions are moulded by a set of core 62 | The Edge
values that are shared by each and every associate. With 42 companies under the Dyarco umbrella, what top five things would you highlight about the success factors? Over a period of time, Dyarco has expanded to other industrial sectors, diversifying rapidly into petrochemicals, civil and mechanical engineering, engineering design consulting, marine offshore service and logistics, telecommunications, IT and security systems, landscape piping, interior design, vertical transportation, construction, air conditioning and paints. The key factor that has enabled us to manage this diversity is to have a long-term strategy to be a strong participant in the growth of this country. We also diversified our activities, thereby mitigating risks. Dyarco believes in strong business ethics and transparency. We also have a proactive approach to the principals or the joint venture partners and a willingness to share
“As an active participant in various infrastructure projects, Dyarco’s role would grow with the general increase in outlay of capital in those projects.”
group management | business insight
“Diversification into different activities according to demand in the respective industry was a sensible move.”
skills and knowledge. Our staff has a high level of motivation and is a spirited lot. With so much construction work going on and in the pipeline, what prospects do you foresee for the group as a whole? Our role as an active participant in various infrastructure projects would grow according to the general increase in outlay of capital in those projects. We expect continued growth according to overall economic activities. Being a business group that was set up in 1992, what did the group have to change in the past 20 plus years, in terms of the ways that it does business? Our way of doing things has changed according to the rapid growth in technology, demand conditions and the general business expectations. As a group that dealt primarily with hydrocarbon products, what would you attribute as the reasons for diversification into other allied and non-allied industries? The activities related to hydrocarbon were limited to one client, and eventually we decided to expand activities to enhance revenue and to mitigate risks. So, diversification into different activities according to demand in respective industry was a sensible move. Partner selection is a major decision and any foreign company that wants to enter Qatar will need a domestic partner. How do you select partners in other countries? In most cases, our partners selected us and we have been choosy too. In certain cases, we would go through certain missions or their commercial wing to identify potential partners abroad. What are Dyarco’s business prospects in the next three years? The expansion of current portfolio according to demand conditions continues to be our priority. We review potentials versus trends and risks. If the regional or world economy does not affect the Qatar economy, we expect to maintain our growth in the next two to three years and beyond.
U. Achu, general manager of Dyarco, told The Edge, “We develop our business strategy based on the demand conditions envisaged in the immediate circumstances and on a long-term basis.”
Do you foresee any more diversifications in your business streams? If so, what are the sectors that you think are the most prospective? Certain diversifications are natural as we expand to selected areas and also allied support services. New technology-driven activities remain our focus areas. We develop our business strategy based on the demand conditions envisaged in the immediate circumstances and on a long-term basis. The Edge | 63
business insight | banking
BESPOKE SOLUTIONS
Asset and balance sheet management redefined With the financial services sector’s recalibration after the collapse of 2008, the industry has not only discovered what it should not do, it has also come to understand what to factor in, how to correct course and what to do better. Carmen Haddad, chief executive officer (CEO), Citibank NA – QFC Branch (Citi Qatar) – spoke to The Edge’s Aparajita Mukherjee about her career with the organisation and the bank’s plans for the future. Haddad identifies deeply with the lessons that the global financial services community has learnt from the financial crisis of 2008. That period, in Haddad’s opinion, has set the context in which the industry operates today. “Having survived the most recent global financial crisis after more than 20 years in the industry,” she said, “what resonates is the importance of responsible financing, proactive engagement with clients on asset allocation and diversification discussions that use industry and sector expertise and the ability to apply sound judgement to risk management.” Clients have also become more sophisticated and demanding, added Haddad. “I think what is key for clients today is transparency and partnership with key financial providers,” she said. Haddad has also found that real estate has become a core anchor investment resource, and also a product that clients are really interested in. Explaining this investor sentiment, Haddad said, “A good deal of dialogue is around real estate investments as an anchor asset class. Institutional investors and private clients are actively looking for offshore real estate opportunities that meet the capital appreciation and income yield targeted objectives, and they are sourcing deals in all major cities in the world. Career span Haddad joined Citi in January 2000 and has primarily focused on the private wealth management sector, spending a lot of time on structuring investment solutions and sourcing bestin-class products from the world’s best investment platforms. 64 | The Edge
“We provide offshore solutions for sources and uses of funding that are earmarked for offshore investment and diversification. Thereafter, client dialogue ensures bespoke solutions and structuring that will hopefully meet the set objectives,” Haddad added. In order to gain the clients’ trust, one needs various qualifications across the board, and, she explained, what has helped Haddad in her career is that she hails from an investment, trading and brokerage background, which has kept her abreast with markets and helped her identify the right fit for a client. According to Haddad, Citi has a phenomenal footprint, not from a geographical point of view alone but also across products, services, talents and people. “When you look after the institutional and private client base, it is really important to be able to deliver bespoke global solutions with an understanding of local specifics. To do that effectively, we at Citi fuse the best functional talent from across the organisation which results in more relevant results,” said Haddad. Approaching almost 15 years with Citi, Haddad has overseen private banking, corporate finance, direct investments, capital markets and equity-structured solutions. How has this career path prepared Haddad to become the CEO of Citi in Qatar? “It is incredibly important to be able to represent the bank’s values and be an ambassador while understanding the clients’ needs from institutional, corporate and private perspectives,” Haddad responded. “This is especially important in the context of Qatar where a sizable slice of our target market comes from an
banking | business insight
According to Haddad, as co-chair of the Citi Women Network in the region, the network’s aim is to focus on promotion, career development and diversity. “We are focusing our efforts to be more locally relevant by enhancing our local social responsibility and expanding our partnership with INJAZ and other non-profit entities that focus on the promotion of women and future generations,” Haddad said. “To go further,” she added, “our employees are our most valued commodity and the talent pool at Citi is simply remarkable. Talent and the ability to harness the breadth of our innovation and network at the global level to each of the 100 plus countries in which we operate are extremely powerful.”
Carmen Haddad, CEO, Citi Qatar told The Edge, “When you look after private clients, it’s paramount to be able to deliver bespoke global solutions with an understanding of local specifics. To do that effectively, we at Citi fuse the best functional talent from across the organisation which results in more relevant results.”
entrepreneurial background, with family ownership which is the predominant ownership structure in the country.” Tailored deals Client relationship and bespoke solutions are what other entities in the financial services segment also talk about as their strengths. Since opening the Branch in 2007, Citi Qatar has facilitated financing on behalf of clients ranging in size, complexity and specialisation, across a product spectrum comprising syndicated loans, fixed income instruments (bonds and sukuks), cash and trade, debt services, equity (IPOs), structured finance, mergers and acquisitions (M&A) advisory, and bilateral loans. “Our focus is our partnerships and improving the quality of our relationships locally,” said Haddad. “Citi’s priority is to provide the multi-product capabilities, including both Islamic and conventional finance and advisory services.” With the sector becoming more competitive in the country and region, how does Citi stand out in this crowd? Haddad’s take is that having celebrated its 200th anniversary recently and with a continuous presence in the Middle East and North Africa region for more than 50 years, Citi has a proven track record with its client base. “Having maintained a presence for more than half a century allows us to carry a legacy of global expertise, client focus and local knowledge that takes decades to cement,” she explained. “The value proposition is being client-centric and it’s reflected in how we come to work every day.”
Citi Qatar: Business segments Being a role player in the investment banking market here, a question arises: How does the functional demarcation of being within the Qatar Financial Centre (QFC) restrain or add to what Citi, as an institution, can do? For Haddad, QFC is business friendly with highly qualified professionals working to continuously enhance the regulatory framework. “We operate under a category 1 licence with an onshore presence primarily focused on corporate and investment banking activities and are regulated by the Qatar Financial Centre Regulatory Authority (QFCRA) which has brought a wealth of international regulatory talent to Qatar. The active collaboration with the Qatar Financial Markets Authority (QFMA)/QFCRA is indeed critical when considering the strategic direction for Citi Qatar and its growth prospects,” Haddad said. “Qatar’s infrastructure programmes are enormous in size and complexity. We are engaged to ensure our participation across project finance and various debt capital markets, M&A and advisory roles are aligned with Qatar 2030 Vision,” Haddad said. She added that this could be in an advisory role, finance structuring, exit plan, monetisation schedule, portfolio valuation, specific synergies that promote M&A activities, and other various deal flows that support the Qatar branding and its robust investment strategy. “Except for the stadiums, which represent less than one-tenth of total infrastructure pipeline, we certainly expect the project financing activity to pick up. Citi naturally wants to be part of the growth and development of the country and where our expertise can help in that endeavour, we certainly will focus on delivering it,” Haddad added.
“It is important to be able to represent the bank’s values and strategic vision while understanding the clients’ needs.” – Carmen Haddad, CEO, Citibank – QFC Branch (Citi Qatar). The Edge | 65
products & reviews
Read it:
Global Tilt: Leading Your Business Through the Great Economic Power Shift “The world has titled, its economic center has shifted from what have traditionally been called the advanced or Western countries of the northern hemisphere to fast-developing countries…” This is the central idea of Ram Charan’s Global Tilt: Leading Your Business Through the Great Economic Power Shift. This economic shift, the author writes, is complemented with the transfer of knowledge and technology. Previously flowing from North to East, information in today’s world moves from North to South. An effective way of expanding knowledge base to eventually increase economic capital, Charan says, is by way of inviting global investments with strategic protections. China, for instance, invited United States and European aircraft-manufacturing companies to build plants in China. The invitation, however, came with a restriction of establishing businesses with local partnerships. Such deals effectively mean the international companies bringing their global experience and knowledge with them, thus driving the tilt from the North to other parts of the world. Moving in from economic and knowledge power, “as economic power shifts, political power does too.” Eventually, with economic and political changes in the backdrop, businesses too have to tilt their corporate strategies. Once considered as a benchmark for many industries, the North can no longer be followed blindly when taking
Read it:
Bad Banks
The current decline in the price of oil has caused some pessimistic analysts to speculate that should the downward trajectory of the value of ‘black gold’ continue, the world’s collective economy could enter another recession. Barely six or seven years past the last one (depending on when you believe it began and when it ended) this is an interesting if exceedingly negative and depressing prospect, especially when the ‘great recession’ as it was termed, has barely passed from memory. Of course it was not the depressed price of the world’s most utilised commodity: crude oil; rather it was the shenanigans many of the world’s once-trusted but now largely derided finance professionals at the root of all our woes in the late ‘naughties’. And this, self-evidently, is the chief topic of Bad Banks. At this point we must note the book is written by Alex Brummer, City Editor of London’s Daily Mail. This is a newspaper often derided for its trashy and sensationalist content (and is a leading proponent of criticisms of Qatar, too). 66 | The Edge
crucial business decisions. Similarly, the competitive environments are changing to reveal a diverse range of organisations following varied business models, as adds the author “This is a new century and a new game being played on an uneven playing field.” Setting a background, which very much explains the crux of the book, Charan moves forward to explain the changes bringing the global tilt and why it is crucial for any businessman to know about these forces. The third chapter of the book talks about leading companies originating from the South, emerging as global leaders in the future. By discussing these companies’ managerial tools, best practices and leadership psychology, the writer guides businesses all along. Closing on the note that the global tilt must not discourage the North, in the final chapter, Charan focuses on some successful Northern companies, “proving that any company with the right combination of strategy, leadership, organization, and execution can win the tilt”.
But that aside, when it comes to coverage of economic and financial matters, through one of its main correspondents Brummer, the British newspaper tends to afford the subject matter more gravitas, while at the same time retaining its scepticism and gutter sniffing credo. Which is probably a good thing, considering the despicable behaviour of those we once entrusted our money to and those with whom the responsibility to regulate such matters lay. Like a pathologist dissecting a rotten, decayed corpse, Brummer dissects the root causes of the financial collapse at the end of the last decade from a British perspective and with a distinctly appropriate jaundiced eye. Interestingly, he draws a direct line of cause and effect from the attacks on New Yorks’ Twin Towers – an assault with intent on one of financial hubs of the world - to all the financial woes of the world that came to a head between 2008 and 2009. Brummer also keenly examines what lessons the banking may have, or as it seems have not, learned from the financial crisis and whilst he concludes some progress has been made, feels most banks are far from contrite and the toxic cultures that caused most of the problems of 2008 to 2009 are largely still prevalent. In all, an interesting and enlightening read...except maybe if you are a banker.
Available at Virgin Megastores in Doha.
products & reviews
Canon PIXMA printers Canon Middle East has announced a refresh to its PIXMA home printer range with the launch of four multifunction inkjet printers – the PIXMA MG2950, MG5650, MG6650, MG7550 – and a portable printer, the PIXMA iP110. The new devices have connectivity at their core with easy access to photos and documents stored on the cloud to printing via NFC (near field connectivity.
App Reviews By Mohammed Bilal Iqbal
Anghami Anghami is an ondemand music streaming service that offers millions of Arabic and also international songs. The app allows you to choose from a multitude of premade playlists and add songs to your own playlists as you listen. You can also share individual songs and even entire playlists with friends who already use the app. The free version allows unlimited music streaming but is supported by ads. The paid version costs QR20 per month and is ad-free. It also allows you to download the songs you want for offline playback.
Yahoo Aviate
Nokia 215
Microsoft Devices Group has announced the Nokia 215, its most affordable Internet-ready phone. The Nokia 215 is designed to connect and introduce first-time mobile phone buyers to the Internet and new digital experiences. Available in both Single SIM and dual SIM models, Nokia 215 will expand the reach of Microsoft services at more affordable prices, allowing more people to access popular Web content and digital services.
Aqua Amaze handset
Aqua Amaze handset by Intex Technologies has been launched in the Gulf. The gadget features 1.4-gigahertz (GHz) Octa Core Processor, a 13-megapixel (MP) rear and 5-MP front cameras with a backside illumination (BSI) sensor. The phone comes with a 1-gigabyte (GB) RAM and 8-GB internal memory, on-the-go support, smart gestures, proximity sensor, LED indicator and a gift box.
Panasonic 360-degree cameras
Panasonic Marketing Middle East and Africa has announced the regional launch of their first 9-megapixel 360-degree network cameras for indoor and outdoor use. The WV-SFN480 and WV-SFV481 360-degree cameras provide a 360/180-degree field of view, delivering very detailed images with a fisheye, panoramic and dewarped view. The products are ideal for surveillance applications that require wide area coverage.
If you are tired of the default launcher on your Android phone, try Yahoo Aviate. The launcher automatically arranges your apps into categories for easier access. It is also contextually aware, so the widgets and apps made visible to you at work, for instance, will be different from those available to you at home. The launcher also supports custom icon packs from the Google Play Store, thus enabling you to change the entire look of your phone if you wish.
My Fitness Pal A calorie counting app that could be an essential fitness tool. Its vast database will allow you to find just about any food item, though you do have to make approximations for non-standard foods and you can add calorie information manually. Once you make a profile and add your current and target weight, the app will give you the number of calories you should be eating for healthy weight loss, lets you log your exercise and connect to fitness trackers
The Edge | 67