QT September 2014 by Oryx Group of Magazines

inside this issue SEPTEMBER 2014 / VOL. 40/ ISSUE 9

QATAR TODAY TOP

COVER STORY

38 QT TOP 10: PARADISE REGAINED

2013 ended on a happy note for companies listed on Qatar Exchange after the global equity index compiler Morgan Stanley Capital International announced that the local bourse would be reclassified as an emerging market. Qatar Today, along with ALSHALL Economic Services undertakes its annual survey of the top 10 companies.

62 THE GRAND INCUBATION EXPERIMENT

32 THE VOICE OF HER GENERATION

In an exclusive chat with the dynamic young CEO of Qatar Business Incubation Centre, Aysha Al Mudahka, Qatar Today unravels her plans for the ambitious new organisation now under her direction.

60 IS THE CRUNCH COMING?

In an exclusive chat with Director for AECOM Qatar, Steven Humphrey, Qatar Today finds out what kind of roadblocks Doha faces in the run up to the construction frenzy that is set to take over the Middle East in the coming years.

Is Qatar’s nascent incubation scene delivering what local entrepreneurs need? Does it live up to its promises? Qatar Today speaks to incubators and entrepreneurs, going behind the scenes of this fledgling experiment, to find out what’s working, what’s not and why?

76 A VOUCHER FOR SUCCESS

Ambitious to become a successful entrepreneur, an Australian expat based in Dubai works hard to develop her company The Entertainer from a one-woman show born in an internet café to a multi-million dollar global enterprise.

inside this issue SEPTEMBER 2014 / VOL. 40/ ISSUE 9

24 CHINATOWN IN ARABIA

China is looking at the Middle East to safeguard its energy needs to sustain its momentum of growth and has been taking an active role in the region for the last decade.

26 PRIVATE BANKS MUST CHANGE TACK

What should private banks do to tap the increasing successful business owners all across emerging markets in Asia, Africa and the Middle East and not miss the opportunity to represent a potentially huge new client segment?

28 MEDICAL INDUSTRY GETS A SHOT IN THE ARM

Qatarâ&#x20AC;&#x2122;s medical manufacturing sector is projected to grow as the demand for healthcare is on the rise with the graduated introduction of the National Health Insurance Scheme (Seha) and other steps initiated by the government.

34 LAYING DOWN THE LAW

Legal eagle and Managing Partner at Eversheds Qatar Dani Kabbani gives an insight into Corporate Law 101.

72 TRADING WITH OUR NEIGHBOURS

A look into why the intra-regional trade among the GCC member states has remained nearly constant (in proportion to overall trade) over the years.

SPOTLIGHT

78 EDUCATION: BACK TO THE BASICS

Majority of the investments in education in the coming years has to focus on primary and secondary level education, for reasons going beyond the obvious. Qatar Today examines what the policy makers are doing to make the country a knowledge-based economy.

and regulars 12

NEWS BITES

BANK NOTES

O&G OVERVIEW

REALTY CHECK

TECH TALK

100

AUTO NEWS

102

MARKET WATCH

106

DOHA DIARY

from the desk Qatar Today, in partnership with ALSHALL Economic Services, has taken up its annual exercise to evaluate the performance of the 42 companies listed on Qatar Exchange in 2013. The year was eventful for Qatar Inc. as the global equity index providers Morgan Stanley Capital International (MSCI) and S & P Dow Jones have reclassified Qatar bourse’s status from frontier to emerging market. Besides, the reforms introduced by the government have also boosted market capitalisation with a QR100 billion-increase within a year since December 2012, making it amply clear that Qatar’s economy is moving ahead. The much-talked-about human rights violation and labour abuse in the country could soon change for the better with the release of Qatar Foundation’s report on the recruitment of migrant workers. Though this is just a beginning, a detailed analysis of how and where the recruitment process is going wrong, and implementing even some of the recommendations made in the report, could only be a step in the right direction. Is Qatar’s experiment with incubating startups reinforcing confidence among entrepreneurs or achieving just the opposite? Qatar Today finds out what’s happening on this front. Qatar has taken up massive construction projects, much like the rest of the GCC, and we look at what factors could potentially bog down progress in the country. The GCC member states have been doing brisk business with countries outside the region but it is not so within the region. Qatar Today takes a peek into the reasons for the slow pace in the growth of the intra-GCC trade. In the spotlight on Education, Qatar Today discusses the kind of investments that should be made at primary and secondary level education as the country moves towards a knowledge-based economy. Challenges are plenty but so is optimism in the office of the newly-appointed CEO of Qatar Business Incubation Centre, Aysha Al Mudahka, who has big plans to make things move in the right direction. Qatar Today also offers an interesting feature on an Australian expat who turned her startup, which she launched in an internet café around a decade ago, into a multi-million dollar global enterprise. Reports on Chinese companies eyeing Middle East markets, how banks should change tacks to attract the business people in the emerging markets in the region, and other regulars are also part of the issue. Happy reading. V L SRINIVASAN

8 > QATAR TODAY > SEPTEMBER 2014

PUBLISHER & EDITOR-IN-CHIEF YOUSUF JASSEM AL DARWISH CHIEF EXECUTIVE SANDEEP SEHGAL EXECUTIVE VICE PRESIDENT ALPANA ROY VICE PRESIDENT RAVI RAMAN EDITORIAL EDITOR SINDHU NAIR DEPUTY EDITOR V L SRINIVASAN SENIOR CORRESPONDENTS IZDIHAR IBRAHIM ABIGAIL MATHIAS AYSWARYA MURTHY ART SENIOR ART DIRECTOR VENKAT REDDY DEPUTY ART DIRECTOR HANAN ABU SAIAM ASSISTANT ART DIRECTOR AYUSH INDRAJITH SENIOR GRAPHIC DESIGNER MAHESHWAR REDDY PHOTOGRAPHER ROBERT F ALTIMIRANO MARKETING AND SALES SENIOR MANAGER – MARKETING FREDRICK ALPHONSO MANAGER – MARKETING SAKALA A DEBRASS ASSISTANT MANAGER – MARKETING THOMAS JOSE SENIOR MEDIA CONSULTANTS HASSAN REKKAB LYDIA YOUSSEF MARKETING RESEARCH AND SUPPORT EXECUTIVE MATHEWS CHERIAN SENIOR ACCOUNTANT PRATAP CHANDRAN DISTRIBUTION SR. DISTRIBUTION EXECUTIVE BIKRAM SHRESTHA DISTRIBUTION SUPPORT ARJUN TIMILSINA BHIMAL RAI BASANTA POKHREL

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10 > QATAR TODAY > SEPTEMBER 2014

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Very few among my Qatari friends are unhappy with the new mandatory military programme. In fact, many actively welcome it. The duration, a strategic three months, will not drastically disrupt their professional and academic lives while being potentially life-changing. It’s a win-win situation, according to me. ANEES IBRAHIM

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An interesting read. Though it’s hard to imagine a scenario where Qatar would be actively in conflict, the recent developments in the Middle East are not very encouraging. The reason given by the government for the programme might be to “invigorate the youth and give them direction” but it is difficult not to sense the underlying tension. Or it is just my imagination? SALMAN

I particularly liked the part about the special programme they have for overweight cadets. The need of the hour, if there ever was one. Kudos! KHALID MANSOUR

QATARIS IN UPPER MANAGEMENT This dialogue on Qatarisation (“Beyond the Numbers”) is important. Though the article focuses on maintaining the pipeline and training nationals in more core and technical fields, the unsaid story is how crucial roles in companies are given to underqualified and inexperienced managers solely on the basis of their nationality. Qatarisation is critical to building future leaders but if not done right it risks becoming counterproductive. ANONYMOUS

BEST OF SOCIAL MEDIA Qatar Today: “Qatar should seek its legacy planning first to understand the needs for 2022WC & the longer-term use for the sites” - State of Stadiums Sultan S Chaudhry @sam_325: Very true and how to use the labour with respect n dignity who are building these sites as have serious issues QatarToday: Qatar Rail to tap solar energy Roberto Flores @faleno: It’s all about solar... And it’s free! Not free to install! Great job Qatar! Obaid Mohamad @obaidmohamad: The world’s best 10 airlines ... #QatarAirways in second place #Qatar Qatar Today reserves the right to edit and publish correspondence. Views and opinions expressed in the published letters may not necessarily be the publication’s views and opinions.

12 > QATAR TODAY > SEPTEMBER 2014

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affairs > local

DOHA AT THE EPICENTRE OF MORE TALKS A handout picture released by the Palestinian president’s office shows Palestinian President Mahmoud Abbas (left) meeting with HH the Emir Sheikh Tamim Bin Hamad Al Thani and exiled Hamas leader Khaled Meshaal (right) in Doha on August 21 reportedly to persuade the Hamas leadership to renew peace talks after another exchange of missile fire in Gaza.

QATAR DENIES ISIS FUNDING CHARGES

AFP PHOTO/ PPO / THAER GHANEM

QATAR MEDIATES RELEASE OF JOURNALIST In the same week as the horrific beheading of American freelance journalist James Foley, his countryman Peter Theo Curtis, who had been captured in Syria almost two years ago, was released.

eter Theo Curtis was turned over to UN peacekeepers in a Syrian village in the Golan Heights after 22 months in captivity at the hands of an Al Qaeda-linked faction, most likely the Jabhat Al Nusra. The American journalist and author was released after a successful negotiation which involved the Qatari government, though no details concerning the terms of release are known currently. It is understood that a ransom was not paid. “We were repeatedly told by representatives of the Qatari government that they were mediating for Theo’s release on a humanitarian

basis without the payment of money,” Nancy Curtis, mother of the released journalist, said in a statement. Qatar’s foreign ministry has also said in a statement that it “exerted relentless efforts to release the American journalist, out of Qatar’s belief in the principle of humanity and its keenness on the lives of individuals and their right to freedom and dignity.” This the third high-profile and successful hostage negotiation that the state has mediated after the release of a group of nuns held captive in Syria and American solider Bowe Bergdahl, who was held in Afghanistan.

Germany’s Development Aid Minister Gerd Mueller singled out Qatar in a televised interview, claiming it was “arming and financing ISIS troops”.

The minister, while speaking about the history of the conflict involving Islamic State and who were arming and financing the troops, said the “keyword there is Qatar – and how do we deal with these people and states politically?” while not giving any evidence of the alleged links. Within 24 hours the German Foreign Ministry released a statement expressing “regret over the misunderstandings caused” by the minister’s interview. A spokeswoman for Mueller’s ministry chipped in, saying he had merely “referenced press reports” and had made “no concrete allegations”. Qatar’s Foreign Minister HE Khalid bin Mohammed Al Attiyah denied the accusation through a statement which read: “Qatar does not support extremist groups, including ISIS, in any way. We are repelled by their views, their violent methods and their ambitions. The vision of extremist groups for the region is one that we have not, nor will ever, support in any way.” Michael Stephens, Deputy Director Royal United Services Institute in Qatar, weighed in on the German minister’s statement on Twitter, saying: “I don’t think that’s strictly true, I have not observed a direct policy by Qatar to fund ISIS. However, that doesn’t mean individuals who received funding from Qatar who fought for other groups then defected to ISIS don’t exist. They do.” AFP PHOTO / HO / WELAYAT RAQA

14 > QATAR TODAY > SEPTEMBER 2014

ON THE EVE OF THE OPENING OF A QATARI EMBASSY IN SOMALIA, THE COUNTRY’S PRESIDENT HASSAN SHEIKH MAHMOUD MET THE CHARGÉ D’AFFAIRES OF THE EMBASSY IN MOGADISHU, HASSAN BIN HAMZA ASSAD MOHAMMED, AND EXPRESSED WISHES OF FOSTERING A FRUITFUL PARTNERSHIP.

GCC TENSIONS RESURFACE The rift between Qatar and other GCC states was revisited with disruption over the report prepared to monitor the implementation of the Riyadh Agreement.

PICTURE COURTESY: VODAFONE QATAR

QATAR’S NEWEST DIPLOMATIC OUTPOST

VODAFONE QATAR WITHDRAWS SUPPORT FOR CHARITY TRIP The Vodafone-sponsored 'My First Amazon Adventure' ended on a sour note after an outcry on social media and the company’s termination of support for the trip.

AFP PHOTO/FAYEZ NURELDINE

Seven young Qataris were given the chance to experience the wild Amazonian jungles during a three-week adventure, culminating in building a school for one of the most remote communities living in the rainforest, as part of Vodafone’s global "Firsts" initiative. During the course of the regular updates of the trip being made on social media sites, a deeply polarising debate on culture and traditions was sparked off, particularly after pictures and videos were posted of the girls not wearing their headscarves during their excursion. Despite overwhelming support among young Qataris for the trip and what it represents, the telecom operator released a statement saying it was “completely withdrawing from this project and ceasing all kinds of support to it, reflecting the Chairman’s commitment to seeing Vodafone Qatar providing the best services and initiatives that are suitable to the norms and values of the Qatari culture”. This announcement further incensed supporters who blamed Vodafone Qatar for caving under pressure and “abandoning” the young men and women for whom it had assumed responsibility.

atar has reportedly refused to sign the final report, which was due to be submitted to the foreign ministers of the member countries before being discussed at the next GCC meeting at the end of August in Jeddah. Reportedly Doha was offended at the insistence by the UAE, Saudia Arabia and Bahrain that it needed to show “proof of compliance”, according to a London-based daily. Reportedly, the agreement deals with the ban on GCC states supporting terror-related activities, interference with the domestic affairs of other GCC states, or adopting foreign policies harmful to the interests of the other state members, in addition to Qatar-specific cases like the granting of citizenship to Bahraini nationals. QATAR TODAY > SEPTEMBER 2014 > 15

affairs > local

BEST PLACE TO DO BUSINESS

Reflecting its continued economic boom, and the forthcoming infrastructure upgrade, Qatar has been ranked top in the Arab world as the best place to do business in the next five years, according to the Economic Intelligence Unit (EIU). According to the survey entitled “Business Environment Rankings 2014”, Qatar ranked 21st in the global rankings for 2014-18 compared with 2009-2013, ahead of not only the Arab nations but also countries such as the United Kingdom, Russia, Japan, China and South Africa. In the Middle East region, only Israel is ranked higher, at 19th. Singapore looks set to remain the world’s most investor-friendly location in 2014-18, retaining its rank during 2009-13. Switzerland and Hong Kong also defend their respective second and third place positions. In the GCC, except for Saudi Arabia, which improved its position from 45 to 41, other member states such as the UAE, Bahrain and Kuwait slid down. The survey did not cover Oman.

COUNTRY

SCORE 2009-13

GLOBAL RANKING 2009-13

SCORE 2014-18

GLOBAL RANKING 2014-18

QATAR

7.29

7.46

UAE

6.95

7.22

30 35

BAHRAIN

6.80

6.76

SAUDI ARABIA

6.14

6.58

KUWAIT

6.35

6.55

SEHA ONE YEAR ON

16 Apr: Seha brand revealed as the new name of the national health insurance scheme

3 May: Optical coverage launched

27 Apr: Survey show a 84% satisfaction among stage 1 beneficiaries

18 May: Introduction of Diabetes Management Programme

30 Apr: Stage 2 of national health insurance scheme launched covering all Qatari nationals 30 Apr: Provider network expanded to 16 hospitals and clinics

Stage 1

Apr

17 July: Stage 1 of national health insurance scheme launched to cover Qatari women aged 12+ 17 July: Provider network includes one public and three private hospitals

25 March: Customer service centre opened in Doha

May

Jun

26 June: Launch of dental coverage, 11 specialized dental clinics join the provider networks 31 July: 230,000 Qataris benefited from Seha during the first year, including 195,000 since the launch of Stage 2

Mar

17 July: First baby born under the national health insurance scheme 24 July: 688 women make use of the scheme during the first week

Jul 2013

Aug

31 Aug: 4,760 women benefit from the scheme in first six weeks

Sep

Oct

Dec

26 Nov: SCH and NHIC conduct workshop for prospective providers 3 Sep: Three public hospitals join provider network to bring the total to seven

Infograph courtesy: National Heath Insurance Company 16 > QATAR TODAY > SEPTEMBER 2014

Nov

31 July: Provider network grown to include 4 public hospitals, 3 private hospitals, 29 clinics and polyclinics, 43 dental clinics and 1 optical provider with 6 branches

Feb

9 Oct: Maternity Management Programme introduced

Jan

Jul

1 Feb: First polyclinic joins provider network

2014 16 Jan: 30,780 women benefit from scheme during first six months

Stage 2

business > bank notes “SMEs are one of the fastest-growing segments within the GCC and Qatar has put a great emphasis on SMEs. Qatar’s economic diversification requires support of SMEs. Infrastructure development in the form of ports, roads, airports, rail, telecom, other utilities and huge construction activities will continue to take place in Qatar, which in turn, will require continued support from SMEs.”

DR R SEETHARAMAN CEO, Doha Bank

AUB PROFITS UP IN H1 2014

QCB'S

TOTAL ASSETS INCREASE

Ahli United Bank BSC (AUB) reported a net profit of QR955.5 million ($262.5 million) for the half year ending on June 30, 2014. This reflected an increase of 38.1% over the core net profit of QR691.96 million ($190.1 million) achieved a year ago.

QR203Q1BILLION 2014 QR210Q2BILLION 2014 QR147Q1BILLION 2014 QR152Q2BILLION 2014

QR2.33Q1BILLION 2014 QR2.41Q2BILLION 2014

TOTAL ASSETS

QR48Q1BILLION 2014 QR53Q2BILLION 2014 QR145Q1BILLION 2014

NET FOREIGN ASSETS

ASSETS IN GOLD

QR153.6Q2BILLION 2014

BALANCE WITH FOREIGN BANKS NET INTERNATIONAL RESERVES

he Q2 2014 net profit achieved was QR458.27 million ($125.9 million), a 35.1% increase over the Q2 2013 of QR339.24 million ($93.2 million). The basic earnings per share in H1 2014 were 4.4 cents, compared to basic earnings per share of 3.3 cents, adjusted for the exceptional gain in H1 2013. This resulted in a 13.7% increase in net interest income from QR1.22 billion ($335.8 million) to QR1.39 billion ($381.7 million). Diversified business flows and successful client acquisition initiatives contributed to 11.7% growth in fee income from QR255.89 million ($70.3 million) to QR285.74 million ($78.5 million). The year-to-date H1 2014 cost-income ratio improved to 27.8%, contributed by a surge in operating revenues and by the continued successful implementation of the AUB Group’s disciplined cost culture. The total assets rose to QR123.39 billion ($33.9 billion), up 3.7% since December 31, 2013.

QCB ISSUES T-BILLS WORTH QR4 BILLION Qatar Central Bank has issued treasury bills worth QR4 billion, which includes bills worth QR2 billion with a maturity period of three months and QR1 billion-worth bills each for six-month and nine-month periods.

18 > QATAR TODAY > SEPTEMBER 2014

The issuance of bonds and T-bills will help reduce the supply of money in the market and also ease inflationary pressures. QCB’s latest data on the country’s money supply noted that the M1, a measure of the money supply that includes all physical money, has reached QR10.82 billion as of June, compared to QR4.6 billion a year ago. M1 measures the most liquid component of money supply. The M2, a broader measure of money supply, has increased to QR483 billion in the first half of 2014 compared with QR461 billion a year ago.

business > oil&gas

GLOBAL OIL DEMAND FORECAST LOWERED The global oil demand growth forecast for 2014 has been lowered to 1 million barrels per day on lower-thanexpected Q2 2014 deliveries and a weaker GDP outlook from the IMF, according to the Oil Market Report which was released by the International Energy Agency (IEA) on August 12. Growth is set to accelerate to 1.3 mb/d in 2015 as the economy improves. Baseline demand estimates have been raised to reflect new 2012 non-OECD annual data, the report said.

CB&I WINS FEED FOR QPI-LED TEXAS LNG FACILITY

RASGAS REDUCES GHG EMISSIONS

CB&I and partner Chiyoda Corporation have been awarded a front-end engineering design (FEED) services contract for a proposed LNG export project near the Texas coast.

he project, which is part of one of the world’s largest LNG facilities, is being run by Golden Pass Products (GPP), a joint venture between affiliates of Qatar Petroleum International (QPI) and ExxonMobil and ConocoPhillips, where QPI holds a 70% stake followed by Exxon’s 17.6% and ConocoPhillips’ 12.4%. The FEED will be done on the three-train 15.6 million-tonnes-per-annum (mtpa) GPP LNG liquefaction export facility – each train will be capable of producing 5.2 mtpa. The new facility will be co-located at the site of the existing LNG import terminal owned and operated by Golden Pass LNG Terminal LLC, an affiliate of GPP. The Golden Pass LNG Terminal commissioned its facilities in 2010 by receiving its first ever LNG cargo from Qatar. CB&I and Chiyoda had earlier this year completed the pre-FEED and engineering necessary to support Golden Pass’ formal application to the Federal Energy Regulatory Commission. CB&I performed the engineering and construction of the existing LNG import terminal, which became operational in 2010.

20 > QATAR TODAY > SEPTEMBER 2014

RasGas Company Limited says its total greenhouse gas emissions recorded in 2013 were lower than those documented in the previous year following the implementation of corporate policies and strategies to minimise carbon emissions.

n its Sustainability Report 2013, the company said its emissions last year totalled 17.9 million tonnes of carbon dioxide (CO2) equivalent, as compared to 18.7 million tonnes recorded in 2012. The company said that it continues to minimise carbon emissions from its operations in line with the corporate GHG management strategy and policy that was approved in 2012. The strategy and policy pro-

vided a platform to consider mitigation opportunities along the supply chain and for tackling current and future GHG challenges, the company said. “In 2013, we took actions within our GHG management plan. We benchmarked our programme to identify best practices and areas for improvement and completed a desk review of mitigation opportunities,” RasGas said in the report.

business > realty check TWO TOWERS IN WEST BAY FETCH QR1.5 BILLION

Two towers in the posh West Bay area of the city were sold for a staggering QR1.5 billion late last month. The transactions took the total value of real estate deals concluded in a week to an all-time high of QR2.76 billion.

eal estate registration details for the week between July 20 and 24 show that one of the towers, measuring 3,126 square metres in Al Dafna, was sold for QR1 billion. This is one of the highest values recorded for a real estate deal in Qatar’s known history, market observers say. The second tower, also in Al Dafna, was sold for QR500 million. Registration details put its area at 4,056 sq metres and described it as a residential high-rise. Al Dafna is part of the sprawling West Bay area and is often called Qatar’s mini-Manhattan as it is dotted with skyscrapers. A total of 151 real estate deals were recorded during the week and most of them

involved small, open plots of land for residential purposes. The week also witnessed the sale of very small houses, details with the Ministry of Justice’s real estate registration department show. One of the small houses, measuring just about 121 square metres and located in expatriate-dominated Al Mansoura area of Doha, was sold for QR2.4 million. Another, a house of 112 square metres in the Najma area of Doha, was sold for QR4.1 million. A third, a small house with an area of 181 square metres in Fereej bin Dirham locality, also in Doha, was sold for QR2.35 million. The smallest of all, a house with an area of 93 square metres and located in Fereej bin Omran, was sold for QR1.55 million.

QATAR-OWNED 5-STAR HOTEL OPENS IN PARIS Peninsula Paris Hotel, owned by Katara Hospitality and the Hong Kong and Shanghai Hotels, opened its doors in Paris on August 1, becoming the French capital’s latest fivestar hotel. AFP PHOTO / FRED DUFOUR Katara Hospitality and the Hongkong and Shanghai Hotels spent £600 million (QR3.66 billion) on the project, buying the building from the French Foreign Ministry, which had taken it over after World War II when it served as the German army headquarters. While Paris - one of the world’s most-visited cities - has fewer five-star hotels than New York or London, the market is heating up with several new and renovated hotels set to open by 2016. 22 > QATAR TODAY > SEPTEMBER 2014

RULING FAMILY KEEN ON GHERKIN TOWER? Qatar’s ruling Al Thani family is reportedly in talks to buy London’s Gherkin tower and a massive Frankfurt Airport office complex for a combined $2.05 billion (QR7.46 billion).

he properties are owned by insolvent German company IVG Immobilien AG (IVG), which is seeking to sell off equity to pay down $4.2 billion (QR15.28 billion) worth of debt accumulated during a massive expansion. The Frankfurt office block, The Squaire, has a price tag of $1.1 billion (QR4 billion), while the Gherkin is worth $939 million (QR3.417 billion), according to Property Investor Europe magazine. The 40-storey Gherkin skyscraper was put up for sale last week, with the landmark building expected to attract interest from around the world, joint agents Savills and Deloitte Real Estate said. Co-owner Evans Randall said in April it was ready to invest further, but was unable to agree a new financial structure with IVG.

news bites > regional

24 > QATAR TODAY > SEPTEMBER 2014

G U N S A N D ROS E S An Iraqi Kurdish Peshmerga fighter plays a musical instrument on the front line in Khazer, near the Kurdish checkpoint of Aski Kalak, 40 km west of Arbil, the capital of the autonomous Kurdish region of northern Iraq, on August 14. AFP PHOTO/SAFIN HAMED

QATAR TODAY > SEPTEMBER 2014 > 25

development > viewpoint

CHINATOWN IN ARABIA

A peek into the new era of engagement heralded by China’s growing interests in the Middle East.

ver the last decade, China has sought to safeguard and diversify crucial energy and commodities supplies needed to sustain its long-term economic growth cementing its relationship with the Middle East. From developing some of the world’s biggest oil fields in Iraq to constructing a large-scale refinery at Saudi Arabia’s Red Sea coast – Chinese companies are broadening their footprint across the region, channeling billions of dollars into sectors such as energy and commodities. The energy needs of China and the Middle East region are closely intertwined. On an industry level, it paves the way for a new breed of Chinese energy companies – characterised no longer by low-cost and sub-standard quality and service offerings, but by considerably upgraded technological, human and financial capabilities that play a much greater role in a sector that in the past was almost exclusively dominated by Western firms, in particular international oil companies (IOCs). On a political level, China’s deepening engagement in the Middle East provides the world’s second-largest economy with long-term access to strategic hydrocarbons and other raw materials, while at the same time opening up downstream opportunities for producing countries seeking to cement relationships with their customers and ensure long-term demand security. It is also strengthening bilateral relations between regional governments and China, thus adding a new strategic dimension to the region’s political dynamics that may have greater weighting in the aftermath of the Arab Spring. Competitive posture China’s increasingly competitive posture in the region’s energy sector was highlighted most recently by the April announcement that state-owned China National Petroleum Corporation (CNPC) had agreed a landmark deal with Abu Dhabi’s

26 > QATAR TODAY > SEPTEMBER 2014

government, granting it access to produce and export crude oil from several onshore and offshore fields in the emirate, the first of its kind for a Chinese company in the Gulf state.

China’s desire to ensure the security and reliability of its internationally-sourced energy and raw material supplies is understandable considering that China, which in September 2013 became the world’s largest net importer of crude oil and other liquids, is projected by the Energy Information Administration to consume more than twice as much energy as the U.S. and more than three times as much as India by 2040. It is driven by a mix of steady economic growth and rapidly rising petroleum demand that outpaces production growth in the Asian country, whose population will rise to about 1.38 billion by 2015 from an estimated 1.34 billion in 2010. According to Edinburgh-based energy consultancy Wood Mackenzie, China’s thirst for energy means that the country will have to spend as much as $500 billion per year by 2020 on crude oil imports alone.

As China keeps growing, its dependence on energy imports from the West Asia region will continue. As a result, more Chinese investments are likely to be directed at opportunities in the Middle East energy sector, whether up-, mid- or downstream.

CHINA LNG IMPORT SOURCES, 2012

QATAR 34%

YEMEN 4%

MALAYSIA 13%

NIGERIA 2% TRINIDAD 1% RUSSIA 3% EGYPT 2%

INDONESIA 16% AUSTRALIA 24%

OTHERS 1%

Shipments of liquefied natural gas (LNG) have also increased significantly since China became a net natural gas importer for the first time in 2007. According to the Energy Information Administration, shipments into China jumped by 25% to about 880 billion cubic feet (bcf) last year from 706 bcf in 2012 and 581 bcf in 2011. The country now roughly consumes 6% of the global LNG trade, and ranks as the world’s third-biggest LNG importer. Future demand for the clean-burning fuel will rise further, driven by the need to alleviate high pollution resulting from China’s heavy coal use.

With gas demand on the rise, China has sought to diversify its import sources geographically and entered into long-term LNG supply contracts with Qatar, Yemen and Oman, as well as Egypt, Algeria and Nigeria, which together accounted for more than 42% of total LNG imports in 2012. In addition, gas will be piped in from Russia from 2018. In the future, these deals will be expanded on, certainly in light of the government’s recent announcement that it severely cut its outlook for shale gas production by 2020 after it emerged that the process will be more expensive than previously expected.

ENERGY CONSUMPTION IN THE UNITED STATES, CHINA AND INDIA 1990 - 2040 2010

HISTORY

250

PROJECTION

200

BY SEAN EVERS

150

CHINA

100

Managing Partner Gulf Intelligence

UNITED STATES

50 INDIA 0 1990

2000

2010

2020

Historic ties Once reflected in flourishing trade along the old Silk Road, the historic ties between China and the Middle East are again flourishing. Trade between China and the energy-rich six-member Gulf Cooperation Council (GCC) states in particular has jumped. From a total trade volume of $12 billion in 2003, China-GCC trade rose to $155 billion in 2012. China is now the GCC’s largest trading partner ahead of the U.S., while Saudi Arabia has been China’s largest trading partner in Western Asia and Africa over the past 10 years. At the same time, the GCC countries, as a group, have become the largest oil supplier to China, meeting about 35% of its total crude oil requirements in

CHINA'S CRUDE OIL IMPORTS BY SOURCE, 2013 BRAZIL 2% CONGO 2% KUWAIT 3%

OTHERS 12%

SAUDI ARABIA 19%

UAE 8% KAZAKHSTAN 4%

ANGOLA 14%

VENEZUELA 6% IRAQ 8% OMAN 9%

RUSSIA 9% IRAN 8%

2030

2040

2012. China has also stepped up its regional investments in key sectors such as energy, metals and infrastructure. According to the latest figures of China’s worldwide investments between the years 2005 and 2013 available via the Heritage Foundation’s tracker, the country’s companies invested a total $48.8 billion in various sectors across the Middle East-East Africa region during that period. Iraq accounted for the largest share of Chinese investments during the period, with $10.1 billion channeled into oil projects in the country, ahead of Iran, Egypt, Mozambique and Saudi Arabia. While these investments are based on commercial considerations, they clearly serve a broader strategic interest. On the one hand, outward investments by Chinese NOCs are a way of building and deepening strategic relationships with oil and gas-producing countries as a means of ensuring energy security; on the other, they also represent an opportunity to build up technical know-how and develop human skills through entering into partnerships with other National Oil Companies (NOCs) such as Saudi Aramco or IOCs such as BP. Moreover, Chinese NOCs’ partnerships with or acquisitions of other industry players are enabling them to develop expertise in previously unchartered territory such as deepwater or unconventionals. To this end, the China National Offshore Oil Corporation in 2013 spent $15 billion on Canadian upstream oil and gas firm Nexen, whose business includes oil sand and shale gas plays. CNOOC is also working with Total in Nigeria’s Akpo and Egina deepwater fields. As Chinese companies are position-

ABOUT GULF INTELLIGENCE Gulf Intelligence facilitates knowledge exchange and networking between stakeholders in the Energy, Healthcare and Banking & Finance sectors across the Gulf region. The strategic communications firm, headquartered in Dubai and operating in Qatar and Oman, prepares and positions clients as Thought Leaders in their industry utilising a range of dynamic platforms that ensure a direct and tangible engagement with stakeholders. www.thegulfintelligence.com.

ing themselves to play a greater role in the global energy sector, including in the Middle East, China’s outbound energy investments are expected to be increasingly counterbalanced by investments from the likes of Saudi Aramco, Qatar Petroleum and Kuwait Petroleum Corp., all of which are already involved in one way or another in refining and petrochemical projects in the Asian giant. For energy producers in the Middle East this symbiosis will be essential in their strategy to secure long-term demand security, in particular for their heavy crude grades, amid an increasingly energy-independent U.S. and rising energy export flows out of North America. The new era of an old relationship between China and the Middle East may have just been rekindled, but like the bygone era of millennia past it will need to be a clear win-win framework to underpin the 21st century partnership QATAR TODAY > SEPTEMBER 2014 > 27

business > viewpoint

PRIVATE BANKS

MUST CHANGE TACK

All across Asia, Africa and the Middle East, successful business owners are growing their wealth rapidly on the back of burgeoning trade and consumer spending. To private banks, these emerging market entrepreneurs represent a potentially huge new client segment, but to serve them, we must do things a little differently.

BY MICHAEL BENZ

“To best serve emerging market entrepreneurs, private banks will increasingly need to be able to provide advice on succession and wealth planning, as well as steps to improve formal governance and management structures – alongside the more traditional private wealth management offerings.” 28 > QATAR TODAY > SEPTEMBER 2014

irst of all, to many of first-generation emerging market business owners, there is no such thing as “private” wealth. Typically, they are heavily involved with the dayto-day running of their company, and will reinvest any spare cash into the business. A recent report we commissioned on high-net-worth business owners in Asia, Africa and the Middle East, confirms this clear tendency to put business before wealth. Most of the around 60 entrepreneurs we interviewed did not have a strategy for growing their personal wealth. “I’ll think about it when the time is right,” as one of them commented. What was striking about our survey, conducted by Campden Research, was the degree of similarity between the entrepreneurs. Whether in the UAE, Nigeria, India or China, the majority were firmly focussed on the needs of the business, with personal wealth featuring much lower down on the agenda. This is in stark contrast to the West where businesses tend to be older and more established, and the assets of the business and the owner therefore more clearly divided.

The findings suggest that a huge and rapidly growing client segment for private banks – cutting right across emerging markets – cannot necessarily be reached with traditional private wealth management products, or at least not in the first instance. An emerging market entrepreneur is a lot more likely to come to the bank looking for a business loan than a wealth fund. For private banks, there is one obvious answer to that: add commercial banking to your offering and start providing business finance. That’s what we’ve done at Standard Chartered, creating a combined private and commercial banking segment that allows us to serve high-net-worth business owners seamlessly as their businesses grow. The second important difference to note is that most emerging market entrepreneurs don’t have clear strategies for succession planning. Formal management and governance structures, such as the inclusion of non-family members on the board and senior management team, help when the time comes to transfer the business to the next generation, or to an external buyer. However, in our recent study, high-networth business owners in Asia, Africa and

PRIVATE WEALTH IN THE MIDDLE EAST AND AFRICA IS LIKELY TO GROW TO AN ESTIMATED

QR23.7

TRILLION BY THE END OF 2017,

the Middle East attached a relatively low importance to formal planning for the succession or future strategic agility of their businesses. Some were skeptical about the need for external managers to help their businesses grow. As one high-net-worth family business owner commented, “Family members are more likely than external advisors to care about and nurture the business.” These findings suggest an implicit, if often unidentified, need for advice among emerging market business owners, as their businesses expand and their wealth accumulates. We’ve identified increasing need for this among our own clients in the last few years. To best serve emerging market entrepreneurs, private banks will increasingly need to be able to provide advice on succession and wealth planning, as well as steps to improve formal governance and management structures – alongside the more traditional private wealth management offering. In particular, a new trend has emerged in recent years leading to the crafting of increasingly sophisticated and flexible succession planning structures to accommodate client family international needs and requirements. What should be clear to everyone is, at least, that the wealth creation of this group of clients will continue to grow rapidly and become much more important to private

banks everywhere. The World Trade Organisation predicts that so-called southsouth trade – trade between emerging markets – will more than double to 43% of total world trade by 2035, lending considerable support to entrepreneurs across Asia, Africa and the Middle East. And further momentum will come from urbanisation, technological innovation and a growing middle class boosting domestic spending. This year, Asia is expected to become the world’s largest high-net-worth wealth market, with the region predicted by Boston Consulting Group to account for almost three-fifths of the global growth in wealth in the next three years. Meanwhile, private wealth in the Middle East and Africa is likely to grow to an estimated $6.5 trillion (QR23.7 trillion) by the end of 2017, with most of the increase coming from new wealth creation in oil-rich economies. This implies a very significant shift in the private banking market towards these regions. All successful private banking relationships start with the client and what the client wants to do. Considering that much of the wealth now being created in emerging markets is linked to family businesses, it’s time for private banks to adapt. The guiding principle is very simple – if you want to bank the owner, bank the business

MICHAEL BENZ Global Head, Private Banking Clients Standard Chartered Private Bank

QATAR TODAY > SEPTEMBER 2014 > 29

business > viewpoint

MEDICAL INDUSTRY

GETS A SHOT IN THE ARM

A brief look at Qatar’s medical manufacturing sector which is on course to expansion and the factors impacting it.

ising demand for healthcare combined with the graduated introduction of the National Health Insurance Scheme (Seha) are set to boost Qatar’s nascent pharmaceuticals and medical products segment. Healthcare spending in Qatar and across the Gulf region is projected to maintain strong growth for the foreseeable future, as populations increase and as non-communicable diseases generally associated with more sedentary lifestyles become more prevalent. There are fewer than 50 manufacturers in the GCC producing medicines and pharmaceuticals and only a handful of firms focusing on medical devices and technology. Two such companies operate in Qatar, though this could change as domestic and regional demand rises, with reports suggesting that pharmaceutical sales alone in Qatar will rise 7-10% annually until the end of the decade. Compulsory insurance scheme to drive growth The sector will also receive a shot in the arm from the new healthcare scheme. The programme, which is being implemented in three stages, will see all Qatari citizens and expatriates provided with comprehensive health coverage by 2015. According to Faleh Mohamed Hussain Ali, acting CEO of the National Health Insurance Company, which is responsible for operating Seha, the programme is in its second stage. Coverage for all Qatari nationals’ basic healthcare needs was rolled out at the end of April. Ahmed Mohammed Al Sulaiti, chairman of Qatar Pharma, is hopeful the

30 > QATAR TODAY > SEPTEMBER 2014

national health insurance scheme will not only support sales, but also encourage others to invest in the local production of medical devices, equipment, drugs and other products. Even with the scheme in its early stages, sales and activity in the sector are growing, he told OBG. “We have already seen a noticeable increase in orders coming from Hamad Medical Corporation so this should be an indication that the amount of goods being consumed in the healthcare industry is on the rise,” Al Sulaiti said. State support for expansion The government is offering a range of incentives to prompt more local firms to break into this expanding market. As part of Qatar National Vision 2030, the state’s blueprint for social and economic development, increased support is being given to encourage the growth of industries not dependent on hydrocarbons. Along with chemical, metallurgical, eco-friendly and high-tech industries, pharmaceuticals and health-related services have been identified as areas where there are significant investment opportunities for small and medium-sized businesses. In late June, the minister of energy and industry, HE Dr Mohamed bin Saleh Al Sada, announced that the state would be offering incentives to investors in pharmaceuticals and other identified sectors, including tax holidays, exemption from export tariffs and funding support through the Qatar Development Bank. Regional competition While government support for the sector may encourage more entrants, the market is already tight. Competition from

regional and international manufacturers is one factor limiting the broadening of the health and medical supplies sector in Qatar. According to Emre Anlar, CEO of local equipment and device producer Qatari German Medical Devices, domestic firms are under pressure from both ends of the market. “We are facing severe competition from the big companies that have an established brand name, as well as from the low-cost producers from emerging markets,” Anlar told OBG. Across the GCC, imports account for more than 90% of pharmaceuticals, equipment and medical devices, despite the increase in local production, with most products sourced from the US or European suppliers, according to Al Sulaiti. Even with the growing opportunities presented by the Seha, Qatar is likely to remain a relatively small market, with manufacturers focusing largely on external sales. Most local pharmaceuticals and medical device production - up to 90% in the case of some lines - is exported. Saudi Arabia is the leading market, accounting for around 60% of all sales in the region

BY OLIVER CORNOCK The author is the Regional Editor of Oxford Business Group.

news bites > world view

D E AT H B E T H Y N A M E An MSF medical worker checks their protective clothing in a mirror at an MSF facility in Kailahun, on August 15. Kailahun, along with Kenama district, is at the epicentre of the world's worst Ebola outbreak. The World Health Organisation (WHO) revealed that the latest death toll from the Ebola virus in Guinea, Sierra Leone, Liberia and Nigeria had claimed close to 1,500 lives. Health organisations are looking into the possible use of experimental drugs to combat the latest outbreak in West Africa. AFP PHOTO/Carl de Souza 32 > QATAR TODAY > SEPTEMBER 2014

QATAR TODAY > SEPTEMBER 2014 > 33

business > listening post

THE VOICE OF HER

GENERATION

BY AYSWARYA MURTHY

In an exclusive chat with the dynamic young CEO of Qatar Business Incubation Centre, Aysha Al Mudahka, Qatar Today unravels her plans for the ambitious new organisation now under her direction.

34 > QATAR TODAY > SEPTEMBER 2014

he last time we were at QBIC, it looked forlorn and there was barely a soul in sight. The 10-week Lean Startup Programme had just concluded and the selected incubatees were enjoying a well-deserved break before taking the big plunge. But just a month later, QBIC seems to have shaken off the blanket of sluggishness that usually envelopes this part of the world during Ramadan. Visible changes might be subtle, but the undercurrent is unmistakable. A group of young men are unpacking boxes in QBIC's Showroom. In the Genius Room, an open notepad awaits the return of its owner. The stark, empty office spaces of a few weeks ago have now been filled – here, someone has a personal picture on their desk; there, a new couch has been installed, set to welcome friends and clients alike. The cavernous atrium which previously had echoed with the sound of our footsteps is now filled with

that of furious typing and the smell of fresh java. The official announcement of Aysha Al Mudahka’s new role at QBIC had come only a few days ago, and as we arrive, she is conferring with a young, serious-faced incubatee. A prominent fixture of Qatar’s entrepreneurial ecosystem over the past few years, Al Mudahka looks like she is in her element. And why wouldn’t she be. Prior to joining QBIC, Al Mudahka had famously co-founded the Roudha Centre, which focuses on fostering entrepreneurship among women, and served as the Executive Director at INJAZ Qatar which was “preparing the youth to be part of the global economy by providing hands-on and practical programmes on entrepreneurship, work readiness and financial literacy.” This also involved connecting students with corporate volunteers who mentored and supported them, and Al Mudahka is deeply familiar with both sides of the coin.

“Since its inception, INJAZ has reached out to over 15,000 students and expanded the entrepreneurship pillar with a startup programme,” she says. Roudha Centre too provided some rudimentary incubation services but never before had she had the resources in the scale that are now at her disposal. “Here at QBIC I have everything that I found challenging before – from facilities to financing – so I don’t have any excuses now,” she laughs. Her stint at QBIC is a culmination of a life-long passion for development and entrepreneurship that started at the very beginning of her career, when she was working at the Qatar Financial Centre. “I was part of the business development team that handled insurance and reinsurance companies who wanted to set up in Qatar. So that’s how it all started, with me looking at business plans, going over histories of the global companies that were applying to be part of QFC and poring over feasibility studies.” Not long after that, her B-school experience abroad reaffirmed what she already knew – that she wanted to focus on youth development, whether in the personal or entrepreneurial spheres. “It has always been my dream to sit in a physical location like this which can serve as a one-stop shop for businesses looking to start-up. So when the opportunity came to be part of QBIC, I grabbed it. Of course, it’s going to be a big challenge,” she admits. “It’s a national responsibility and I am ready and willing to take it on. I am so excited about our promise to fulfill the needs of our entrepreneurs to every possible extent – office spaces, workshops, smart financing and whatever support they may need in terms of education.” QBIC’s 17 incubated teams have now all signed their agreements, decided on their milestones, and started working towards them, Al Mudahka says. “The workshops are in the process of being set up and we are also on the verge of signing a couple of high-profile partnerships.” She doesn’t go into the details, save for hinting that QBIC anticipates big support for their corporate incubation zones. “We are happy to lend our partners the use of our facilities to incubate their companies and meet their goals and visions. They’ll be our key stakeholders in the days to come,” she says. For corporations incubating smaller companies, the centre can offer state-of-the-art facilities, networking opportunities, coaching from veteran entrepreneurs, production workshops and the chance to exchange ideas with fellow entrepreneurs and be part of

The myriad for facilities available to entrepreneurs on QBIC's premises.

the hub, according to Al Mudahka. For someone who has been part of the ecosystem for so long, it must be a special treat to witness just how far things have come along. “Since I became actively involved in entrepreneurship in 2008, many milestones have been achieved and several key initiatives taken. There is a lot of collaboration among the different entities, and the interest among young entrepreneurs and business owners is growing,” she says. There had never been a lack of organisations that sought to promote entrepreneurship in Qatar but it always seemed like there needed to be a more coordinated effort. Al Mudahka believes that this synergy is starting to happen. “There are plenty of opportunities for all of us to collaborate and we want to be the entrepreneurial hub of Qatar, bringing all the players together to deliver the best possible opportunities for Qatari startups,” she says. There are still some major hurdles to overcome, however. “Primarily, I feel there is a lack of knowledge among entrepreneurs about where to go and what to do, and financing remains one of the biggest challenges. On the policy level, the lack of bankruptcy law is a problem and so is the high operational expense of opening a business in Qatar,” she opines. And the effort to influence policy changes is a vicious circle. “Unless I can produce evidence of a visible trend and an emerging breed of entrepreneurs whose needs are different, how can I justifiably ask for any kind of changes?” she asks. Despite all this and despite the strong pull of public sector jobs, Al Mudahka feels

all the youth need to start down the entrepreneurial path is a little nudge. “I always ask young people wouldn’t they rather make money for themselves than for others? We should let them know that this is possible, show them the appeal of being their own boss and doing the things they want to do in life towards fulfilling their goals and dreams.” QBIC’s own Speaker Series aims at promoting entrepreneurship through inspiration in the community, she points out. “Every year, the interest surrounding startups grows and I am really looking forward to being part of this ecosystem. Social entrepreneurship is particularly close to my heart and I’d like to work more towards identifying and promoting such ideas,” she says, while proudly talking about a couple of startups in the current batch of incubatees with a focus on social innovation and sustainability. “There is a market for it, they just need the right support.” she says confidently. While she says she is still getting the hang of things around QBIC, her goals have been crystal clear from the beginning. “When QBIC launched we promised to create the first QR100 million company and that’s what I will be devoting all my energy towards. Our focus will remain on supporting startups and scale ups in Qatar, creating the right ecosystem for our entrepreneurs and providing them with a longterm support system through QBIC and, most importantly, developing our youth to become leaders of the current generation by helping them pioneer in their areas of interest,” she says QATAR TODAY > SEPTEMBER 2014 > 35

business > listening post

LAYING DOWN

THE LAW

Legal eagle and Managing Partner at Eversheds Qatar Dani Kabbani gives an insight into Corporate Law 101. BY AYSWARYA MURTHY

uried inside society’s subconscious, lawyers are remembered only when cracking cheeky jokes, watching Suits or, God forbid, you are in trouble. Corporate lawyers are even more invisible; seldom seen or heard from, and relegated behind closed doors and buried beneath mountains of paperwork; paperwork that constitutes the foundation of every move a business makes,

36 > QATAR TODAY > SEPTEMBER 2014

big or small. Forget the front pages of a tabloid; the mettle of a corporate lawyer lies in never having to represent his client in court. It lies in crafting iron-clad contracts that leave no wiggle room. Dani Kabbani, who has been practising law in Qatar since 1997 (and in Lebanon before that), is perfectly positioned to give us a peek into the goings-on of the swanky boardrooms that this mysterious species inhabits. After helping set up Doha Bank’s legal department from scratch 17 years ago (when

he was all of 24 years old), Kabbani knew that if he was to thrive in Qatar he had to grab a seat on the oil & gas express. As part of Qatar Petroleum’s legal team, he drafted and negotiated project and finance documents for some of the energy goliath’s mega deals – worth billions of dollars, requiring one or two years just to finalise on paper and taking him around the world from Kuala Lumpur to Houston and London to Johannesburg. In fact his name was recently put forward as a candidate for the post of

Minister of Energy in the recently formed Lebanese government. Now as a private practitioner and the managing partner at Eversheds, Kabbani deals with clients as varied as QatarGas, Qatar Satellite Company, Boeing and Microsoft – some who tap into his firm’s international expertise and others who seek his extensive knowledge of the local legal system. “The devil is in the details” It all begins and ends with the contract, he says. Unsurprisingly, most of the disputes in Qatar concern the construction industry – from delayed delivery to questionable quality of materials. And while a dispute is never good news, in Qatar it’s doubly so, considering the scale of the projects and the nature of the entities involved – from government bodies to international companies from every corner of the globe. “That’s why jurisdiction and dispute resolution clauses are an important yet tricky part of the negotiation,” he says, “And because it’s often the last article in the contract to be looked at, not enough thought goes into it.” This is where both parties agree on the applicable law and if disputes are to be resolved by arbitration or litigation at a later stage. “Parties will often look for a neutral jurisdiction, unrelated to either. So a Qatari and an American entity entering into a contract will choose to settle their disputes through arbitration in Paris, for example.” At this point, they also agree upon whether the dispute will be subject to Qatari, New York or perhaps English or French Law. “If not properly drafted, these clauses can become ambiguous and then there could be a dispute to decide how the dispute will be resolved!” he shakes his head. Though traditional wisdom would suggest that arbitration is the lesser evil of the two, it’s not a walk in the park either. “Once the arbitration panel is nominated, the case deliberated on (more often than not at institutions like the International Chamber of Commerce or the London Court of International Arbitration) and awarded, the actual fun part starts,” he says sarcastically, “because enforcing the arbitral award is a lengthy process that could be even more complicated than the case itself.” If you win against, say, a Singaporean company, you’ll need to go after its assets, which are most likely in the home country. “Normally you go where the money is. So you’ll have to head to Singapore and go through another (local) court process to enforce the judgement!” Which is why, he reiterates, their role in drafting the most precise and clear

contract is key. Whole teams of legal brains pore over the fine print to ensure that a dispute, if it comes to that, is over a situation that has precipitated and not the contract itself. A careful vetting of these contracts becomes more critical when you consider the resource crunch in Qatar that all entities seem to be quietly preparing for. “We find ourselves advising companies more and more on how to draft their agreements to counteract the issues of inflation and availability of resources. There’s fierce competition among international companies to do business in Qatar and we see a few submitting tenders way below what the pricing should be. This will definitely lead to an agreement breach as contractors rely on variations to make-up for the difference in price. And this is not a concern just for contractors but also for the government. Building a part of the estimated overspend into the contract as incentives and taking a more balanced approach to the process, by agreeing to revisit agreements, is more likely to result in a win-win situation,” Kabbani says, pointing out how the firm has recently started bringing together construction companies and entities like Ashghal through seminars and conferences to work together in drafting an ideal agreement. The evolution of Qatari laws Increasingly, he says, a lot of international companies are accepting Qatari jurisdiction “as it has evolved over time and proved itself to be at par with others in the region”. And he can give us a first-hand account. “Until 2004 there was only one code which dealt with both civil and commercial law and there was no section on bankruptcy. The Civil Code was promulgated in 2004 followed by the Commercial Code in 2006” he says. Laws are always a reaction to a certain need in society and Qatari legislators have done a good job in recognising and anticipating gaps, and drafting laws for the same. “Because of the construction boom that started prior to the 2006 Asian Games, there was a major influx of foreign investors. The general rule about a 51% Qatari ownership for any business operation in the country was relaxed to allow foreign companies to set up local branches and tender for major government and semi-government projects.” The branches would be set-up only for the duration of the specific project and the companies aren’t allowed to work with non-government entities but it nonetheless opened the doors for some of the biggest global names

QE IS THE PLACE TO BE KABBANI HAS A SPECIAL PLACE IN HIS HEART FOR THE QATAR EXCHANGE HAVING WORKED WITH QATAR HOLDING ON ITS JOINT VENTURE WITH NYSE EURONEXT. WHEREVER POSSIBLE, HE AIMS AT ENCOURAGING MORE COMPANIES TO LIST ON THE EXCHANGE, AND ADVISING COMPANIES ON IPO AND RIGHTS ISSUE IS AN IMPORTANT ASPECT OF THE FIRM’S SERVICES (EVERSHEDS HAS BEEN HELPING BARWA BANK WITH THEIR UPCOMING IPO). WITH THE MSCI UPGRADE AND THE GOVERNMENT’S DECISION TO ALLOW FOREIGN INVESTMENT OF UP TO 49% IN LISTED COMPANIES, THE TIMING IS PERFECT FOR MORE QATARI INSTITUTIONS TO BECOME PART OF THE EXCHANGE, HE FEELS. “PARTICULARLY FAMILY BUSINESSES, WHICH IN QATAR SPAN MANY MAJOR INDUSTRIES AND ARE NOW MOVING AWAY FROM THE PASSIVITY OF THE 90S (WHEN THE INTEREST WAS MAINLY IN SPONSORING FOREIGN COMPANIES) TO PLAY A MORE PROACTIVE ROLE BY EXPANDING BEYOND THE COUNTRY’S BORDERS. KABBANI HAS ADVISED GOVERNMENT ENTITIES AND PRIVATELY OWNED COMPANIES IN MERGING WITH AND ACQUIRING OTHER COMPANIES IN AFRICA, CHINA AND EUROPE” HITHERTO, FAMILY-OWNED BUSINESSES HAVE LARGELY RESISTED LISTING ON THE EXCHANGE. “THEY ARE OFTEN CONCERNED ABOUT MANAGEMENT RESTRUCTURING, SUBJECTING THEIR BUSINESSES TO THE RULES AND REGULATIONS (AND THE PENALTIES) THAT COME WITH BEING REGULATED BY THE EXCHANGE AND OPENING UP THEIR BOOKS AND PRACTICES TO COMPLIANCE OFFICERS,” HE SAYS. BUT THE ADVANTAGES OUTWEIGH THE “INCONVENIENCES”. “IT’S A FANTASTIC OPPORTUNITY TO RAISE FINANCE, GAIN ACCESS TO OTHER MARKETS AND ATTRACT TOP TIER TALENT,” KABBANI SAYS. BUT IT WILL TAKE TIME AND EDUCATION, HE CONCEDES. QE IN ITS EFFORTS TO ENCOURAGE LISTING IS WORKING ON A GUIDE HE HELPED AUTHORING THAT GIVE DETAILS ABOUT THE LISTING PROCESS, THE BENEFITS, REQUIREMENTS, ETC. WHICH, HE HOPES, WILL MAKE THE PROCESS MORE TRANSPARENT.

in construction. “The government further diversified foreign investment was successful in attracting major names by setting-up the Qatar Financial Centre (limited to financial sector companies) and the Qatar Science and Technology Park (for entities with a research and development focus) where 100% foreign ownership was permitted and the deal sweetened still with tax exemption in the case of QSTP.” The state went further with the Foreign Investment Law that allowed certain “Priority Sectors” to be exempt from the ownership QATAR TODAY > SEPTEMBER 2014 > 37

business > listening post rule. Though this is handled on a case-bycase basis and is subject to final approval from the Ministry of Business and Trade, a diverse range of sectors falls under this category – agriculture, tourism, education, energy, consultancy, IT, sports, culture, entertainment. “This opening up of the legal system and setting up of commercial zones show a forward-thinking vision that has worked extremely well in attracting foreign investment and talent, and enabled the knowledge transfer that is so crucial to Qatar’s long-term plans,” Kabbani says. And while we are on the subject of changing times and laws that change with them, we ask him to weigh in on the will-they-orwon’t-they upgrade the existing Commercial Companies Law, specifically rules concerning the minimum capital requirement for companies. “I have been personally involved in looking into and commenting on the drafts of the new Commercial Companies Law and there were discussions about reducing it or removing it completely,” he says, hinting that possibly no significant change might come to pass in this regard. But he feels this shouldn’t concern people as much as it does. “While there isn’t a right or wrong answer when it comes to this issue, the minimum capital isn’t as high when compared to many other jurisdictions and in certain countries where this prerequisite was discarded, many companies were set up on paper alone; not-so-serious players entered the scene and the business ecosystem became difficult to control.” Furthermore, he adds, unlike other jurisdictions where the capital may not be withdrawn for a certain period of time, in Qatar this capital is flexible and once the legalities are taken care of, one can withdraw the funds for use in the business. Besides, the government has already started to do what it needs to encourage SMEs by providing specially-tailored loans and consultancies, he says. But that doesn’t mean there is no room for improvement in the law. “One of the main regulations I’d like to see changed is the one governing agencies (who may be representatives of international manufacturers like car dealerships or distributors of industrial products, for example). Currently, commercial agencies are addressed in both the Commercial Law and the Commercial Agencts Law, which leads to ambiguity and different interpretations. This needs to be clarified.” Transparency is key Kabbani understandably sidesteps the question about which country’s legal sys38 > QATAR TODAY > SEPTEMBER 2014

LOST IN TRANSLATION CONTRACTS DO NOT HAVE TO BE DRAFTED IN ARABIC AND THEY ARE OFTEN DRAFTED IN ENGLISH IN QATAR. HOWEVER IF DISPUTES ARISE AND ARE TO BE DECIDED BY THE QATARI COURTS, ALL CONTRACTS, CORRESPONDENCE AND DOCUMENTS WILL NEED TO BE TRANSLATED INTO ARABIC. ENGLISH LAW CONTRACTS ARE OFTEN COPIED AND USED IN QATAR WITHOUT REAL CONSIDERATION OF THE WAY QATARI LAW WOULD TREAT THE CONCEPTS WHICH MEANS QATARI COURTS CAN TAKE A VERY DIFFERENT VIEW FROM WHAT THE PARTIES INTENDED. THERE ARE NO OFFICIAL TRANSLATIONS OF QATARI LAWS INTO ENGLISH THEREFORE HIGHLY QUALIFIED BILINGUAL LAWYERS AT INTERNATIONAL LAW FIRMS LIKE EVERSHEDS HAVE AN IMPORTANT ROLE TO PLAY. WHILST OBTAINING LEGAL ADVICE IS OFTEN SEEN AS A DELAYING FACTOR WHEN RUSHING TO CLOSE A TRANSACTION, IT CAN BE CRUCIAL TO ENSURE THAT THE PARTIES ARE GETTING THE DEAL AND PROTECTION THEY WANT.

tem he considers near-ideal. “It’s not about the laws; it’s about the implementation,” he says. When it comes to Qatari courts, unlike certain jurisdictions, the judiciary and the executive are separated and if the laws may seem to extend a higher level of protection to nationals, “it is not to the detriment of foreigners”. Transparency, however, has some ways to go still. “And this is not due to any intention to hide the legal process from the public,” he clarifies, “but more because of lack of resources.” If we wanted, we could enter any court and sit in all day long to listen to the various cases being fought, he says (except in certain cases where the parties can ask for the hearings to be private), however the issue lies in the number of judgments published. “The Court of Cassation publishes select judgments – a landmark ruling that sets a standard in dealing with certain cases, for example. These serve as an important reference for lawyers and the general public while researching precedents. The Ministry of Justice’s legal portal, Al Meezan, even translates some of these into English. This is commendable work and one that takes a lot of time and effort. This must continue to increase,” Kabbani insists. This process is important for the constant evolution of laws, as lawyers can identify “judgments issued in relation a grey area of the law or an article that is not properly drafted and approach legislators about improving the same”. Some laws, more than others, certainly need to be revisited. We are curious about the concerns of his clients, many of whom are undoubtedly members of the Qatar Chamber of Commerce and Industry, about the long-anticipated changes in the labour

and immigration law. The last we heard, the Ministry of Labour and Social Affairs had submitted the draft of the law to the chamber and was awaiting its recommendations. Does he expect any resistance from the business community? “There is a real intention to improve existing laws to address some of the expectations of the international community,” Kabbani says diplomatically, “The question is just about when.” A new law doesn’t manifest itself in a fortnight and requires diligent consideration of the implications, he contests, especially when it concerns something so sensitive and pervasive. “It will take time to review, to iron out the loopholes and hammer out something that everyone is in agreement on. I can’t say if it’s taking time because there is a consultation with the larger Qatari community. But the chamber represents most of the businesses in Qatar and this process is very important as it is reflective of the real needs and concerns of the local business community,” he says. They are probably most wary about attracting and training talent only to lose them to competitors, he feels. But non-compete clauses, which are pretty boilerplate across companies around the world, just seem more drastic here because of the disproportionate expat population and because being out of a job during the non-compete period most certainly means having to leave the country as expats will need a work permit to remain in the country . Nonetheless, the recommendations, when they come, might most likely concern categorisation according to sectors, according to Kabbani. “Like everyone else, I too am waiting to see what happens.”

affairs > local

QATAR TODAY TOP

40 > QATAR TODAY > SEPTEMBER 2014

PARADISE

REGAINED MOST OF THE COMPANIES LISTED ON QATAR EXCHANGE HAVE HAD A SHINING PERFORMANCE EVER SINCE THE GLOBAL EQUITY INDEX COMPILER MORGAN STANLEY CAPITAL INTERNATIONAL ANNOUNCED LAST YEAR THAT THE BOURSE’S STATUS WOULD BE UPGRADED FROM FRONTIER TO EMERGING MARKET, EFFECTIVE FROM JUNE 2, 2014.

ALSHALL CALCULATIONS FORMULA ON PAGE 46

QATAR TODAY > SEPTEMBER 2014 > 41

QATAR

TODAY

2013

THE QATAR TODAY TOP 1 0 F OR T H E P ERI O D S TA RT ING I N 2009 A N D E NDING I N 2013

WIDAM FOOD COMPANY CONSUMER SERVICES

MASRAF AL RAYAN FINANCIAL

MEDICARE GROUP HEALTH CARE

QATAR FUEL (WOQOD) UTILITIES

INDUSTRIES QATAR INDUSTRIAL

GULF INTERNATIONAL SERVICES CONSUMER SERVICES

NATIONAL LEASING HOLDING CO. CONSUMER SERVICES

QATAR GAS TRANSPORT CO. LIMITED (NAKILAT) INDUSTRIAL

DOHA BANK FINANCIAL

QATAR NATIONAL CEMENT CO. INDUSTRIAL

42 > QATAR TODAY > SEPTEMBER 2014

oncerns over the US Fed’s quantitative easing and political instability in the region, particularly in Iraq and Syria, had some impact but the MSCI announcement proved to be a major boost for Qatar Exchange (QE). Though QE remained rangebound throughout Q1 in 2013, the index rallied in the subsequent quarters, mainly on strong corporate earnings, especially in the industrial and banking sectors, boosting the market sentiment further. Besides strong economic performance, the investor sentiment was also high, which was quite evident with the fairy tale success of the QR3.3 billion Initial Public Offering (IPO) from Mesaieed Petrochemical Holding Company (MPHC) early this year, which was oversubscribed five times. This huge response was a clear indication of the upswing in the investors’ mood and 10 local companies – Masraf Al Rayan, Barwa Real Estate, Commercial Bank of Qatar, Doha Bank, Ooredoo, Qatar Electricity & Water, Qatar Industries, Qatar Islamic Bank, Qatar National Bank (QNB) and Vodafone Qatar - were added to the emerging markets index by the MSCI subsequently. The main stock index of QE was up by 24.17% year-to-date and the market capital of the 42 companies listed on QE as of December 31, 2013 was QR555.6 billion ($152.6 billion). With the addition of MPHC as a listed company early this year, the index rose to 27.42% year-to-date and the market capitalisation stood at QR740.91 billion ($203.55 billion) as of August 11. Market correction In what is viewed as an overdue financial correction, the GCC markets witnessed a market adjustment at the end of Q2 in 2014. The S&P GCC index was off by 1.8% during the quarter, reducing gains from the beginning of the year to 8%. GCC markets’ capitalisation stood at QR3.85 trillion ($1.06 trillion), having shed QR76.44 billion ($21 billion) in the second quarter in 2014. In Qatar, the investors lost a whopping QR21.84 billion ($6 billion) in just three days in June first week due to the deteriorating situation in Iraq and also over fresh allegations that Qatar bribed FIFA officials to host the 2022 FIFA World Cup. Top 10 companies As in the past, Qatar Today, along with ALSHALL Economic Services, a Qatar-based advisory firm providing

different economic, business and corporate finance advisory services to local institutions, which launched in 2004 and maintains since then the first market capitalisation-based index for Qatar, took up its annual exercise of ranking the Qatari companies listed on Qatar Exchange in the financial year of 2013. The top performers came from various industries and seven of the top 10 companies in 2012 were included in the 2013 rankings. The whole process of calculations arriving at the Qatar Today Top 10 has been validated by Deloitte. The top performers in 2013 were spread over various industries. Two of the 10 companies came from the financial sector – Masraf Al Rayan, and Doha Bank – while three others – Widam Food Company, Gulf International Services and National Leasing Holding Co – are from the consumer services sector. Three companies – Industries Qatar, Qatar Gas Transport Company Limited (Nakilat), and Qatar National Cement – are from the industrial sector; Qatar Fuel (Woqod) came from the utilities sector; and Medicare Group, which is from the healthcare sector, was included in the list for the second time since the beginning of the ranking process. Widam Food Company retained the top spot like last year and over took Masraf Al Rayan, which is still ranked second. Medicare Group, which was ranked 6th in 2012, moved up three places and took the 3rd spot in 2013. “We retained the same calculation methodology that we had chosen and used in the previous years, i.e. we just looked at historical performance from an investor’s perspective and tried to answer the question: which companies would have made an investor happier from a financial performance perspective, had the investor bought one share of that company at the beginning of 2009 and sold it at the end of 2013, along with any additional shares received for free during this period,” says Camille Raphael, General Manager of ALSHALL Economic Services. Raphael says in the period leading up to the inclusion of major Qatari stocks in the MSCI index, preceded by the opening up of 49% of their capital to foreign investors, he was reminded of a time a decade ago when QE-listed stocks were first opened up to foreigners. Driven by speculation, stock prices then surged in the period leading up to the day when the decision to allow non-Qataris to invest was enacted, only to be followed by a drop even more substantial than the

WIDAM FOOD COMPANY

45.6%

MEDICARE GROUP

35.7%

33.7%

QATAR FUEL (WOQOD)

GULF INTERNATIONAL SERVICES

21.9%

25.7%

25.1%

23.5%

QATARI INVESTORS GROUP

MASRAF AL RAYAN

NATIONAL LEASING HOLDING CO.

previous increase in price. According to him, one might be tempted to draw parallels and speculate that history may repeat itself once again, but it is hoped that not only is QE today better regulated, more liquid and better capitalised than its old self - the Doha Stock Exchange as it was called then - but also a large portion of new foreign capital this time is likely to be permanent and long-term, characterised by passive fund investment. “The numbers as of June 30, 2014, have not, thus far, solidified the above hopes. The performance of the Qatar Exchange indices during Q2 of 2014, particularly in June, were unfortunately negative and, while these could be partially blamed on high cash and share dividend distributions, on low summer activity or slump in regional markets, the facts remain that ALSHALL index (cap. weighted) finished at 1,444.46 (June 30, 2014) compared with a value of 1,487.06 at the end of Q1 of 2014, and in June alone, ALSHALL index dropped by -14.2% from 1,683.54 at the end of May to 1,444.46 at the end of June,” Raphael says. Added to the share market price appreciation was the amount of cash that the company distributed to its shareholders from its net profits over the period under study, as well as the attractiveness of the company’s shares based on revenue and net profit growth, with the rationale that the value of a company (hence its share price) could potentially increase if the company’s sales revenues and net profits keep increasing extraordinarily year over year. Lastly, liquidity of the stock expressed in terms

27%

20.6%

GULF WAREHOUSING CO.

of average traded volume and number of transactions was taken into consideration, given that if someone would like to exit the investment, he or she should be able to do that easily. For calculations of price per share, cash distributions, net profit and revenue growth, total shares held at the end of 2013 were looked at on the basis of the purchase of one share in that company at the beginning of 2009, and the computations were made on a per share basis. This was done to offset any ownership dilution from corporate actions such as mergers and acquisitions, or capital increases. It should be noted that from time to time, Qatar Exchange-listed companies distribute cash to their shareholders during the year, depending on their previous year’s performance (what is referred to as cash dividends), as well as free share dividends. “We have also decided to measure all financial and trading performance as an average of the five-year period to smoothout extraordinary one-time performances, and assess the listed companies during a period that has seen both boom and gloom,” he says. “ALSHALL has thus calculated the overall top 10 rankings of the companies listed on Qatar Exchange since the beginning of 2009 based on a selection of financial measurements, which may not be the only ones used to assess the attractiveness of a company. It is important to diversify the financial measures to be used in conjunction with statement analysis to achieve a more objective approach in determining a company’s rank in the market as a whole.

AL KHALIJ COMMERCIAL BANK

QATAR NATIONAL BANK

SOURCE: AUDITED FINANCIAL STATEMENTS FOR THE PAST FIVE YEARS

54.5%

(2009-2013), QATAR EXCHANGE AND ALSHALL CALCULATIONS

TOP 1 0 C OM PA N I E S I N TER M S O F P R I CE G RO W TH

“We have also decided to measure all financial and trading performance as an average of the five-year period to smoothout extraordinary onetime performances, and assess the listed companies during a period that has seen both boom and gloom.” CAMILLE RAPHAEL General Manager ALSHALL Economic Services

QATAR TODAY > SEPTEMBER 2014 > 43

SOURCE: AUDITED FINANCIAL STATEMENTS FOR THE PAST FIVE YEARS (2009-2013), QATAR EXCHANGE AND ALSHALL CALCULATIONS

TOP 10 C OM PA N I ES I N T E R MS OF D I VID EN D Y IELD

10.8%

9.0%

7.7%

7.5%

MASRAF AL RAYAN

DOHA BANK

SALAM INTERNATIONAL INVESTMENT LIMITED

WIDAM FOOD COMPANY

7.3%

7.1%

7.0%

6.7%

NATIONAL LEASING HOLDING CO.

COMMERCIAL BANK OF QATAR

DOHA INSURANCE CO.

6.2%

6.0%

QATAR INSURANCE CO.

QATAR ISLAMIC BANK

QATAR INTERNATIONAL ISLAMIC BANK

TOP 10 COMPA N I ES I N T E R MS OF N E T R EV EN U E G RO W TH

QATAR GAS TRANSPORT CO. LIMITED (NAKILAT)

343.7% EZDAN REAL ESTATE CO.

132.5% AL KHALIJ COMMERCIAL BANK

59.6% QATAR GEN. INSURANCE & REINSURANCE CO.

SOURCE: AUDITED FINANCIAL STATEMENTS FOR THE PAST FIVE YEARS (2009-2013), QATAR EXCHANGE AND ALSHALL CALCULATIONS

47.4% 45.4% 43.6%

QATARI INVESTORS GROUP

WIDAM FOOD COMPANY

BARWA REAL ESTATE CO.

42.9% 42.4%

GULF WAREHOUSING CO.

UNITED DEVELOPMENT CO.

40.9% NATIONAL LEASING HOLDING CO.

28.7%

44 > QATAR TODAY > SEPTEMBER 2014

Net profits and revenues of QE-listed securities The value of net profits of listed companies at the end of 2013 came to QR 41,02,030,545. This represents an increase of 9.9% compared to the value of net profits of companies at the end of 2012, which was QR 37,487,675,024. The consumer services sector’s net profits increased by 37.2% compared with last year’s figure. The financial sector saw its net profits registered an increase of 19.3%, while the net profits of the industrial sector decreased by 5.6%. The top five leading companies in terms of net profits growth during 2013 were: Qatar General Insurance & Reinsurance Co., which saw an increase of 1,117.4% in net profits, followed by Ezdan Real Estate Co (289.4%), Mazaya Qatar Real Estate Development (113.3%), Medicare Group (99.7%) and Al Meera Consumer Goods Company (85.5%). The value of revenues of most QE-listed companies for 2013 was QR 153,699,715,854 which represents an increase of 15.5% compared to the value of revenues for 2012 (QR 133,103,912,323). The financial sector recorded an increase of 28.4% in revenues, the consumer services sector saw its revenues increase by 26%, while the industrial sector’s revenues increased by 11%. Five-year selection criteria Relevant to the investors’ point of view, the top 10 rankings of the companies since the beginning of 2009 were calculated by ALSHALL based on seven financial ratios in line with their respective weighted average criteria. The weights used were 20% each for Price Growth, Dividend Yield and Liquidity, while Net Profit Growth, Revenue Growth, Return on Equity and Return on Asset were weighted 10% each, Raphael says. It is important to note that the rankings were applied only to 39 companies out of the 42 listed on Qatar Exchange up to December 2013, because only companies listed on the bourse since the beginning of 2008 and having five years of public disclosure on record were selected for this exercise. For this year, Ezdan Real Estate Company, Gulf International Services, and Islamic Holding Group have been included for the first time in the computations as they reached the five-year criteria for selection, he says. Average price growth Historical data of year-end share closing prices and share dividend distributions for

TOP 1 0 C OM PA N I ES IN TER M S O F N ET P RO FI T G RO W TH

MEDICARE GROUP

1014.3%

AL KHALIJ COMMERCIAL BANK QATAR GEN. INSURANCE &

245%

222.1% 178.8%

REINSURANCE CO. EZDAN REAL ESTATE CO. QATAR OMAN INVESTMENT CO. UNITED DEVELOPMENT CO. QATAR GAS TRANSPORT CO. LIMITED (NAKILAT) GULF WAREHOUSING CO. QATARI INVESTORS GROUP BARWA REAL ESTATE CO.

91.1% 90.7% 76.3% 62.2% 37.8% 34.6% SOURCE: AUDITED FINANCIAL STATEMENTS FOR THE PAST FIVE YEARS (2009-2013), QATAR EXCHANGE AND ALSHALL CALCULATIONS

A REMA RKAB LE YE AR FOR QATAR EXCHANGE, 2013 HAS BEEN REMARKABLE AS ALL INDICATORS TURNED GREEN, WITH THE MAIN INDEX BREAKING THE 10,000 BARRIER (CLOSING AT 10,379.59) AND UP 24.17% OVER THE YEAR, VOLUMES INCREASED ALMOST 6% (FOR A TOTAL CONSIDERATION NEARING QR75 BILLION), WHILE THE MARKET CAPITALISATION GREW MORE THAN 20% TO QR555 BILLION.

ll the hard work undertaken by the Qatar Exchange and listed companies with the support of concerned authorities to modernise the market structure and boost its efficiency eventually paid off and was logically crowned with the upgrade of the Qatari market from frontier to emerging market at major index providers MSCI and S&P Dow Jones. In parallel, a number of market development initiatives came to successful fruition in 2013: the launch of the QSE Al-Rayyan Islamic Index in January and that of a government bond market in June, regulatory approval of the work frame for securities lending, sponsored access (also known as DMA) and liquidity provision schemes. Another positive element is that the trend set in 2013 has been confirmed so far in 2014. The combination of robust financial results posted by the listed companies along with healthy dividends distributed and the effectiveness of the emerging

market upgrade (which took place on May 29, 2014) have had a very positive impact on both the share prices (and consequently on the QSE20 main index) and trading volumes. Beyond the strong fundamentals of the Qatari economy, other causes exist to explain this positive trend, ranging from the first IPO in four years (Mesaieed Petrochemical Holding Company on February 26) to the Emiri Decree allowing listed companies to raise their foreign ownership limits to 49% of the total capital and GCC nationals to be treated the same as Qatari nationals with respect to the ownership of shares listed on the QSE. As a result, there could be a tendency to rest on our laurels. This is clearly not the case as a number of market and business development initiatives are ongoing and close to completion. Subject to regulatory approval, the first Exchange Traded Fund (ETF) should be listed, while margin trading, is expected to go live as well.

“The combination of robust financial results posted by the listed companies along with healthy dividends distributed and the effectiveness of the emerging market upgrade (which took place on May 29, 2014) have had a very positive impact on both the share prices (and consequently on the QSE20 main index) and trading volumes.” OLIVIER GUERIS COO, Qatar Exchange

QATAR TODAY > SEPTEMBER 2014 > 45

QATAR

TODAY

2013

GOING P U B LIC AN INITIAL PUBLIC OFFERING (IPO) AND LISTING ON QATAR EXCHANGE’S (QE) MAIN MARKET OR VENTURES MARKET (EXCHANGE FOR SMES) IS A CHALLENGING AND REGIMENTED PROCESS WHICH INVOLVES TAKING ACTIVE STEPS TO ENSURE THAT PRESCRIBED LISTING REQUIREMENTS AND EXPECTED ‘CORPORATE BEHAVIOURS’ ARE MET.

Note: The opinions expressed here are the views of the authors and do not necessarily reflect the views and opinions of Deloitte & Touche (Middle East).

n IPO is the sale of a portion of a company’s shareholding to the general public for the first time to raise cash. After that, the company lists its shares on a stock exchange and becomes a publicly-traded company. Some companies may choose not to go through an IPO and may opt for a direct listing process. However, before embarking on either a listing or listing and IPO, it is important that companies and shareholders fully commit themselves to the future plans of the company, its new structure and its ability to comply with ongoing listing rules and regulations. Pros and cons The reasons for going public vary for each company and are largely driven by its shareholders’ circumstances and commercial motives. There are various pros and cons to being a public company. Some of the key advantages are as follows: Access to funds: Raising cash through public shares can be a relatively cheaper way to access more liquid capital. PostIPO and listing, a public company can issue more shares (e.g. rights issues) which may help facilitate project funding or mergers and acquisitions in the future. Improved management and performance: Separation of ownership and management through good corporate governance is healthy and enhanced reporting requirements encourage management to improve their existing controls and information systems, which improves overall business efficiency. Prestige and profile: Listed companies carry an enhanced image and status. This helps in attracting qualified and experienced employees, better quality trading partners, suppliers and business opportunities.

46 > QATAR TODAY > SEPTEMBER 2014

MILHAN BAIG (left) is Director and ROBIN BUTTERISS is Head of Financial Advisory Services at Deloitte, Qatar

Succession planning: Conversion from a family-owned business to a listed company provides greater stability and easier succession planning or transfer negotiations. Value enhancement: Public companies shares may carry a higher valuation in comparison to privately held comparable companies due to liquidity and listed status. However, being listed also has its challenges as companies are required to comply with strict ongoing regulations. Some of the key challenges may include the following: Dilution of shareholding and management control: an IPO implies that the existing shareholders give up a percentage of their shareholding to the public and the board will need to include external independent board members. Management time and resources: Additional time and input will be required from management and the board to comply with regulatory requirements and communicate with investors to manage their needs and expectations. Additional reporting, disclosure and compliance in relation to legal, accounting and regulatory requirements may also lead to increased costs and resource commitments. Lesser privacy: The need for greater dis-

closure requirements imply that competitors, customers and suppliers will have access to the company’s information and family businesses may no longer feel as private as they used to be. Listing Companies can either list on QE’s Main Market or Ventures Market and in order to get listed on either of the two exchanges, companies are required to meet minimum listing criteria prescribed by the QE and Qatar Financial Markets Authority (“QFMA”) (see chart). Readiness A ‘readiness assessment’ is typically undertaken as a first step before considering an IPO/listing. Readiness includes performing a gap analysis between the current state of the company and what is required by the QE and QFMA to satisfy listing requirements (stated previously). In order to complete a successful IPO/listing, some of the key aspects of a company which should be particularly assessed include ownership structure, legal review, financial history and reporting environment, corporate governance, business plans, remuneration and

L I ST I N G R EQU I R EM EN TS Companies can either list on QE’s Main Market or Ventures Market and in order to get listed on either of the two exchanges, companies are required to meet minimum listing criteria prescribed by the QE and Qatar Financial Markets Authority (“QFMA”) which includes the following:

CRITERIA Subscribed share capital

MAIN MARKET

VENTURES MARKET

Minimum 40 million Qatari Riyals (50% paid up)

Minimum 5 million Qatari Riyals (50% paid up)

Minimum 100 shareholders1

Minimum 20 shareholders

No. of Shareholders

3 years2

1 year

Track record

Minimum 20%

Minimum 10%

Free float

Prospectus

Information Memorandum

Disclosure document

Required at submission only

Required at all times

Listing advisor

Not required

Proposed

Liquidity provider

Secondary only

Allowed

Foreign issuers

Decided by QFMA on a case by case basis

50% of owner’s shares are locked for 1 year

Lock requirements NOTES:

Minimum 100 shareholders of whom a maximum of 25% may be non-Qatari (subject to certain constitutional regulations). It may also be noted that QFMA offering/listing rules require only a minimum of 30 shareholders for "transformed" companies. Can be waived in case of Government companies QFMA Offering/Listing Rules do not currently require a minimum free float for “transformed” companies. Information memorandum has reduced disclosure requirements 50% of the owner’s shares are locked for one year. The lock-up starts from the beginning of trading of the company’s shares on QE. All Board members are required to retain a minimum number of shares for the duration of their membership in the board.

Whether choosing to list a company on QE’s Main Market or the Ventures Market also has further considerations. Some of these may include the following: MAIN MARKET Pros: Larger exchange attracts a bigger pool of investors, the Main Market has a longer history and track record, alignment to a listed sector on the Main Market provides better relativity for share trade, and higher share trade volumes provide a better reflection of market value. Cons: Carries a relative disadvantage for smaller companies as the exchange sentiments tend to be mainly led by bigger market players, stricter listing requirement than the QE Ventures Market, and takes more time to list in comparison to QE Ventures Market. VENTURES MARKET Pros: Government (Enterprise Qatar) support exchange which provides more confidence to investors, QE Ventures Market is targeted at growth businesses (SMEs) which indicates positive growth expectations, easier transition to the Main Market, Government and advisor assistance made available pre and post listing, easier to list, and quicker lead time to trading of shares. Cons: New market with no track record, will require a critical mass of listed companies on the exchange to trade meaningfully, will depend on government support in the short-term and volumes of trade may be relatively lower so prices may appear stale at times.

its valuation. Companies generally seek the help of professional listing advisers including investment banks, legal advisors and reporting accountants to assist with the listing/IPO process as it involves a series of compliance, documentation, filing, underwriting, review, valuation and advisory work. Conclusion There is no doubt that listing on an exchange is one of the most important steps for a business in transitioning to become

a word-class enterprise. However, listings require clearly defined motives and unreserved commitment from the business’s owners and senior management alike. Deloitte have been involved in the IPOs and listing of 14 of the 17 companies listed on the Qatar Exchange since 2003 and in our experience, effective planning, diligent implementation and robust valuations are key ingredients for a successful IPO and listing. B Y RO B IN B U TTER IS S A N D M I LH A N B A IG

the past five years were used to assess each company’s ranking in terms of price growth (or average yearly portfolio value increase based on one share purchased in each company at the beginning of 2009). While Widam Food Company maintained its number one spot as in last year’s ranking in terms of average price growth, it was followed by Medicare Group and Woqod which ranked second and third respectively. Dividend yield One of the major criteria in the methodology in determining a company’s overall ranking was the calculation of its dividend yield, which demonstrated how much a company pays out dividends each year in relation to its average market capitalisation. Masraf Al Rayan still achieved the highest rank in terms of dividend yield. It is also evident that 7 of the top 10 companies in terms of dividend yield came from the financial sector and the rest came from the consumer services sector. While Doha Bank retained second place, Salam International Investment Limited, which was ranked sixth in 2012, climbed three places to occupy third position in 2013. Net profit growth Net profit growth has been calculated on a cumulative shares held basis, to reflect whether the shareholder’s original claim over each company’s net profit has increased or decreased over the five-year period, and by how much on average. This has been done to offset any possible dilution resulting from corporate action. Medicare Group still ranks the highest, achieving a remarkable 1,014% average increase in net profit per share held. Net revenue growth Revenue growth was one of the basic criteria in assessing a company’s attractiveness, with the assumption that the higher the revenue growth, the more the potential for future profits. Qatar Gas Transport Co. Limited (Nakilat) significantly led the rankings, with cumulative shares held multiplied by revenues per share growing at an average of 344%, followed by Ezdan Real Estate Co at 133% average RPS growth. Liquidity The measure of liquidity should indicate how easily shares can be purchased or sold on the QE based on average trading volume per year and number of trades per day from QATAR TODAY > SEPTEMBER 2014 > 47

QATAR

TODAY W E I GH T E D AV ER AG E CR ITERIA TOP 1 0 C OM PA N I ES I N T E R MS OF LIQ U I D I TY 2013

SOURCE: AUDITED FINANCIAL STATEMENTS FOR THE PAST FIVE YEARS (2009-2013), QATAR EXCHANGE AND ALSHALL CALCULATIONS

MASRAF AL RAYAN

BARWA REAL ESTATE CO.

QATAR GAS TRANSPORT CO. LIMITED (NAKILAT)

INDUSTRIES QATAR

QATARI GERMAN CO. FOR MEDICAL DEVICES

QATAR OMAN INVESTMENT CO.

GULF INTERNATIONAL SERVICES

NATIONAL LEASING HOLDING CO.

ISLAMIC HOLDING GROUP

SOURCE: AUDITED FINANCIAL STATEMENTS FOR THE PAST FIVE YEARS (2009-2013), QATAR EXCHANGE AND ALSHALL CALCULATIONS

DIVIDEND YIELD

20%

LIQUIDITY

20%

NET PROFIT GROWTH

10%

REVENUE GROWTH

10%

RETURN ON EQUITY

10%

RETURN ON ASS ETS

10%

(AL SHALL FORMULA FOR QATAR TODAY TOP TEN CALCULATIONS)

2009 to 2013. Generally speaking, companies with both high daily volumes of traded shares and high number of trades have a better liquidity as compared with thin trading volumes and number of trades. Widam Food Company remained on top in this criterion, followed by Masraf Al Rayan which also retained its second position as last year.

TO P 10 COMPANI ES I N T E R MS O F AV E R AG E R E TU R N O N EQ U I TY ( RO E)

49.2%

33.8%

QATAR FUEL (WOQOD)

QATAR ELECTRICITY & WATER CO.

22.8%

21.9%

48 > QATAR TODAY > SEPTEMBER 2014

20%

WIDAM FOOD COMPANY

UNITED DEVELOPMENT CO.

PRICE GROWTH

QATAR NATIONAL BANK

28.3%

INDUSTRIES QATAR

21.3%

GULF INTERNATIONAL SERVICES

20.4%

19.6%

QATAR NATIONAL CEMENT CO.

WIDAM FOOD COMPANY

24.7%

MANNAI CORPORATION

20.8%

NATIONAL LEASING HOLDING CO.

Return on Equity Return on Equity (RoE) measures the ability of the company to generate sufficient returns for the capital invested by its shareholders. Qatar Fuel (Woqod) maintained its top position as in last year’s ranking in this category, followed by Qatar Electricity & Water Co. Average Return on Asset Return on Asset (RoA) determines the company’s ability to utilise its assets effectively and efficiently, thus earning a good return on it. In this criterion – crucial to asset-intensive companies – Industries Qatar ranked first, followed by Qatar Fuel (Woqod), similar to last year’s rankings, showing close results. Qatar Islamic Insurance Company was ranked third in the list. Comparative performance of world markets The year 2013 ended well in terms of capital markets, performance, with some of them achieving growth in their prices that is difficult to replicate again. The year closed with 13 of the 14 key markets making gains, including 11 making gains of two digits, i.e. 10% and more. Only the Chinese market made losses, which is believed to be

TOP 1 0 C O M PA N I E S IN TER M S O F AV ER AG E R ETU R N O N A S S ET ( ROA)

21.4%

INDUSTRIES QATAR

13.9%

QATAR INDUSTRIAL MANUFACTURING CO.

17.1%

QATAR FUEL (WOQOD)

11.5%

MANNAI CORPORATION

16.7%

16.6%

QATAR ISLAMIC INSURANCE CO.

QATAR NATIONAL CEMENT CO.

11.4%

11.3%

WIDAM FOOD COMPANY

10.4%

QATAR GEN. INSURANCE & REINSURANCE CO.

EZDAN REAL ESTATE CO.

GULF INTERNATIONAL SERVICES

ALSHALL ECONOMIC SERVICES: ALSHALL Economic Services QSC is a private Qatari shareholding company providing different economic, business and corporate finance advisory services to local and regional institutions. It was established in 2002 by ALSHALL Consulting Company KSCC, a Kuwait-based private consulting company, along with other partners, as a strategic arm in Qatar in order to provide the same range of established services in Kuwait. ALSHALL’s services are complemented by outsourcing and alliances with other specialized entities that assist ALSHALL in providing comprehensive services to its clients. Its approach is to assist its clients by assessing their operations and providing valuable advisory services for future success. DISCLAIMER: In preparing this article, ALSHALL may not have considered issues relevant to any particular reader. Any use that readers may choose to make of this article is entirely at their own risk and ALSHALL and Qatar Today shall have no responsibility whatsoever in relation to any such use. Accordingly, ALSHALL does not owe a duty of care to the readers of this article. Neither ALSHALL, nor affiliated partnerships or bodies corporate, nor the directors, shareholders, managers, partners, employees or agents of any of them, make any representation or provide any warranty, expressed or implied, as to the accuracy, reasonableness or completeness of the information contained in this article or of any other information relating to this article whether written, oral or in a visual or electronic form (including, without limitation, in a magnetic or digital form) transmitted or made available to the readers. All analyses appearing in this article do not in any way constitute an offer or recommendation to invest in any of the listed securities. ALSHALL hereby disclaims any responsibility of any direct or indirect claim resulting from using this article.

DELOITTE The numerical accuracy of the calculations have been verified by Deloitte.

QATAR TODAY > SEPTEMBER 2014 > 49

SOURCE: AUDITED FINANCIAL STATEMENTS FOR THE PAST FIVE YEARS (2009-2013), QATAR EXCHANGE AND ALSHALL CALCULATIONS

deliberate to avoid an asset bubble. Most of the support to these markets came from the prevailing belief that the world economy overcame its financial crisis, and from learning from some wrong practices, such as US politicians recently avoiding the fiscal-cliff policy in the treatment of the sovereign debt ceiling, the fading of European differences on the tough German approach, and the recovery of some small economies such as Dubai and Abu Dhabi. The Dubai market performance was the highest among all measured markets. Its 2013 gains exceeded the 100% barrier, or added 107.7%, followed by Abu Dhabi (both markets are about to merge), and added gains by 63.1%. Abu Dhabi market’s performance would be even better than Dubai’s if one looked at how it made up for its losses before the crisis at the end of 2007. The new Japanese prime minister has achieved what may be described as moving Japan from recession and negative inflation to a growing economy. Inflation rates were positive in 2014, supported by a lower-priced Japanese Yen which provided a boost to the economy’s competitiveness. The Japanese financial market, which is described as a mature market, responded to those indicators. Its index increased in 2013 by about 56.7% and achieved the third position in gains with more than double the US Dow Jones index, which occupies the fourth position. “Excluding the gains of the Kuwait price index of 27.2% placing it in the 4th rank, there are 8 other markets in the middle of the list which achieved two-digit gains, the highest being the Dow Jones by about 26.5% and the lowest being the British market at 14.4%. All the six regional markets made two-digit gains and more, two of which were quite ahead of the rest, four in the middle, and the lowest in performance was the Bahraini market which earned 17.2%. The Indian market came 12th with about 9% gains,” Camille says. It is not expected for the markets to achieve similar gains in 2014 or even come close to their 2013 performance, and if they did, they would be vulnerable to a new bubble. The performance order of these markets will change, though it is likely to be positive in general. Poorly performing markets, such as the Chinese market, might lead the performance next year, while the medium performers will maintain performance close to that of 2013, and the high-performing markets might drop down to the middle or weak pack, Camille adds.

QATAR

TODAY 2012 | 2013 2013

WIDAM FOOD COMPANY (QATAR CO. FOR MEAT AND LIVESTOCK TRADING)

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NO LOOKING BACK THE TIDE HAS TURNED FOR WIDAM FOOD COMPANY (FORMERLY MAWASHI) FROM WHEN IT WAS DISMISSED AS ANOTHER FAILED COMPANY AND THE GOVERNMENT MULLED OVER ACQUIRING IT TO PROTECT THE INTERESTS OF INVESTORS.

owever, a last chance under a new management in 2010 lifted its fortunes and today Widam Food is not only one of the biggest companies in the GCC but has also earned global repute for its operations. Widam, which was ranked fourth among the top 10 companies of Qatar in 2010, ascended to the third position in 2011 and occupied first place in 2012, a position which it retained in 2013. Widam Food’s managing director Abdulrahman Hamad Sraiya Al Kaabi shares the secret behind his company’s success over the last four years. Tell us how your decisions have resulted in successes for the company in 2013? This is due to our commitment towards its vision and strategy to expand the scope of its work at the local and regional level, in addition to our commitment to ensure its future as the largest food supplier and not to be confined to the red meat trade, in line with our plans to supply the local market with its requirements for poultry and fish. What challenges did Widam face and how did you manage them? International markets usually suffer from varied and recurrent upheavals, especially in the food sector. Widam Food had a clear-cut approach to ensure the availability of cattle and meat in local markets through diversifying supply sources. Due to its long-standing and good trade relations with Australian companies, Widam imports large quantities of Australian sheep, cattle and fodder to meet the needs of the local market. The company imports large quantities of Arab cattle from Syria and Jordan; African cattle from the

50 > QATAR TODAY > SEPTEMBER 2014

ABDULRAHMAN HAMAD SRAIYA AL KAABI Managing Director, Widam

Sudan, Somalia, Ethiopia and Kenya; and Asian lamb meat from India and Pakistan. How did you inspire your workforce as a team leader during the crisis? Widam continues from the outset to provide a healthy and stable work environment and ensure a good future and satisfactory professional life for its workforce; and at times of crises it chooses suitable cadres to deal with them. What Widam Food is working to achieve through its internal policies is to enhance supervision and accountability practices in the company in order to create a sense of responsibility and commitment among the employees towards the company. The company has a number of long-serving staff who prefer to work for the company despite the availability of other opportunities in the country. I am satisfied with the performance of the successive managements that preceded my team at the helm of the company.

Which segment contributed mostly to the company’s revenues last year? Last year, the returns had increased as a result of a 25% increase in sales during the period and in the first half of 2014. The sales of non-Australian meat, namely Arab, witnessed a 40% increase from the same period in 2013, leading to a total growth of 28% in sales revenue. In spite of decreased purchase prices of subsidised Australian lamb meat, sales and other revenues increased to reach QR2.8 million in Q1 of 2014 compared with QR451,000 realised for the same period in 2013. What are your plans for Widam for the next five years? We have several plans including setting up a Widam meat plant which has reached the final stages of engineering structure. The plant will fulfill the increasing demand for meat products in the market, especially with the use of modern techniques and systems for health protection. Development and innovation plans also cover the existing slaughter houses as part of the master plan that we have implemented in the automated Al Khor and Al Shamal slaughter houses, where the most up-to-date techniques and systems were introduced in areas like operation, sterilisation, quality, and development of output capacity. We also aim at meeting the growing demand of customers who visit the slaughter houses on a daily basis. The Doha Project for Agricultural and Livestock Production that Widam is implementing in the Sudan has witnessed a phenomenal transformation in demand for the company’s production of Sudanese meat and fodder.

2012 | 2013

MASRAF AL RAYAN

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DEFINING ISLAMIC BANKING WITH BETTER DIVIDEND YIELD AND IMPROVED LIQUIDITY, MASRAF AL RAYAN BANK HAS RETAINED SECOND PLACE AMONG THE TOP 10 COMPANIES OF QATAR IN 2013.

ccording to Group CEO of Masraf Al Rayan (MAR), Adel Mustafawi, since its establishment the bank has maintained its focus on growing its core banking business and building its business infrastructure to meets its long-term strategic vision. PERFORMANCE The bank registered a growth of 13.2% in net profit and posted QR1.7 billion. The total assets reached QR66.54 billion compared with QR61.62 billion as of December 31, 2012, a growth rate of 7.98%. Return on Assets reached 2.56%. Financing activities registered a total of QR41.44 billion compared to QR41.71 billion as of December 31, 2012, a decrease of 0.67%. Investments increased to QR16.56 billion from QR14.55 billion as of December 31, 2012, an increase of 13.8%. PLANS 2013 was not different from previous years as we continued on planting the seeds for solid and a sustainable business development across all aspects of our business, risk management and operational activities supported by a dynamic business model. MAR’s sustainable strategies and policies ensure that we always maintain a calculated balance between business development

and risk management. This balance is considered to be fundamental to selecting and booking new business, he says. “We continued to focus on expanding its retail franchise while strengthening our position in the corporate and SME sectors. MAR has established itself as a prominent financial institution the region commanding a reasonable market share in both assets and liabilities while maintaining excellent asset quality metrics (with NPLs at 0.10%), return on assets and return on equity compared to its peers,” Mustafawi says. MAR has been carefully seeking the right opportunities to increase its footprint across MENA, Europe and beyond. CUSTOMER SERVICE It has been our solid intent and strategy from day one to entwine growth in business with excellent quality customer service. In addition, MAR philosophy of tailoring its products and services to match client needs and requirements have won us an excellent reputation with our customers. We always put the needs and interests of customers first. We not only provide banking and financing services but we offer them a full suite of solutions - end to end. QATARI BANKS ARE STRONG Qatari banks are well positioned to ride

any potential global recession as has been done in the past. In general Qatari banks are well regulated under the guidance of the QCB. The strong and developed regulatory environment forms the cornerstone of the strength the Qatari banks have been built over the years. The banking sector in general is well capitalised and continues to maintain high quality assets while generating excellent returns on assets and equity compared with many banks outside Qatar. BEST AND TURBULENT PHASES The strength of the Qatar’s economy and sound fiscal and monetary policies set by the government combined with MAR’s prudent risk management and conservative business model has shielded the bank from volatility while ensuring its performance is sustainable and consistent year after year. SOURCE OF INSPIRATION Equal treatment and inclusion of all employees regardless of their role through the decision making process makes every member of MAR important and valued. This culture coupled with teamwork, effective leadership and aggressive learning and development programs at par with international standards enable us to get maximum productivity and loyalty from our colleagues.

“We have adopted a set of business philosophies and practices based on fundamental moral grounds, and thus all plans are derived along those lines, in addition to building of strong human capital teams, remaining focused on key strategic drives, initiatives and maintaining sustainable high quality assets and earnings.“ ADEL MUSTAFAWI, GROUP CEO, MASRAF AL RAYAN QATAR TODAY > SEPTEMBER 2014 > 51

QATAR

TODAY 2012 - 6TH | 2013 2013

MEDICARE GROUP

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A PIONEER IN HEALTHCARE MEDICARE GROUP (FORMERLY SPECIALISED AL AHLI HOSPITAL CO.) IS ONE OF THE LEADING HEALTHCARE PROVIDERS IN QATAR. IT WAS ESTABLISHED IN 1997 WITH A PAID-UP CAPITAL OF QR280 MILLION AND WAS LISTED ON QATAR EXCHANGE THE SAME YEAR.

he company, which climbed three spots among the top ten listed companies in 2013 compared with the previous year, operates a specialised hospital and outpatient clinic; provides health and treatment services; and engages projects and companies that are generally associated with medical services. Conceptualised by ten Qatari businessmen in 1989, Al Ahli Hospital was to be a 100-bed profit-based hospital specialising in Pediatrics, Obstetrics and Gynecology. A year after envisaging the project, this motivated private group of shareholders approached the government seeking support and were allocated land in Ahmed Bin Ali street conditional to building a new healthcare facility. Strengthened by the government support, the project attracted other private individuals to participate as shareholders. The original ten initiators grew to about 100 founding members, and a founding committee was elected in 1996. The committee revisited the project plan and decided to establish a 250-bed private general hospital that would provide

five-star healthcare services. With the election of the new board of directors in 2001, the syndicated loan which the board obtained from the banks to build Al Ahli Hospital was converted to an Islamic financing facility in order to make it Shariah compliant and be in accordance with the Article of Association of the company. The company then repaid the total amount of the loan from a new rights issue and Al Ahli became debt-free for the first time and fully owned by its investors in 2006. The hospital opened its services to the public in November 2004. The current managing director and Chief Executive Officer of Medicare Group and Al Ahli Hospital, Abdulwahed Al Mawlawi, was elected in April 2006. With his vast experience in senior management and healthcare, Al Mawlawi introduced the concept of Love as the ultimate value of Al Ahli Hospital. The various clinical departments of Al Ahli Hospital include anesthesiology, chiropractics, dentistry, dermatology, emergency, gastroenterology, general surgery, heart care, internal medicine, obstetrics and gynecology, ophthalmology, orthopedics and traumatology, pediatrics,

Strengthened by the government support, the Al Ahli Hospital project attracted other private individuals to participate as shareholders. The original ten initiators grew to about 100 founding members, and a founding committee was elected in 1996.

52 > QATAR TODAY > SEPTEMBER 2014

psychiatry, pulmonary and chest, and urology. The hospital’s ancillary services and units include dietary, pathology and laboratory medicine, pharmacy, physical and rehabilitative medicine, radiology, speech and language therapy, neonatal intensive care and coronary care. PERFORMANCE The company’s net profit during 2013 was QR89.4 million, compared with QR44.8 million in 2012, and the average earnings per share growth was a staggering 1014.3% – QR3.18 in 2013 against QR1.59 in 2012. Medicare Group has announced that Al Ahli Hospital has signed the agreement for the second phase of healthcare providers with National Health Insurance Company (Seha) of the Supreme Council of Health. ACHIEVEMENTS Medicare Group has said that Al Ahli Hospital secured the grant of a four-year accreditation based on the recommendation of the Australian Council on Healthcare Standards delegation a few months ago.

2013 PROFIT

QR89.4 MILLION

2012 PROFIT

QR44.8 MILLION

2012 - 3RD | 2013

QATAR FUEL (WOQOD)

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DRIVING AHEAD ESTABLISHED IN 2003, WOQOD (QATAR FUEL), A DOWNSTREAM OIL STORAGE DISTRIBUTION AND MARKETING COMPANY, HAS DIVERSIFIED INTO VARIOUS BUSINESSES AND HAS PERFORMED REMARKABLY WELL OVER THE YEARS.

he company’s success can be gauged by the fact that its profit, which stood at QR40 million in the first year of its inception, exceeded QR1.2 billion in 2013. The company is now looking ahead to increase its activities by investing over QR1 billion in the coming years. “Woqod’s strong financial performance augurs well for our shareholders and I attribute the success to the management’s vision in shaping the company and to the contribution from the workforce and also the wide customer base,” Ibrahim Al Kuwari, CEO of Woqod, explains. While aviation fuel is supplied to NHIA and Qatar Airways, retail sales include the supply of diesel and petrol through its service stations, cooking gas to domestic and commercial customers, and bitumen products to the local contractors. Woqod also supplies bunker fuel to ships and owns Fahes, a Qatari company which manages technical inspection centres for all the road vehicles in Qatar. “With the population growing in Qatar the number of vehicles on the roads has increased, the business of these technical centres is growing rapidly,” Al Kuwari says. PERFORMANCE The net profit (after excluding minority interest) exceeded QR1.216 million in 2013, an increase of 5.75% compared with previous year. Following an increase in the capital base through issuing 25% bonus shares in 2012, Earnings Per Share increased to QR18.72 compared with QR 17.70 for the same period in 2012. While total assets reached QR9.7 billion, up by 20.45 % from 2012 figures, total equity recorded a growth rate of 15.47% to reach QR6.3 billion for the same period.

IBRAHIM AL KUWARI CEO, Woqod

Total sales of retail services recorded a growth of 30% during the 2013 year compared with the previous year. LPG sales also grew by 15% during the period. Total sales of petroleum products (gasoline, diesel and jet A-1) increased by 12.3% to reach about 6.45 billion liters in 2013. The sales of bitumen also increased by 52% and are expected to record a high growth rate in coming months due to the new commitment of Ashghal and the new technical cooperation which is currently underway between Woqod and Texas A&M University in the field of modified bitumen research. According to the findings of Texas research, Woqod’s bitumen is fully compliant with international standards and specifications. PLANS One of the challenges the company is facing is availability of land as some service stations in the centre of Doha, which were

on private lands, have closed in view of the spurt in real estate business in the country. Woqod currently operates 23 service stations and an equal number of retail outlets are under various stages of progress and expected to be opened by 2015. “We will invest around QR1.2 billion and plan to have 100 service stations by 2018,” Al Kuwari says. The management is working very closely with the government to ensure adequate land for them. One of the challenges which has made the problem more complex is number of closures of service stations. This is usual in fast growing cities as real estate value is high and land owners receive higher income from developing their lands. NEW PROJECTS During 2013, five petrol stations were commissioned. Four more are either under construction or in tendering stages and are expected to be opened later in 2014. Another five projects are currently in design. These projects are expected to be completed by the end of 2015. As far as expansion of existing petrol stations is concerned, one project has been completed. Another four are expected to be completed by December 2014. ENVIRONMENT Al Kuwari says the company has been working with Qatar Petroleum to introduce compressed natural gas (CNG) for road vehicles. “CNG has been proven, as a low pollutant, a safe and reliable fuel and we plan to have 15% of Qatar’s road transportation running on gas in the next five years,” Al Kuwari explained. The company also plans to introduce LNG as bunker fuel for ships and some of its affiliates are already building tugs and service vessels that can run on LNG as opposed to diesel. QATAR TODAY > SEPTEMBER 2014 > 53

QATAR

TODAY 2013 2013

INDUSTRIES QATAR

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ON THE FAST TRACK INDUSTRIES QATAR, ONE OF THE REGION’S BLUE CHIP INDUSTRIAL GROUPS AND MOST SUCCESSFULLY-LISTED COMPANIES IN THE COUNTRY, ENTERED ITS SECOND DECADE OF OPERATIONS IN 2013, WITH THE FIRST HALF MARKED BY MANY ACHIEVEMENTS.

hile the net profits grew by an annual average of 16%, the net assets increased more than three-fold and the number of companies in the group grew to 18. By investing over QR20 billion since its incorporation in building and improving facilities, the group has laid the foundation for the continuation of its impressive growth story in 2013. PERFORMANCE Despite a drop in fertiliser prices due to a global turndown that has seen the group’s quarterly weighted average urea price drop by almost 40% since the current commodity cycle high in the third quarter of 2011, and by almost 20% versus 2012, Industries Qatar closed 2013 with full year earnings of QR8 billion and total cash and short-term deposits across all of the group’s companies grew by QR1.6 billion to reach QR10.7 billion. IQ chief coordinator Abdulrahman Ahmad Al Shaibi says: The results were adversely affected by continued and significant fertiliser price deflation, in line with international trends, and heightened fer-

ABDULRAHMAN AHMAD AL SHAIBI Chief Coordinator, Industries Qatar

tiliser operating costs following increase in natural gas rates under the supply and purchase agreement with Qatar Petroleum. PLANS Industries Qatar intends to build on the foundations of the previous decade and the Al Sejeel Petrochemical Complex, a joint venture between Qatar Petroleum and

"The results were affected by continued and significant fertiliser price deflation, in line with international trends, and heightened fertiliser operating costs following increase in natural gas rates under the supply and purchase agreement with Qatar Petroleum." ABDULRAHMAN AHMAD AL SHAIBI CHIEF COORDINATOR, INDUSTRIES QATAR 54 > QATAR TODAY > SEPTEMBER 2014

Qapco, with an estimated cost of about QR4 billion. Upon its completion towards the end of 2018, the project is also expected to reinforce the State of Qatar’s position as a major regional petrochemical producer. Following the incorporation of the QR7.6 billion Algerian Qatari Steel Company in January 2014, in which IQ has an equity investment of QR 0.6 billion, construction of the 2 million metric tonnes per annum (MTPA) integrated steel mill in Algeria is expected to be completed in the first quarter of 2018. This joint venture with the Algerian government is one of IQ’s largest overseas investments to date, and marks an important and highly positive development in the strong relations between the two countries. The Group recently announced the commencement of commercial operations of a new QR 1.2 billion steel melt shop in Mesaieed Industrial City. The EF5 project will boost the Group’s billets capacity by an additional 1.1 million MTPA, ensuring that as Qatar continues its ambitious construction programme in the run-up to the World Cup 2022, Qatar Steel will maintain its position as the country’s predominant steel supplier.

2013 EARNING

QR8 BILLION

AS QATAR CONTINUES ITS AMBITIOUS CONSTRUCTION PROGRAMME IN THE RUN-UP TO THE WORLD CUP 2022, QATAR STEEL WILL MAINTAIN ITS POSITION AS THE COUNTRY’S PREDOMINANT STEEL SUPPLIER.

2013

GULF INTERNATIONAL SERVICES

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A MAIDEN ENTRY GULF INTERNATIONAL SERVICES, WHOSE INTERESTS ARE IN VARIOUS CROSS SECTIONS OF INDUSTRIES SUCH AS INSURANCE, RE-INSURANCE, FUND MANAGEMENT, ONSHORE AND OFFSHORE DRILLING, ACCOMMODATION BARGE, HELICOPTER TRANSPORTATION AND CATERING SERVICES, HAS MADE IT TO THE TOP 10 COMPANIES LISTED ON QATAR EXCHANGE FOR THE FIRST TIME.

he company was established by Qatar Petroleum (QP) and incorporated as a Qatari shareholding company in February 2008. The authorised capital of GIS is QR10 billion divided into 1 billion shares of QR10 each, and the issued capital is QR1.23 billion. In May 2008, the company had listed 70% of the issued capital in the Doha Securities Market (presently Qatar Exchange). GIS has significant investments in national and international oil and gas industry-related service companies, including well support, offshore and onshore drilling, helicopter maintenance and transportation, and insurance and reinsurance services. Currently, it owns and controls stakes in three companies – Al Koot Insurance and Re-insurance (100%), Gulf Drilling International (69.99%) and Gulf Helicopters (100%). GDI deployed two new high-specification, premium offshore rigs – Al-Jassra, which joined the fleet in May 2013, and Leshat, which started operations in December 2013. GDI signed a five-year contract with a major oil company operating in Qatar for the utilisation of this rig. GDI’s ninth offshore rig, Dukhan, is its third new, high-specification, premium rig ordered in

HE DR MOHAMED BIN SALEH AL SADA Minister for Energy and Industry

the last two years. It is expected to arrive in Qatar by end 2014. GIS Chief Coordinator Ibrahim Al Mannai says: “GDI expects to have a total of 21 assets under operation by mid-2016, up from nine at the beginning of 2012. At that point, GDI’s fleet is projected to be comprised of ten offshore rigs, eight onshore rigs, two lift-boats and one accommodation barge.”

PERFORMANCE Putting up its best financial records in 2013, GIS has earned a net profit of QR677 million during the year, registering an increase by 45.81% compared with QR464.3 million the previous year. Its Earnings per Share amounted to QR4.55 in 2013 compared with QR3.12 in 2012. HE Dr Mohamed bin Saleh Al Sada, Minister of Energy and Industry, who is also Chairman and Managing Director of Gulf International Services, says; “The GIS group exceeded expectations in 2013. These are the highest year-end results since inception and a remarkable achievement in the group’s short history.” “This growth reiterates our historical commitment to the goal of maximising shareholders’ wealth. These strong results were aided by the ambitious growth plans in all segments, and the acquisition last year of Amwaj Catering Services Limited,” he adds. On the insurance segment, Al Mannai says: “As part of the insurance segment’s growth plan, Al Koot explored new opportunities for its medical insurance line of business. To this end, the company successfully secured a number of major new clients, thereby increasing the number of medical policyholders by 15,000 to a total of over 115,000.”

PLANS Gulf Helicopters has placed orders for 15 AW-189 helicopters with AgustaWestland’s latest generation aircraft. Subject to prevailing market conditions, 11 aircraft are expected to be deployed in the next five years to bring the total count to 54, with the first two helicopters expected to be delivered in the third quarter of 2014.

AS OF DECEMBER 2013 REVENUES: QR2.3 BILLION

TOTAL ASSETS: QR5.36 BILLION

GROSS PROFIT: QR484.0 MILLION

CASH AND SHORT-TERM DEPOSITS: QR893.2 MILLION

NET PROFIT: QR677 MILLION

SHAREHOLDERS’ EQUITY: QR3.08 BILLION

EARNINGS PER SHARE: QR4.55

TOTAL DEBT: QR608.2 MILLION

QATAR TODAY > SEPTEMBER 2014 > 55

QATAR

TODAY 2012 - 4TH | 2013 2013

NATIONAL LEASING HOLDING COMPANY (ALIJARAH)

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PROVIDING A NEW LEASE NATIONAL LEASING HOLDING COMPANY (ALIJARAH ) WAS ESTABLISHED IN MARCH 2003 AS A QATARI SHAREHOLDING COMPANY WITH INTERESTS IN DIFFERENT BUSINESSES LIKE ALIJARAH LEASING AND ALIJARAH EQUIPMENT, AND IS ENGAGED IN PROVIDING PRODUCTS AND SERVICES RELATED TO RENTING AND LEASING TO INDIVIDUALS AND SMALL, MEDIUM AND LARGE BUSINESS FIRMS.

ith subsidiaries that are involved in property development, equipment and limousine services, the company, which prides itself on its commitment to the principles and provisions of Islamic Sharia law in all transactions, slid by three places to seventh rank in 2013, compared with the previous year. “Ours is the most admired company in the country and the most respected Islamic leasing services brand in the region. We will establish ourselves as leaders in the material transportation, property development and limousine services,” says its chairman and managing director Sheikh Falah bin Jassim bin Jabr Al Thani. PERFORMANCE In the previous years, property business formed a significant portion of the group’s revenue, but in 2013, Islamic leasing regained its first place and property revenue declined, impacted by the completion and hand over of the Lusail Infrastructure Project, he says. In 2012, Lusail Infrastructure Development was the major contributor

villa and two years have to lapse from construction completion to obtain legal title to the land. These are the terms of the plot sale,” Sheikh Falah says. According to him, the company is currently discussing with customers on the approach to fulfill their obligations on villa construction.

HE SHEIKH FALAH BIN JASSIM BIN JABR AL THANI Chairman and Managing Director, Alijarah

to the total revenue and profit. Since this project has reached hand over stage in 2013, there was a dip in the total revenue and profit recognised. However, Alijarah's revenue from investments and deposits increased to QR35 million in 2013 from QR20 million in 2012. Total equity stood at about QR1.2 billion and Earnings per Share reached QR1.76. “Lusail Plot customers have to build the

“Ours is the most admired company in the country and the most respected Islamic leasing services brand in the region. We will establish ourselves as leaders in the material transportation, property development and limousine services.” HE SHEIKH FALAH BIN JASSIM BIN JABR AL THANI CHAIRMAN AND MANAGING DIRECTOR, ALIJARAH 56 > QATAR TODAY > SEPTEMBER 2014

PLANS The company has already planned villa constructions as a continuation of the infrastructure project, for which the tendering process is in the final stages. "The company is exploring other infrastructure and real estate development opportunities to capitalise on the growth potential in Qatar. Plans are underway to construct a state-of-the-art driving-school facility to meet the growing demand for drivers in Qatar. The taxi and limousine segment is slated to grow further, with the planned injection of additional fleet in 2014, taking the total to 1,000 taxis. "We are negotiating additional contracts. Alijarah is also planning to infuse additional trailers to replace the old ones and also to cater to the additional requirements,” Sheikh Falah adds.

TOTAL EQUITY STOOD AT ABOUT

QR1.2 BILLION

AND EARNINGS PER SHARE (EPS) REACHED

QR1.76.

2013

QATAR GAS TRANSPORT COMPANY LTD (NAKILAT)

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ON THE GROWTH TRAJECTORY NAKILAT (QATAR GAS TRANSPORT COMPANY LIMITED) IS A QATARI-OWNED MARINE COMPANY WHICH WAS ESTABLISHED IN 2004 AS A JOINT-STOCK COMPANY – OWNED 50% BY ITS FOUNDING SHAREHOLDERS AND 50% BY THE PUBLIC.

t has the largest LNG shipping fleet in the world, consisting of 54 LNG vessels along with four Liquefied Petroleum Gas (LPG) Very Large Gas Carriers (VLGCs), which represents almost 15% of the world’s marine LNG-carrying capacity through which it continues to transport this energy to various destinations around the globe. For Nakilat, 2013 has been a year full of growth and positive developments due to its position at the helm of activities at Erhama Bin Jaber Al Jalahma Shipyard, for Qatar’s marine industry. The financing agreements achieved by Nakilat in 2013 are also testament to the company’s firm foundations. Nakilat successfully arranged QR3.34 billion ($917 million) in refinancing with Qatar National Bank for its wholly-owned subsidiary Nakilat Inc. while refinancing another QR4.84 million ($1.33 million) for the joint venture Maran Nakilat Co. Ltd., in which Nakilat simultaneously increased its ownership to 40% from 30% and added four vessels. PERFORMANCE As of December 31, 2013, total assets of Nakilat, including Nakilat’s share of its joint venture assets, was over QR44 billion,

dividend of QR1.10 per share, which is a 37.5% increase above the IPO estimate of QR0.80. On a cumulative basis, total dividends for 2009-2013 would be QR4.2, which is 2.2 times the IPO estimate of QR1.88.

ABDULLAH FADHALAH AL SULAITI Managing Director, Nakilat

compared with QR27.6 billion projected in its IPO prospectus. In addition, Nakilat also has an economic interest - full operational and management responsibilities in the QR10.6 billion Erhama Bin Jaber Al Jalahma Shipyard, with funding by Qatar Petroleum in the Port of Ras Laffan, giving its total assets a value of QR54.6 billion and net profit reaching QR730 million in 2013. After a strong financial performance in 2013, the company has announced a cash

"The company has plans to increase its fleet of LNG carriers and is holding talks with a number of European and Asian countries in the field. Nakilat also has plans to increase the company’s stake in Greece’s Maran Gas and expand its LNG delivery operations."

PLANS About future plans, Nakilat’s Managing Director Abdullah Fadhalah Al Sulaiti says the company has been keen to expand its investments, which currently have reached QR54.6 billion. “The company has plans to increase its fleet of LNG carriers and is holding talks with a number of European and Asian countries in the field. Nakilat also has plans to increase the company’s stake in Greece’s Maran Gas and expand its LNG delivery operations,” he says. The LNG global market is at a promising phase, something that encourages Nakilat to look for investment opportunities outside Qatar in order to achieve more value addition to the company and its shareholders. “The company welcomes any investment that achieves profit commensurate with its vision. However, the company’s focus at the moment is mainly on the activity of gas shipping, an area which we are seeking to expand,” he said.

NET PROFIT REACHING

QR730 MILLION

IN 2013 TOTAL ASSETS VALUE

QR54.6 BILLION

ABDULLAH FADHALAH AL SULAITI MANAGING DIRECTOR, NAKILAT QATAR TODAY > SEPTEMBER 2014 > 57

QATAR

TODAY 2012 - 10TH | 2013 2013

DOHA BANK

DIVIDEND YIELD:

RANK

SPREADING WINGS QATAR’S BANKING SECTOR HAS WITNESSED A ROBUST GROWTH FOR THE LAST FEW YEARS AND, LIKE OTHER BANKS, THERE IS NO TURNING BACK FOR DOHA BANK DURING 2013. THE BANK HAS NOT ONLY RETAINED ITS PLACE IN 2013 AS FAR AVERAGE DIVIDEND YIELD IS CONCERNED BUT ALSO CLIMBED ONE SPOT IN THE OVERALL RANKING – FROM 10TH POSITION IN 2012 TO 9TH IN 2013.

ounded in 1979, Doha Bank is the third largest bank in terms of commercial activities and has consistently registered strong growth in the last decade. It has also achieved one of the best returns on average equity and return on average assets among the banks in the Middle East over the last ten years. “The bank will continue to focus on Indian expansion as India has a huge bilateral trade and development not only with Qatar or GCC countries but also with most of the global locations where it is present,” say Doha Bank CEO Dr R Seetharaman. How have your new plans impacted the bank’s business in 2013? In line with Doha Bank’s international expansion strategy, the bank inaugurated representative offices in Australia, Canada, Hong Kong and Sharjah in 2013. The licence from the Reserve Bank of India is yet another milestone and ours is the only Qatari bank to obtain such a licence in the Indian subcontinent in 2013. The bank has successfully completed the initial offer on its “Al Hayer Fund,” which is an open-ended fund seeking medium- to long-term capital appreciation by investing in a portfolio of companies listed on major stock markets across the Middle East region for Qatari individuals. In 2013, our rights issue was oversubscribed by 1.8 times and we had the further issuance of Tier 1 capital instruments to the tune of QR2 billion. With this, the total capital adequacy ratio stood at 16% at the end of 2013. The net profit was QR1.31 billion compared with QR1.30 billion in 2012, representing a growth rate of

58 > QATAR TODAY > SEPTEMBER 2014

customers. Doha Bank has leveraged on technology to provide different alternative solutions to customers such as Online Banking, Mobile Banking, Phone Banking and SMS banking. Service and consistency: We believe in offering second-to-none customer service that will help to retain customers no matter what the business competitors can deliver. Consistently offering quality products and services bundled with attractive promotions and campaigns that are worth our customers’ time and money has made our customers stick to Doha Bank firmly so far. DR R SEETHARAMAN CEO, Doha Bank

0.6%. Our loan growth surged by 21% and had picked up across various sectors. We also took advantage of volatile market conditions to improve our forex income. The return on adjusted average shareholders’ equity and the return on average assets was 17.9% and 2.18% respectively. How unique is Doha Bank in serving its customers ? Doha Bank has focused on three pillars to ensure a continuous success and to provide a unique service to its clientele. They are: Comprehensive products offering: Doha Bank’s wholesale banking can cater to various segments such as contract financing, project finance, SME and trade finance in the Qatari market both through funded and non-funded products. Technology: Doha Bank uses technology as a tool to innovate for the benefit of our

How did you inspire your workforce? Through the Vision Convergence, we highlight the overall mission and the strategy road map of the organisation and align the ideas of workforce into this. Inspiration comes through empowerment of staff. We encourage participative management, thereby the workforce ideas are considered appropriately through the process. What are your plans for Doha Bank? The bank views international expansion as a means to build the brand across the globe and increase geographical diversification and will consider other strategic locations for the establishment of representative offices in the near term. We will also look to capitalise on the infrastructure developments in Qatar and increase market share in government lending. We would like to further embed the SME model across GCC branches and increase collaboration and business flows with Dubai, Kuwait, Abu Dhabi and India.

2013

QATAR NATIONAL CEMENT COMPANY

RANK

RETURN ON ASSET:

RETURN ON EQUITY:

BUILDING THE NATION QATAR NATIONAL CEMENT COMPANY (QNCC) IS AMONG THOSE ENTITIES WHOSE FORTUNES HAVE SOARED EVER SINCE QATAR HAS DECIDED TO UNDERTAKE MASSIVE PROJECTS DURING THE RUN UP TO THE 2022 FIFA WORLD CUP.

NCC is the first cement producer in Qatar which started its operations in 1965 and is 43%-owned by the government and government-related entities. The firm, which trades as QNCD on the Qatar Exchange, is the largest producer of ordinary Portland cement, sulphate-resistant cement, hydrated lime, calcined lime and washed sand in Qatar. QNCC manufacturing units are situated at Umm Bab, close to rich raw material deposits and 82 km from Doha. Total cement production capacity is 14,750 tonnes per day (tpd) and clinker capacity is 11,900 tpd. PERFORMANCE The company’s financial position became stronger as was evident from its net profit which stood at QR436 million in 2013 as against QR425 Million in 2012 and the Earnings per Share (EPS) amounted to QR8.88 in 2013 compared with QR8.66 in 2012. The shareholders equity increased to QR2.4 billion as of December 31, 2013, an increase of 6% (QR140 million). ACHIEVEMENTS The company’s production in both categories of cement OPC & SRC amounted to

3.3 million tonnes during the previous year. The sale of washed sand has increased to 5.6 million tons compared with 4.8 million tonnes in 2012. Sales of calcium carbonate amounted to 14,510 tonnes and the total value of sales revenue was a little over QR1 billion in 2013 compared with QR964 million the preceding year. The company has signed a letter of intent to construct the cement line No 5 with FL Smidth of Denmark for a designed capacity of 7500 TPD clinker at a contract price of QR1.2 billion. MOHAMED ALI AL SULAITI Managing Director, Qatar National Cement Company

3.4 million tonnes during 2013 compared with 3.6 million tonnes during the previous year. The production of washed sand has increased to 4.7 million tonnes during the year 2013 compared with 4.1 million tonnes during the previous year. Calcium carbonate production during the year 2013 amounted to 16,643 tonnes. Sale of all types of cement (OPC, SRC, slag blended cement and fly ash blended cement) increased to 3.4 million tonnes during 2013 as against

“QNCC is carefully growing and expanding its national role in supporting infrastructure development, especially after Qatar won the bid for hosting 2022 FIFA World Cup.” MOHAMED ALI AL SULAITI MANAGING DIRECTOR, QNCC

PLANS QNCC has started trial operations of its Umm-Bab based QR22 million calcium carbonate plant, which will be specoalised in the production of calcium carbonate for the use in water treatment operations, has a production capacity of 250 tonnes per day. QNCC managing director Mohamed Ali Al Sulaiti said the company has entered into anb agreement with Stream Industrial Company to construct the plant. "QNCC is carefully growing and expanding its national role in supporting infrastructure development, especially after Qatar won the bid for hosting 2022 FIFA World Cup," he added.

NET PROFIT

QR436 MILLION

IN 2013 COMPARED WITH

QR425 MILLION

IN 2012 THE SHAREHOLDERS EQUITY INCREASED TO QR2.4 BILLION AS OF DECEMBER 31, 2013, AN INCREASE OF 6% (QR140 MILLION). QATAR TODAY > SEPTEMBER 2014 > 59

affairs > local business > bottom line

10 STEPS TO A

GREAT JOB INTERVIEW

The career experts at Bayt.com present 10 valuable tips to guide you through your next job interview and help you succeed. YOU KNOW THE OLD SAYING, “YOU NEVER GET A SECOND CHANCE TO MAKE A FIRST IMPRESSION.” THAT’S ALWAYS THE CASE WHEN MEETING SOMEONE FOR THE FIRST TIME, BUT ESPECIALLY SO WHEN IT COMES TO A JOB INTERVIEW.

Know your audience Similar to studying before an exam, you must study your prospective employer thoroughly before an interview. 20% of companies in the Middle East find poor preparation to be the most common mistake job seekers make in an interview, as revealed in the ‘Hiring Practices in the MENA’ poll, January 2012. You should familiarise yourself with the role that you are applying for, but also try and gauge the company’s corporate culture, and look through their mission, vision and annual reports.

Respect everyone’s time Being punctual is extremely important in order to create a good impression. Arrive before the stipulated time so that you can acquaint yourself with the surroundings. Look at the directions the day before your interview; you can even do a test drive to the exact location to 60 > QATAR TODAY > SEPTEMBER 2014

be absolutely sure. Remember, it’s important to respect everyone’s time, especially the hiring manager’s.

Dress the part According to the Bayt.com ‘Influence of Physical Appearance on Hiring Decisions’ poll, March 2013, 77% of MENA professionals believe that employers make a decision based on a candidate’s physical appearance. Always remember that understated elegance really makes a difference. When starting a new job, always keep in mind that how you dress will tell your boss and others in the organisation how you see yourself and how you approach the job. The same applies to a job interview.

Avoid the ‘uh’ moment The worst thing that could happen in the interview is blanking out to a question, or saying ‘Uh’ or ‘Um’ repeatedly. Behavioural and technical questions are common in a job interview. Moreover, according to the ‘Hiring Practices in the MENA’ poll, 52% of companies in the MENA region provide training for everyone involved in the hiring process, so you should do an in-depth analysis of all the technical aspects of the job. Practice on answers and revisit your CV and make sure it conveys all your key skills and experience relevant to the job that you are being interviewed for. After doing this, you can chalk out all the typical questions that may be asked during the interview.

Be nice to everyone It’s natural for you to be nervous about your interview, but definitely not an excuse to ignore the admin staff and receptionist. Be as friendly as possible to whoever you meet during your interview. Hiring managers and department managers often ask these people about your overall behaviour and attitude.

Make it about them, not you Interviewees often talk a lot about themselves without ever mentioning how they can add value to the company. Try and cut down on the ‘I’ during your interview and focus more on the ‘you’. Ask intelligent questions to engage your interviewer. Show

them, enthusiastically, how you can be an asset for their company in the short and long term.

Try social media networking Try to network on social media and specifically through professional platforms such as Bayt.com Specialties where you can share content and professional insights and get recommendations and endorsements. 92% of professionals in the Middle East say that good personal branding can help you get more interviews and grow in your career, as stated in the Bayt.com ‘Personal Branding in the Middle East and North Africa’ poll, September 2013. Start by creating a good online profile on Bayt.com People and connect with professionals who can make a real difference in your career.

Know your success stories You must have many success stories from your previous experience. Pick out three where you shine the most. Look for cues to share these stories during the interview. Those cues can be anything from “Tell me about yourself” to “How was your experience in this company?” Everyone loves a good story!

Get feedback and send a ‘thank you’ letter After the interview is over, it’s better not to be left hanging. Closure is necessary. Ask the interviewer when they’ll let you know their decision. Also find out if it’s okay for you to send them a follow up. If there is no response after a week or two, send a follow up with a ‘thank you’ letter. The ‘thank you’ letter is essential to reiterate your interest in and suitability for the job, and to stay top-of-mind with the employer in a favourable way.

Move on It’s easier said than done, but after an interview is over you should move on with your life. You aren’t going to know the hiring manager’s decision the same day, so let go of all your worries and trepidations and start preparing for the next interview. Keep up that positive attitude and success is sure to follow!

ABOUT BAYT.COM

Bayt.com is the #1 job site in the Middle East with more than 40,000 employers and over 16,750,000 registered job seekers from across the Middle East, North Africa and the globe, representing all industries, nationalities and career levels. Post a job or find jobs on www. bayt.com today and access the leading resource for job seekers and employers in the region. QATAR TODAY > SEPTEMBER 2014 > 61

development > tag this

IS THE CRUNCH COMING? In an engaging chat with Director for AECOM Qatar, Steven Humphrey, Qatar Today finds out what kind of roadblocks Doha faces in the run up to the construction frenzy that is set to take over the Middle East in the coming years. BY AYSWARYA MURTHY

ECOM is behind some of the biggest projects in Doha, in almost all segments of the market – the New Port Project, Lusail Expressway, Salwa Road expansion, Hamad International Airport, Msheireb Downtown Doha, projects for Qatar Foundation... We are on the 25th floor of Burj Doha, listening to Steven Humphrey’s growing list; from megaprojects to one-off buildings, AECOM is involved in the areas of “engineering design, project management, cost consultancy, supervision and architecture records and more” and we realise Humphrey is the perfect person to give us a peek into the big picture concerning the construction market in the region. We ask him specifically about how Doha will cope, with construction across the GCC moving into high gear. AECOM has presence across the region – in the UAE, Kingdom of Saudi Arabia, Bahrain, Kuwait... and all these markets have earmarked big bucks

62 > QATAR TODAY > SEPTEMBER 2014

towards infrastructure projects, expected to peak between 2014 and 2019. Could these upcoming projects, specifically in the UAE which also has a deadline to work against, potentially put a strain on the resources needed in Doha? And how are we preparing for them? “Dubai especially would see a lot of Expo 2020-related development in hospitality, transport and infrastructure, museums, healthcare, schools, etc., in addition to the big Expo complex, the airport expansion, development of the Palm Islands, Marina, Business Bay area, etc.,” Humphrey says. “Some of the projects that had been stalled for a number of years are starting to be re-energised. Expo gives the city the confidence it has lacked over the last few years. Now there is more impetus and focus and a lot of plans are being floated. We’ll see in the next 12 months how much of this will turn into real projects.” While like Doha, Dubai also has a tight time frame in place; it, however, doesn’t

have the kind of supply bottlenecks we have to deal with. “Qatar has to import everything,” Humphrey points out, and so naturally, it has to compete for everything. “Very little material is manufactured here. While there is a ready supply chain for some of the raw materials like aluminium, steel and aggregate, there is limited manufacturing for others such as cement, which is imported based on project demand.” While Qatar National Cement Company is expanding, the projections predict that the supply won’t be enough even when the new facilities are fully operational, Humphrey says. “Tiles, air conditioning equipment, sanitary fittings, all these have to be imported, which puts a lot of pressure on land borders, ports and general markets. We don’t have the transshipping capabilities of Dubai port yet and have to rely on land routes. The manufacturers in the region would sooner service domestic markets, considering that the demand is on the rise, before selling overseas with lower margins and higher risks,” he

says. It’s not that the situation is creeping up on Qatar unawares. “The risks were something we saw even during the Asian games in 2008; many of these issues arose then,” remembers Humphrey. “And as soon as the FIFA World Cup was awarded, it was obvious that construction activity was about to spike. True, many of these projects were planned and ongoing, but they weren’t as time critical as they have now become. And now that many of the projects are taking off in earnest and the pieces of the jigsaw are falling into place, the picture will become clearer still as the new port and the highways become operational and some of the pressure on the existing logistics is relieved.” Ideally, Humphrey would like the inter-GCC rail to be up and running soon but knows that that will take longer. Meanwhile, he feels existing resources must be stretched to their limits. “There are some opportunities available to us like expanding the Maseeid port and getting more use out of the Ras Laffan port which is currently under-utilised.” But efforts are already on to prepare for this potential resource crunch and mitigate the risks as much as possible, Humphrey notes. “The government has set up a committee to review prices of primary materials in order to keep costs in check and ensure that there is no price manipulation. There is some stockpiling of key materials, including aggregate, cement, tiles, air conditioning equipment and other strategic supplies, that are likely to be in high demand and certain to yield turnovers, both in private and public sectors. The key is to make sure that operations can continue even in case of a shortage.” Apart from this, there is also competition for labour to deal with, especially for skilled workers who often find more financial reward in the UAE and KSA. The blue collar workforce will be less of a problem, he says, considering there is a bigger supply. “The challenge will be securing the services of this segment at a competitive price. Contactors are bidding and winning work on the assumption of a fixed price. But in a different market with higher costs, these margins will be squeezed.” There are a few reasons why this might happen. General inflation is one. The other is the recovery of the global economy. "This might lead to some pressure as there will be increased demand for labour in other parts of the world as well as in the domestic market of the labour sending countries. In countries like India the benefit of working overseas is diminishing.”

With the GCC becoming less attractive to cheap labour, there is a slowdown; there is also a change in the mix with the workers in parts of Asia that still remain economically challenged, like Pakistan, Bangladesh and certain parts of India. It’s the professional workforce, often driven around particular projects and certain skill-sets, which is going to be a bigger challenge. And this is coming to pass already, again attributed to the upturn of economies in recession-hit countries. “When more options open up, there may be a challenge in drawing them to Qatar, especially when there are difficulties concerning visas, housing, schools and cost of living. It might put people off.” But Doha has its charms, says this long-term resident. “It is a lot more traditional and family-oriented. Most of the pros and cons when compared to Dubai are built around personal

“Local companies also take a different view on the potential risks. They have been through this before and tend to react closer to when there is a problem. International companies sometimes overthink it. The danger in this market is that no one knows for certain what the risks are and when they are going to occur.” STEVEN HUMPHREY Director AECOM Qatar

File photo of the iconic Doha Tower under construction

opinion. The business environments are different. Dubai is a lot more cosmopolitan and is a transactional city, while Doha is a long game. There is no quick win and get out.” In the more immediate sense, there is a need to prioritise and the government is doing exactly that. “There is a focus around what’s critical. The government is careful not to overextend itself and is fighting the temptation to do everything at once. A targeted approach, with emphasis on delivery and achievement, will get things done faster. This means controlling how much work is released and when.” If done in a progressive and structured manner, there is enough time but if everything is turned on at once, a degree of panic will ensue. And since the market is dominated by government and quasi-government entities and the private sector doesn’t hold that much sway, this is

easier to do. It’s of course a balance. “For most big sporting events, the main stadiums are finished closer to the event so that they look brand new. But since there isn’t any existing infrastructure here, unlike in London or Sochi, there is a need to demonstrate to the world that things are happening,” Humphrey says. So some stadiums and related infrastructure have to be in place earlier than what’s normally the case, even at the risk of some of the technology becoming outdated after a long gestation period. So it all comes down to prioritising. While it’s nice to have an eight-lane expressway between Shamaal and Dukhan, is it critical? Some parts of the national strategic plan, like IDRIS, can’t be delayed because it’s needed to improve the country. In Humphrey's opinion, the government has a good handle on this QATAR TODAY > SEPTEMBER 2014 > 63

development > tag this

THE GRAND INCUBATION EXPERIMENT

Is Qatar’s nascent incubation scene delivering what local entrepreneurs need? Do they live up to their promises? Qatar Today speaks to incubators and entrepreneurs, going behind the scenes of this fledgling experiment, to find out what’s working, what’s not and why? BY AYSWARYA MURTHY

64 > QATAR TODAY > SEPTEMBER 2014

t’s an exciting time to be studying Qatar’s emerging entrepreneurial scene. The rules of the game haven’t been established yet. Young entrepreneurs, almost all of them firsttime businesspeople, are plunging into the unknown, trying to hit on that winning formula in a market that’s dynamic at best and unpredictable at worst. It won’t be an exaggeration to state that incubation means more to potential entrepreneurs here than anywhere else. But in Qatar, even this supposedly cushy path to business realisation is littered with broken promises and fumbled, if well-meaning, attempts at support. Like Juha Peralampi, manager of the Business Incubator which is part of the Center for Entrepreneurship, College of Business and Economics, Qatar University, says: “The entrepreneurial landscape in Qatar, as in many other countries, is still being created; mindsets are being reshaped; rules and regulations are being taken down and formed. So there are bound to be mistakes and miscommunication in this ever-changing scenario.” Mission: motivation Entrepreneurs are a volatile lot. For them to stay truly committed to their business and give it their all, their passion metre needs to be constantly reading high. If your stint at an incubator leaves you with your spirit sapped, then all the logistics and funds that are being heaped on you are for naught. And this needs to be a serious consideration in Qatar where entrepreneurship is seldom born out of necessity and there is always an easier alternative. While Razan Suliman’s “beautiful experiment” with ictQATAR’s Digital Incubation Centre (DIC) started like a heady dream, she rues that by the end of it she, like a few others who were incubated with her, felt defeated and distinctly lacking in passion for her project, Bylens. “I was selected for incubation in June but was given an office only in November. By then the fire had kind of died out,” she admits. But more than anyone else, she blames herself for not being able to make the most out of her incubation. “I was lucky to be

incubated. But the timing was all wrong. If I do it all over again now, knowing what I know, I’d do it so much differently.” Her primary regret is taking on too much. “I already had a day job and I didn’t want to hire anyone because I wanted to build this business by myself.” And she did – handling everything from commercial registration to building the website and creating a corporate identity to managing stock and accounts to meeting clients. But at what cost? “I am doing well enough but I could have been doing so much better,” she muses. In fact, if she had hired someone, she could have applied for funding (“I had not wanted funding because I was still bent on ‘doing everything by myself’,” she says, firing a pretend gun into her temple), poured some of it into marketing and advertising and even guaranteed the salaries of a couple of great professional photographers for six months. “I wish someone at the DIC had shook me out of it and told me I was being too ambitious. That I would run out of money if I kept spending what I was earning and that I was too young and inexperienced to know what I might end up needing the money for.”

AHMED ABDULWAHAB Consultant, QBIC

We are a startup ourselves and we wanted to speak to our potential customers about their anticipations, the support mechanisms that were needed and the factors that hindered them. A good portion of the startups might fail at the activation phase; only the truly robust and innovative ones will move on to the next stage.

The matter of money Funding is the universal bane of entrepreneurs everywhere. Investors, especially in this region, are wary of the commitment and competence levels of new businesspeople, while these young men and women in turn want the luxury of experimenting, making mistakes and learning through them. Incubators, to some extent, provide the middle ground. But, quite contrary to what traditional wisdom would suggest, funding is not the only motivation behind entrepreneurs seeking incubation, Ahmed Abdulwahab, previously Head of Incubation and current consultant at QBIC says. One of the entrepreneurs under him espouses the same philosophy. “Money doesn’t solve everything,” says Ehab Nagip, who is working on a social platform for startups to exchange services for free. “Mentorship counts and so does the workplace.” But a workplace is not just a desk and a laptop. “When you are working QATAR TODAY > SEPTEMBER 2014 > 65

development > tag this

RAZAN SULIMAN Co-Founder, Bylenz

I was lucky to be incubated. But the timing was all wrong. If I do it all over again now, knowing what I know, I’d do it so much differently. I wish someone at the DIC had shook me and told me I was being too ambitious.

VICTOR KIRIAKOS Senior Manager of Strategic Projects, Afkar by Intigral

The startup scene in the region is more collaborative then competitive at this stage Ease of monetisation is the biggest challenge for digital startups in the region.

66 > QATAR TODAY > SEPTEMBER 2014

in an environment where everybody is out to challenge themselves and go after their dreams, it is a great motivation,” he says. DIC has come a long way since it started out as a simple managed workspace in 2011. “Within three months of launching we started providing basic services like legal and accounting, 9-10 months later came value-added services like business coaching, mentoring, helping with networking, and in July last year we started our seed fund programme,” says Ahmed Laiali, the Head of Incubation, DIC, ictQATAR. While DIC expects no equity in return for this cash fund, which is as amazing as it is rare, the dispersal has often been erratic, with companies waiting for months for their first round of funding. Predictably, this often affects business development in the worst possible ways. DIC expects at least 50% of the partners to be working full time at the centre to qualify for funding. This is reasonable. But a few incubatees who had hired employees in the hope of these funds coming through were left out in the cold when they didn’t come in on time or didn’t materialise at all. Ali Mussayab, whose Purple Cedar is being incubated at DIC for a little over a year now, is no stranger to this. His animation company is resource-intensive; he needs powerful computers and people with very specific talents to operate them. “We were incubated in February last year but our funding came through only in June, 2013. We had to order our equipment from the States and with one thing or the other, we were only able to set up our office in August and find full-time employees by December,” he says. By then, they were already several months behind schedule. “Technical difficulties added to this and we weren’t able to complete some of our major milestones last year. And in February, without any prior notice, the centre suspended our funding till we showed results.” It was a major blow for Mussayab. “I live with my parents and can survive without these funds, but what about my employees?” he asks. Laiali’s only comment when asked about these problems was that they were “working on it to have it more streamlined”. An oasis in the desert It would be churlish not to recognise the extent of DIC’s contribution to tech entrepreneurship in Qatar. And it can’t be denied that they are doing what they can to jumpstart the external ecosystem. “We are all learning together – us, the entrepreneurs and the new incubators,” Laiali says. The incubators’ maturity level grows as the

entrepreneurs’ mature. “It’s not a one-way street. Sometimes we have to scale up to effect change and other times we listen to the requests from entrepreneurs and try to serve them better,” he says. Mussayab says that there’s a marked improvement in services with every new batch of incubatees. In the new programme, not only can entrepreneurs apply for funding from the earliest stages, but they will also be put through some of the fundamental workshops before they have to hand over their business plans. “This way they know what they are dealing with and are already trained before they formally launch the business. We had to sit through these over the course of a year during which our business was live,” he says. Some of the recent inductees we spoke to were positive about their experience. Among the advantages of their stint at DIC that were listed were the access to regional app analytics market research for free, the availability of expensive software, the elevated status they enjoyed among clients when compared to other startups with no incubator support, a world-class work environment, and respected trainers. Of the seven companies that have completed their incubation programme, Laiali says by industry standards four of them were successful in terms of launching their products and, out of these four, two did well in engaging with customers. But there are those who didn’t make it. “There are some businesses for which the ecosystem is not ready yet. A typical example of this is the e-commerce sector. Qatar still doesn’t have the virtual infrastructure like payment gateways. Additionally we don’t have resource capacity to shorten the cycle to build e-commerce portals and websites. It’s a trial and error process which is expensive.” But then why incubate them in the first place? For the bigger picture, he says. “E-commerce is an area of interest for both DIC and ictQATAR. We have to start somewhere. Maybe the infrastructure will not develop till there is a critical mass of companies requesting for this. Hopefully we can create this critical mass,” he says. As a government entity, DIC has the power to take these kinds of bold decisions. As a government entity, it also has the responsibility to make the environment conducive to tech entrepreneurship by bringing fundamental change in the way we view businesses. A lot of archaic laws like a mandatory physical address and a substantial proof of capital in the early stages are not really necessary for these startups and is in fact

stifling, not encouraging, them. “I can’t hire anyone unless I have a letter of establishment. But why should you force me to rent a place when I don’t need one. I didn’t realise this until I was a month away from graduating from DIC,” Suliman says. “It’s a new culture and the ministry needs to understand that new policies and regulations are in order,” entrepreneur Amal Al Shammari opines. Laiali is well aware of these problems and says the DIC is doing its part to shape future amendments and laws. “There was a public consultant last year for company registration and licensing laws which we contributed heavily to,” says Laiali. The sourest need of the hour, however, is coordination among government organisations and also those that seek to support and foster entrepreneurship. Bedaya, Silatech, Roudha Centre, EQ, they are all working in isolation, doing the same wrong things and getting the same bad results, according to some entrepreneurs. Even between different ministries, there is very little concentrated effort to help out these startups. When Al Shammari approached the Qatar Tourism Authority with her plan – a cultural consultant service that aims at being a general source of information about Qatar for both expats and tourists – they liked the concept well enough but no help was forthcoming. “These are the people who should support it but they were more inclined to merge it with their own operations. I don’t think I’d be able to innovate in such a controlled environment and that would be the death of it,” she says. Back in DIC, it isn’t any easier. “Even though DIC is in the ministry, they don’t seem to have links with other ministries,” says Mussayab, who had expected procedures like applying for registration to be smoother on account of their government affiliation but ended up having to negotiate a bureaucratic quagmire nonetheless. “Secondly, in the animation business it’s very difficult to find talent. There are barely any animators here so we had to get people from outside. But our employees’ visas were rejected twice because of their nationalities. Moreover, our animation products are all cultural and educational, revolving around Qatar and its history. We have been trying to get support from the Ministry of Culture and the Supreme Council of Education but this hasn’t happened. We really shouldn’t have to struggle through these things when we are working directly under the ICT ministry,” he says, and it’s hard not to sympathise with him. To develop the ecosystem and not squander away its potential, a joint effort is

imperative. “There is interest and growth in the region and a lot of people are coming to help develop the startup scene here,” says Victor Kiriakos, the Senior Manager of Strategic Projects at the new Dubai-based incubator/accelerator Afkar by Intigral. “We have had people from Portugal, France, the United States and from across the MENA region apply for our programme. They see real potential here. And we need to work together to make it happen. We try to play our role and partner with people with the same objective as well. It’s more collaborative than competitive at this stage,” he says. Calling a spade a spade In truth, the word ‘incubation’ is thrown around too casually in Doha. And tragically, it has left many an entrepreneur severely disillusioned. Al Shammari is one of them. The young business analyst is currently part of Qatar Business Incubation Centre (QBIC)’s 10-week Lean Startup programme, hoping to be among the first companies to receive incubation here. But before this she had burnt her fingers enough trying to get her business off the ground. Most recently – and this clearly rankles her the most – she had a trying experience at Qatar University. A startup competition, promise of incubation, a fast track into entrepreneurship. It’s a familiar formula. Al Shammari won, was given one of those large cheques for QR50,000, and was promised support in the form of workspace and training. But it only went downhill from there for her. “As it turned out, the funds were not given as money upfront but only reimbursed against any expenses that I might incur when I brought in the invoices. I didn’t have the capital to spend out of my pocket!” she exclaims. Worse still, she had to find out the hard way that workspace that she was offered was not legally recognised as a commercial space by the Ministry of Business and Trade as it was a part of the university. “So that dashed the chances of me getting a business licence. We were given assurances that this would be resolved soon but tons of meetings later nothing has come of it,” she says. While admitting that resolution of the legal status of commercial registration for companies is under process by the Centre for Entrepreneurship, Peralampi defends that decision of handing out funds through reimbursements (while clarifying that the Innovation and Entrepreneurship Contest as well as the reimbursements of the funds is being coordinated by the Center for Entrepreneurship). “Why wouldn’t this

ALI MUSSAYAB Co-Founder, Purple Cedar

There is a marked improvement in services with every new batch of incubatees. We really shouldn’t have to struggle through some of the things [like visas, and government affliation] when we are working directly under the ICT ministry.

QATAR TODAY > SEPTEMBER 2014 > 67

development > tag this system of reimbursements work? This is being practiced widely in many European countries. Although I sympathise with the entrepreneur’s needs, this was a conscious decision taken by the Center for Entrepreneurship to prevent the misuse and mismanagement of funds.” Without going into specifics, he says similar contests have faced these kinds of problems in the past globally. Since the Business Incubator’s launch in September 2013, 29 start-up teams comprising QU students, faculty and alumni have been provided with coaching, incubation space and contact networks. Peralampi also points out that as a university-based incubator, their job is not to compete in the market but rather to complement it. “We have had teams who have gone on to join other incubators and participate and win in startup competitions like INJAZ and Al Fikra,” he says. “There is actually a lot to do before you reach a level where you might need to start thinking about funding and registering your company. From business ideation to profitability studies and legal considerations to designing your sales and marketing, the Business Incubator at the Centre for Entrepreneurship prepares you on the prerequisites, whether it takes two months or twelve.”

AHMED LAIALI Head of Incubation, DIC Within three months of launching we started providing basic services like legal and accounting, 9-10 months later came value-added services like business coaching, mentoring, help with networking and in July last year we started our seed fund programme. There are some businesses for which the ecosystem is not ready yet. A typical example of this is the e-commerce sector.

68 > QATAR TODAY > SEPTEMBER 2014

A new chapter After a long time in the pipeline, QBIC finally took in its first round of incubatees and there is a sense of optimism surrounding the venture. Suliman hopes that they wouldn’t be as bound by red tape as government organisations. Al Shammari is very satisfied with some of the advanced workshops she has attended in the course of the Lean Startup programme and is eagerly awaiting the next phase. She is very clear about the kind of help she hopes for from QBIC. “Foremost, my business license; QBIC ought to ensure it meets all the criteria – logistic and monetary. A checklist of requirements to launch my business would also be great,” she says. “Veteran consultants with partners and experience in the field,” she goes on. “And finally, a small capital for me to try and experiment with my original ideas.” How much of this is in QBIC’s own agenda is hard to say. They have a whole new approach to incubation, according to Abdulwahab. “I’d even say it’s the fundamental approach to incubating a company.” QBIC hosted several focus groups made up of current and potential entrepreneurs to listen to what they really wanted. “We are

a startup ourselves and we wanted to speak to our potential customers about their anticipations, the support mechanisms that were needed, and the factors that hindered them,” he says. In fact, even the online application for the programme was developed in collaboration with those who’d eventually be filling them up. Designed by serial entrepreneurs like Abdulwahab himself, the programme follows the lifecycle of an enterprise. Starting from speaker series that inspire the community to startup sessions that identify quality entrepreneurs and business ideas, QBIC will take new companies through a 10-week Lean Startup programme (“the first ever in Qatar”) which will help turn ideas into viable businesses. At the end of the programme, the companies pitch their plans on Demo Day and a select few are taken forward for incubation. Or rather, as Abdulwahab likes to call it, “the scale up”. “This is where we provide the space, smart financing (which are basically just add-ons) and hands-on coaching by experienced entrepreneurs (which he says will be the crucial differentiator contributing directly to the success of the company). For the three months, we won’t be asking the companies to draw up a business plan but instead focus on customer validation.” Is there a market for your product/service? Will your customers pay and how much? “Once this can be demonstrated, then the company will be officially registered and then new rounds of funding will be released (in exchange for equity),” he says. He expects that many will change their business models and/or moving forward a good portion might fail but the truly robust and innovative ones will move on to the next stage. How well will this mechanism work and how will entrepreneurs react to this? This will be answered in the coming months. What do entrepreneurs want? Some of the other services like legal and accounting are also god-sent for these novices. But mentorship and coaching are where incubation centres can really stand out and attract the best of the entrepreneurs. However, there is training and there is training. Sometimes the coaching can be of the best quality but still an utter waste if the entrepreneur was not in the right phase to receive it. Some of the workshops at QU’s Center for Entrepreneurship were put together without any thought of who they were catering to, according to Al Shammari. “For example, one class dealt with creative

thought and how to come up with winning ideas. I didn’t need more ideas; I needed to launch the one I already had.” Sadly, this wasn’t her first tryst with unhelpful workshops and talks and lectures. “I was really disappointed with Enterprise Qatar as well. They are a government-supported entity with a huge budget and I still had to pay for their classes, subsidised as they may be. ” And Roudha Centre is another organisation that is blatantly reneging on its obligations, according to her. “There are no workshops, no funds.” she says. Abdulwahab is well aware that entrepreneurs here have had up to their necks with “training”. “We don’t put you in a class to learn about theoretical business cases; instead you’ll be exposed to action-oriented teaching with exercises conducted by veteran entrepreneurs who have been through this process,” he says. At DIC Mussayab has had the opportunity to interact with the likes of Henri Holm from Rovio (of Angry Birds fame), and the Toon Boom team. “There are a couple of other companies at DIC into 2D animation and gaming, so this was extremely beneficial for the lot of us,” he says. Additionally he has been given a crash course in innovation management, agile project management, digital marketing, finance, and more. The pool of mentors and trainers is still pretty small here in Qatar though. Laiali illustrates this by talking about DIC’s difficulty in bringing in good consultants who truly understand what startups need. “For example, we can invite someone to speak about finance but that is a vast, generic topic. But what we need is someone to talk about what ICT startups need to know about finance. There is a lot of customisation required according to subsector and company size,” he explains. Kiriakos is certain they have put the finger on the nub when it comes to what entrepreneurs want. Launched officially at the end of last year, Afkar is currently in the middle of its first intake of companies to be grown at Afkar for the next three months. For him, the most important value proposition Afkar has created for its incubatees is hands-on mentoring and access to market. “Each incubator is different. The more value it provides, the more attractive it is for entrepreneurs. In our case, since Intigral is a digital media company which creates and sources digital content for our clients, who are major telcom operators in the region, we decided to create this programme to nurture startups that sit within our scope of work to create innovative products which

A Lean Startup session in progress at QBIC

we can then help take to market. We have the experience, with experts in various related fields working within the organisation, and because of our understanding of our clients and their needs, we know what kind of products and services are marketable; we, in fact, chose the companies based on our clients’ needs and put our incubatees in touch with the right people once they are ready,” he says. It’s this kind of mentorship and ease of monetisation (which, Kiriakos says, is the biggest challenge for digital startups in the region) that entrepreneurs treasure more than infrastructure, logistics and funds. “We are not on par with mature entrepreneurial markets like Silicon Valley which is teeming with serial entrepreneurs; so we have to hand-hold our companies a bit to minimise mistakes and increase chances of survival. Failure is very common in this ecosystem,” he says. But paradoxically, it is this failure that we have to learn to embrace; all of us – entrepreneurs, investors, incubators. Because in this scheme of things, “results come from chaos,” according to Peralampi. “There is an element of testing, partially failing, learning and adapting.” And as long as there are people like Laiali who are committed to providing a rare path to “self actualisation” for Qatari youth; as long as there are mentors who are convinced of the “ideas, enthusiasm and unexplored potential” of this young ecosystem; as long as there are dreamers like Al Shammari who don’t give up despite frustrations (“More than my business, I believe in the new economy we are trying to create”); it’s safe to assume that we are on the right track

AMAL AL SHAMMARI Co-Founder, Embrace Qatar

More than my business, I believe in the new economy we are trying to create. It’s a new culture and the ministry needs to understand that new policies and regulations are in order.

QATAR TODAY > SEPTEMBER 2014 > 69

development > tag this

MIGRANT LABOUR ISSUES

UNDER REFORM

WHEN QATAR FOUNDATION RELEASED A REPORT TITLED MIGRANT LABOUR RECRUITMENT TO QATAR, EXAMINING FOREIGN LABOUR RECRUITMENT, THE FOREIGN MEDIA LARGELY IGNORED THIS BALANCED STUDY THAT ESTABLISHES THE CIRCUMSTANCES THAT GIVE RISE TO BASIC HUMAN RIGHTS VIOLATIONS DURING LABOUR RECRUITMENT. 70 > QATAR TODAY > SEPTEMBER 2014

“It is important for us to ensure contractors and their subcontractors do not require migrant workers (their employees) to pay recruiters anything for the jobs they are hired to do.” MOHAMMED BAKHAMIS Director of Health, Safety & Environment Qatar Foundation

ohammed Bakhamis, Director of Health, Safety & Environment at Qatar Foundation, says that, based upon the findings, the report will offer recommendations for reform that will reduce or eliminate labour and human rights violations - and stimulate discussion on the issues raised. With increasing criticism of labour rights violations in Qatar by a plethora of international organisations and the media in the lead up to preparations for the World Cup, some of whom even predicted that more than 4,000 migrant workers would die by the time Qatar holds the 2022 World Cup, this report riposted that the blame lies not entirely on the country that provides work but also on the agencies that recruit workers from their respective countries. The report was not a response to international media criticism, “but because this was the right thing to do”, according to Bakhamis. He stresses that the initiative is dedicated to addressing the issue of migrant workers’ rights in a comprehensive and transparent manner as part of Qatar Foundation’s continued support of Qatar National Vision 2030. Qatar Today examines the report exhaustively and probes Bakhamis about the ambiguities and concerns that the workers issue presents. What was the reason behind this study? Qatar Foundation first launched its Mandatory Standards for Migrant Worker Welfare in April 2013, as part of the Migrant Worker Welfare Initiative. This followed more than two years of research, consultation, discussion and drafting. We are adopting a holistic approach to this issue, both within

Qatar and outside, to ensure that human dignity is paramount when it comes to the treatment of all guests in this country. As the current 160-page report on recruitment demonstrates, many migrant workers arrive in Qatar already heavily in debt due to unethical practices of unscrupulous recruitment agencies in their home country. We are determined to address this issue as well as many others that have the potential to negatively impact upon migrant workers’ daily lives. What are the salient features of Qatar Foundation’s Mandatory Standards for Migrant Worker Welfare for Contractors and Subcontractors (QF Mandatory Standards)? Approx. how many workers would come under the QF Migrant Worker standards? What percentage would they be of the total labour force? How do you make sure they are being implemented across QF’s whole body of work? Overall, our goal is to protect the rights of all workers who are employed on QF-related projects, including through contractors and subcontractors. We believe that our charter and detailed standards are genuinely progressive and designed to be a live document that can be adapted as circumstances dictate. There are many important features to the initiative. For example, we recommend that the authorities protect all workers by ensuring proper and timely payment for work in accordance with Qatari law. Arrangements should be established that allow workers to have bank accounts in Qatar and require all contractors and subcontractors, pay salaries directly into the bank account as in the case of Bahrain. It is important for us to ensure contractors and their subcontractors do not require

migrant workers (their employees) to pay recruiters anything for the jobs they are hired to do. This will eliminate the debt bondage and corrupt practices of kickbacks from agencies to employing companies that only the poorest low-skilled workers are paying for. These types of new standards will be accompanied with comprehensive administrative provisions for monitoring, policing and penalising violations. It has been estimated that as of 2011, around 450,000 blue-collar workers were employed in the construction industry in Qatar, with around 30,000 employed in Qatar Foundation’s various capital projects. Under the terms of our charter, we are committed to ensuring that all workers employed on QF-related projects are paid a fair wage, and we are working with contractors, subcontractors and manpower agencies to ensure that this is the case across the board. Put simply, companies which do not comply with the terms of our migrant workers charter will be excluded from the selection process for future contracts with QF. Does the blame lie squarely on the countries sending the labour force? How is it possible for Qatar to ensure a streamlined and ethical recruitment process? All five main “labour sending” countries of India, Bangladesh, Sri Lanka, Nepal and the Philippines have legislation with specialist ministries and departments dedicated to encourage labour emigration and to protect the welfare of their nationals abroad. Unfortunately, the lack of proper regulation and a highly competitive private sector involvement in recruitment, through misunderstandings and/or corruption, have in some cases fostered, rather than prevented abuse of the system. That being said, the report also identifies a level of collusion QATAR TODAY > SEPTEMBER 2014 > 71

development > tag this MIGRANT LABOUR RECRUITMENT INTO QATAR A LOOK AT THE REPORT’S RECOMMENDATIONS

Government-to-government collaboration to ensure standardised ethical recruitment practices through agreements that could include electronic internet recruitment. Through GCC collaboration, this could be developed for the region as a whole.

Recruitment fees should be re-classified as a form of “bribe” extorted by recruitment agencies and banned. Employing companies should pay for all recruitment costs (fees and charges) as is the norm for more highly skilled workers and professionals.

Ethical recruitment agencies must be employed and sub-agents in local regions, another source of deception and exploitation, should also be regulated, brought under ethical agencies, or not used at all through the establishment of a comprehensive accreditation process.

Agencies in Qatar who supply (or lease) labour on a temporary basis may be convenient alternatives for contractors and subcontractors but they need to be monitored to ensure compliance with ethical recruitment standards to ensure they are not used to avoid the responsibilities of direct hire.

A standardised contract could be developed in conjunction with all stakeholders that makes terms and conditions of employment clearly understood by all parties, including detailed termination conditions and liabilities linked to exit visa and NOC rights, in addition to a more explicit set of procedural rules governing issuance of the demand letter, signing of contracts in native language, etc. Regardless of whether such reforms take place or not, sponsor denial of an exit visa or NOC should have automatic, independent and speedy judicial review and legal representation with rights of residency and employment until resolved (unless criminal charges are involved).

Qatari contractors and subcontractors and their labour suppliers in Qatar should be carefully monitored to ensure that the visas of workers are commensurate with the positions they have filled. This will require collaboration with the Ministry of Labour.

07 08 09 10

An assigned minimum wage for all occupations in the construction sector in Qatar, regardless of nationality. Sufficient, decent and culturally appropriate food should be provided, the cost of which should not be linked to wages.

Arrangements should be established that allow workers to have bank accounts in Qatar and require all contractors and subcontractors to pay salaries directly into the bank account (as is the case in Bahrain).

The Qatar authorities and their clients should establish a policy that guarantees workers an exit visa or a No Objection Certificate (NOC) for transferring from one employer to another.

The Qatari government and its clients should standardise better predeparture and/or post-arrival orientation seminars. Migrant workers need to be better prepared regarding rights and responsibilities as well as finance, health and family issues.

between recruitment agencies in the origin countries and employing company personnel and inadequate government oversight in Qatar. In order to change this, a serious and systematic campaign needs to make clear to all countries of origin (all governments, recruitment agencies, brokers and their associations) and those in Qatar (employing companies and organisations, labour suppliers, placement agencies and embassies) that labour to Qatar must arrive debt free 72 > QATAR TODAY > SEPTEMBER 2014

and without having paid recruitment fees, costs and charges from their salaries before departure or after arrival. At the same time, in support of this campaign, there is an urgency to establish the infrastructural requirements for the sustainable implementation, monitoring and policing of the QF Mandatory Standards for Migrant Worker Welfare, countrywide and internationally. Perhaps the most urgent requirement is the establishment of an accreditation and training system for ethical recruitment agencies who will become the exclusive suppliers of labour to Qatar. Furthermore, the Qatari state and its clients are generous donors to charities and the needy around the world and invest heavily in politics and property, tourism and technology, art and education. Therefore, application of funds towards the radical reform from the current system to the ethical recruitment of migrant workers would not be onerous, as we can use this leverage to ensure the countries we are working with are in compliance with ethical recruitment standards. Previously, such studies and reports have been made but never implemented. What according to you should be the next step? The next steps, and several more steps, have already been taken. Our work did not end with the drafting of our Migrant Workers Charter and Mandatory Standards. On the contrary, the Recruitment Report heralded the onset of a determined and ongoing effort to address all of the issues relating to migrant workers in Qatar. We have a dedicated and highly motivated team who are working full time to implement the initiative. The recent publication of the recruitment report should be viewed as another step in the right direction, part of an overall plan to permanently improve the living and working conditions of all expatriate workers in the country. Indeed, the early findings of the research on recruitment that led to the current report had informed the drafting of the QF Mandatory Standards back in 2013. We are working closely with other stakeholders to encourage the widespread adoption of the principles set out in our Migrant Workers Charter and Standards. The government has already announced that the State’s labour laws are under urgent review, and we are already seeing results from this review. Just as QF is determined to address this issue, I am confident that this determination is shared by all relevant stakeholders

development > tag this

TRADING WITH OUR NEIGHBOURS Why has the profile of intra-GCC trade remained almost constant (in proportion to total trade) over the years? We go behind the scenes to find out what’s holding back the bloc. BY APARNA SHIVPURI

he issue of boosting intra-regional trade within the GCC has been in existence since the Council was established in May 1981. The six GCC countries - Bahrain, UAE, KSA, Oman, Qatar and Kuwait – have implemented numerous measures to push this agenda forward. Even though trade flow

74 > QATAR TODAY > SEPTEMBER 2014

within the Council has gone up, it hasn’t achieved the desired results. According to the International Monetary Fund (IMF), in 1980 trade flows among the GCC countries were at approximately $8 billion (QR29 billion), which was about 4% of the region’s total trade with the rest of the world. By 2008, it had reached $67 billion (QR244 billion), which was equal to 6% of the total trade.

According to data from the Bahrain Ministry of Industry and Commerce, at the end of 2012 intra-GCC trade was close to $100 billion (QR364 billion). According to a report by Booz & Company, the European Union’s common market generated 2.75 million jobs over a 15-year period and 2.2% of additional GDP. These gains were due particularly to the standard-

isation of customs and border regulations, which facilitated the movement of goods, services and labour as highlighted in a report on GCC integration. There is no denying that the countries have been working towards promoting transport linkages in order to foster economic integration. The team at Etihad Rail reconfirms the importance of transport linkages and highlights that strong transport links are paramount for developing intra-GCC trade. Transport and trade are inextricably linked and it is not possible to have trade of goods without being able to transport them to the end customer. The Dolphin pipeline, which transports natural gas from Qatar to the UAE and on to Oman, serves as an example of how cross-border initiatives can create value for all stakeholders. According to Dr Kai Chan, Advisor at Emirates Competitiveness Council, currently there is not a great deal of intra-GCC trade. The major export destinations for the GCC countries are Japan, USA, China, Singapore, South Korea, India, and Thailand. A good majority of the exports are oil- and gas-related. In fact, even though total exports was nearly $1 trillion (QR364 trillion) in 2013, over 70% of it (measured in monetary terms) was accounted for by petroleum. This leaves just $272 billion (QR990 billion) in non-oil exports. So although the GCC region as whole has a combined GDP of $1.6 trillion (QR5.8 trillion) (ranked 12th globally - an economy slightly larger than Australia, but smaller than Canada), non-oil exports would rank the region 19th globally - and the lion’s share (75%) of that is from UAE alone. So as whole, the region does not produce many tangible non-hydrocarbon goods for export into the global market or the regional market. What it does export - beyond petroleum and their derivatives - are agricultural and primary goods (e.g. dates, fish) and, to a lesser extent, metals and textiles, while importing most of

“The hydrocarbon industry will need to focus on ways to make the supply chains sustainable and cost-effective if they want to maintain, or even exceed, their trade within the Gulf region.” ABDULWAHAB AL SADOUN Secretary-General Gulf Petrochemicals & Chemicals Association

everything else, but particularly finished goods (vehicles, electronics, etc.) and food. As a whole, the bloc is a large economy, but driven primarily by oil - it accounts for almost 50% of the GCC GDP. Only the UAE and Bahrain have made inroads in diversifying their economy with hydrocarbon accounting for 30% and 20% of GDP, respectively. Dr Chan further adds, “Similarly, for imports, the major import partners of the GCC countries are India, China, USA, Germany, Japan, South Korea, France and Saudi Arabia. But the inclusion of Saudi Arabia in that list is a little misleading. Saudi Arabia is an oil economy and oil accounts for over 50% of GDP and 90% of exports. So although Saudi Arabia may be showing up in the list of top import sources for some of the other GCC countries (Qatar, Bahrain, Kuwait) it is not supplying the other GCC nations with the primary imports of the region, namely: machinery and transport equipment, chemicals, food, motor vehicles, textiles, manufactured goods, construction materials, clothing.” Dr Abdulwahab Al Sadoun, Secretary General of the Gulf Petrochemicals & Chemicals Association, reinforces the view

even for the petrochemical industry. “Due to the relatively small regional markets, combined with the fact that the products portfolio of the industry throughout the GCC States is largely identical, the petrochemicals industry in the Gulf region adopted an export-oriented approach since its early production days in the 1980s. In 2012, the industry’s export market share accounted for 80% of the total output. This translates into 60.7 million tonnes of petrochemicals products valued at $55 billion (QR200 billion). The share of the GCC markets was 3.7 million tonnes valued at $4.8 billion (QR17.5 billion).” He further adds that they have been witnessing a steady double-digit rise in cross-border petrochemicals trade between the GCC countries – their research has shown that in the last 10 years, intra-regional GCC exports have grown cumulatively by 13% every year. Obviously, this is a positive trend, and there is also plenty of room for improvement. Exports are aided by associate service industries like logistics, transport and shipping, so the challenges for the petrochemical companies over the next 10 years will be in the optimisation of the supply chain. The industry will need to focus on ways to make the supply chains sustainable and cost-effective if they want to maintain, or even exceed, their trade within the Gulf region. With all the best intentions in place, what have been the road blocks to trade and economic integration in the GCC? Is it the lack of infrastructure or a coherent policy? According to Etihad Rail, it has been the latter. Soft infrastructure (policies, regulations etc.) challenges are a greater bottleneck than any hard infrastructure challenge because they introduce costs invisibly either through lost business opportunities or costs that aren’t actively tracked or managed. Due to this, it’s harder to get these issues tabulated to get the right people to fix QATAR TODAY > SEPTEMBER 2014 > 75

development > tag this GCC COUNTRIES TRADE COMPOSITION

$ BILLION

Source: CIA Factbook

1,200 1,000 800 600 400 200 0 -200 -400

"The fate of intra-GCC trade depends on how well the region can diversify its economies." DR KAI CHAN Advisor Emirates Competitiveness Council

INTRA-GCC TRADE FLOW AMONG THE GCC COUNTRIES

QR29 QR244 QR364

BILLION (IN 1980)

BILLION (IN 2008)

BILLION (IN 2012)

76 > QATAR TODAY > SEPTEMBER 2014

-600 KSA

UAE

QATAR Oil exports

KUWAIT Non-oil exports

them. Dr Chan further adds to this and states that much of the roadblocks to increased trade in the GCC region are structural – the economies have little to trade with each other since they are all abundant in oil and gas and short on producing finished goods and foodstuff. Moreover, there are impediments to trade in the region. According to the World Bank, the region as a whole has yet to smooth out frictions for doing business: The average (GDP-weighted) ease of doing business ranking is 38. The region’s unified (GDP-weighted) ease of trading across borders ranking, however, is much lower at 57. And this figure is propped up very much by the UAE, with a rank of 4, while Kuwait drags the group average with a rank of 104. These rankings are the result of red tape and laws that make it difficult (with the exception of the UAE) for entrepreneurs and business owners to function. Although GCC-wide integration initiatives have produced encouraging results, much more needs to be done. With global economic competition intensifying, GCC states need to push forward with even deeper integration. But what does the future hold when it comes to trade among these six countries? Dr Chan is cautiously optimistic about it and lays great emphasis on the importance of diversification. “The fate of intra-GCC trade depends on how well the region can diversify its economies. In the short term there is not likely to be significant changes. With much oil wealth there is no pressure for structural changes in Kuwait, Saudi Arabia, and Qatar. For any real changes

OMAN

BAHRAIN

GCC

Imports

there will need to be more industrialisation and more development of sustainable agriculture. Here much will depend on bringing green technologies that will enable smart water usage and take advantage of the country’s geography (e.g. abundance of sunlight).” He also points out that the construction of the GCC railroad network will help facilitate intra-GCC trade, but only if countries pursue diversification. Dr Al Sadoun seconds the importance of the rail network, especially for the petrochemical sector, and states, “The emergence of a GCC-wide rail network, for example, will be a huge opportunity for the petrochemical industry, as railways can move petrochemicals from point A to B in a safe, secure and timely manner. Railways can also transport a higher volume of petrochemical products, so trains provide a cost-efficient option for companies that are exporting their products in the region.” It is quite clear that, while work is being done towards developing the infrastructural links which will go a long way in promoting trade among these countries, advances need to be made on the policies and regulations. The GCC countries need to adopt non-competitive policies that work towards the creation of complementary economies. This growth in intra-GCC trade will also strengthen the position of GCC countries globally and make them less dependent on the rest of the world and also streamline the flow of goods, services, capital and labour. Do we need more reasons to work towards greater economic integration?

business > tag this

A VOUCHER FOR

SUCCESS

One Australian expat in Dubai grew her company from a one-woman show born out of an internet café to a multi-million dollar global enterprise. This is her story. BY ANEY MATHEW

“We now source and manage 'buy-one-get-one free' offers from more than 10,000 merchant partners worldwide, print 352 million vouchers per year and put in $1.3 billion (QR4.73 billion) into the global economy.” 78 > QATAR TODAY > SEPTEMBER 2014

usiness in the GCC usually means starting a franchise of some famous, global product and cashing in on the identity of the celebrity merchandise. International brands are always looking to get a foothold into the affluent, almost evergreen market that seems to exist here. What is rarely heard of, however, is a product or an enterprise that has originated from within the GCC and made its way successfully not only to other countries in the region but also beyond, testing international waters and successfully expanding in countries as far as in Asia, Europe and Africa. The Entertainer is a UAE-based international company, founded in 2001 in Dubai. It started on the simple concept of selling “buy-one-get-one-free” vouchers in a book form. What started as a one-woman venture is today a multi-million dollar enterprise employing nearly 200 people in seven global offices. The company currently has 52 products, which are sold across 40 destinations in 15 countries. Keeping pace with

the latest in technology, today the coupons are available as printed vouchers as well as an app that can be used on smartphones. “When I started the Entertainer, I was on my own; the business then branched out within the UAE. Slowly I ventured out and Qatar was the second country that the Entertainer went to – about three years later. Today, I can look back and say we have really grown. Currently our products have not only become popular in every single country in the GCC, we have spread quite wide; we operate in countries like Singapore and Hong Kong in the East, the UK and Cyprus in the Wes,t and South Africa down South. The Entertainer has a book specific to each country it operates in, offering “2-for-1” vouchers from various merchant partners. These include high-end and casual restaurants, attractions such as water parks and golf courses, hotel accommodations, spas and health and fitness clubs,” says Donna Benton, Founder and CEO of the Entertainer. Discussing further the impact the company has made on the market, Benton adds: “We also run a lot of third party, white-label products for companies such as

MasterCard and loyalty programmes for banks and corporations. As a matter of fact, we currently service over 200 corporate clients. We now source and manage “buy-oneget-one free” offers from more than 10,000 merchant partners worldwide and put in $1.3 billion (QR4.73 billion) into the global economy. Simply put, we print 352 million vouchers per year – all of our portfolio put together,” she adds. The genesis of the Entertainer points to a rather modest start. When Benton, an Australian, moved to Dubai in 2000 in response to a job offer, her expectations were simple. Like scores of expatriates who make their way to the GCC, she had hoped her short stint in the Gulf would help her save some money before she returned home. Unfortunately – or fortunately in her case – the job offer didn’t work. Within four months of arriving in Dubai, Benton started the enterprise out of an Internet café. For the first year of the Entertainer, she was the sole employee. Benton signed on merchants, designed the book, conferred with printers, signed the distribution deals and, once the books were printed, set out to the streets to start selling her product. Fast forward to 2012, the Entertainer was approached by Abraaj Capital – one of the largest SME private equity companies in the world. Abraaj acquired a 50% share in the company in a multi-million dollar deal. “This hugely helped with our expansion; as a result, we were able to achieve in three

years what we would have done in eight,” explains Benton. This year, in another first, the enterprise has launched the Entertainer Smartphone App. The software works across all smartphone platforms and can either be purchased separately or downloaded freely with the purchase of the book, thus enabling those with the hardcopy to take advantage of the benefits of the application. Providing an insight into the company’s first move into the digital world, Benton says: “The primary focus of the development of the app has been two-fold: to provide our customers with a convenient solution for redeeming their offers “on the go,” and to help us acquire invaluable data on their profile, lifestyle habits and usage trends.” “The benefits of the app to the customers are several; among others, it provides them with information on our digital, monthly “member-only” offers, which can be

redeemed through smartphones – without the need for printed vouchers. It is also a great way of being updated on new products that are being continuously added. Throughout the year we add additional merchants to existing packages. For instance, in Qatar we have 30 new additions available for redemption through the digital platform so far this year; these are not available in the books.” “The software incorporates several friendly features like advanced location searches on where the Entertainer vouchers can be redeemed, searching for our merchant partners or their products by “type”, and downloading and redeeming digital voucher bundles while travelling, that can be used at any of our destinations worldwide. Most importantly, it is user-friendly and can be downloaded worldwide,” adds Benton. The company has been making major strides into the international market, making its presence felt across three continents. But that has also meant staying one step ahead of the competition and those trying to duplicate the business. So how has the Entertainer managed to keep its edge? “When you are passionate about something, you always come up with new, exciting ideas. We are always evolving on the way, by introducing new products and entering new markets. When we launch our product into a new country, we do a feasibility study. We prefer to go deeper into the countries we are in, rather than to just spread wider globally.” “It can be quite challenging when you have offices all over the world. We are very keen to ensure our staff are motivated and stay connected. So we have tools and systems in place to keep our personnel in touch with the different regions and the head office”, explains Benton. The company is focussed on the future with further plans for growth. Close on the heels of the success of its smartphone app, the company is gearing up for another first – franchising. In response to interests from various quarters, the Entertainer has established a franchise model that should see its market expand and advance. With about 30 keen prospective clients, the Entertainer is set to lock into its first country this year and see the commencement of a franchise begin operation in 2015. With the steady growth the company has been enjoying since its commencement with Benton at the helm, the Entertainer seems poised for further growth both within the region as well as globally QATAR TODAY > SEPTEMBER 2014 > 79

EDUCATION SPOTLIGHT

SEEDS OF THE FUTURE

80 > QATAR TODAY > SEPTEMBER 2014

From KG to PG, Qatar's far-reaching reforms have impacted every shade of the education spectrum

QATAR TODAY > SEPTEMBER 2014 > 81

EDUCATION SPOTLIGHT

BACK TO THE BASICS

Much of the investment into education over the coming years has to focus on primary and secondary level education which is clearly the need of the hour.

he role of a robust education system in developing the countryâ&#x20AC;&#x2122;s intellectual capital has always been uppermost in the minds of policy makers and regulators over the past decade. Diligent efforts in this direction are apparent in the fact that Qatar currently ranks 4th out of 148 countries in terms of quality of the education system, as per the latest Global Competitiveness Index. But another, more immediate, concern driven by the lack of sufficient education institutions is starting to come to the light â&#x20AC;&#x201C; its direct impact on the ability to attract

82 > QATAR TODAY > SEPTEMBER 2014

talent into the country, many who are worried about not being able to find school seats for their children. The total number of students in the country is growing at 4.0% annually. The First Investor, a PE firm, forecasts a 30% to 40% rise in enrolments at private schools in Qatar over the next three to five years. The preference for private schools is apparent in a Booz & Co. report that shows that even though nationals and expats in Qatar are paying considerably higher annual fees in private institutions, they are willing to spend even more. Existing private schools in the country are also showing promising results with PISA

(Programme for International Student Assessment) data from Qatar revealing that 12 out of the 14 best-performing schools are private. Of late, government reforms have changed the medium of instruction from English to Arabic in certain schools because of reports that the unimpressive performance of students in these independent schools was partly due to their inefficient English language capabilities. But students are now raising concerns about whether moving away from English during their preliminary education is affecting their employability and chances to be accepted into higher education institutions.

Qatar Ranking - Quality of Education Parameters

Rank

Quality of primary education

Quality of the educational system

Quality of math and science education

Quality of management schools

Internet access in schools

Availability of research and training

Extent of staff training

5 Source: Alpen Capital, GCC Education Industry 2014

These and other factors have led the government to push for increased private sector investment in the sector – and rightly so. The year 2012 recorded no venture capital investments in the industry, mostly due to the high cost of setting up business in the country and the tough regulatory environment. New and promising industry-specific sectors such as vocational training, finishing schools, child-skill enhancement, and e-learning are emerging in the GCC education industry which could be promising for private players, according to Alpen Capital. Accordingly, the Qatar Development Bank (QDB) and the Supreme Education Council are planning to offer a 15-year education loan to private investors for setting up educational institutes in the pre-primary, primary, and secondary segments. At a subsidised interest rate of 3-4% p.a., this loan will allow investors to finance up to 70% of their overall project cost. The SEC will conduct the feasibility study for the education projects. Driving investment (Courtesy: Booz & Co., The Coming Expansion of Private School Market in the GCC): Governments must take steps to

ensure that regulations are clear, stable and consistently applied, and that all market participants are able to compete on an even footing. They should also balance consumer needs with operators’ right to increase revenue by instituting full transparency in tuition fee regulation. Increase awareness of the prospects for the sector among local and foreign investors by actively engaging the industry through conference participation, marketing campaigns, and direct engagement. Governments could take steps to reduce the capital burden on investors contemplating private school ventures by facilitating access to debt capital. Easy availability of market research information for potential market entrants Address the shortage of national teachers by implementing new teacher-training programmes, so that it doesn’t have to compete for expat teachers. Qatar has been taking many of these steps. In fact, it released the ninth Annual

QATAR PRIVATE-SCHOOL MARKET DRIVERS (2010 VS. 2020) Total K–12 Enrollment

Private-school Share (%)

Total Private K–12 Enrollment

Average Tuition Fee (US$)

Total Market Value (US$ Millions)

2010

158,000

48%

76,000

5,700

430

2020 (Low)

246,000

49%

140,000

7,660

1,064

2020 (High)

246,000

50%

143,000

10,200

1,459

Source: Booz & Company

INDEPENDENT SCHOOLS PROVIDE FREE EDUCATION TO MORE THAN

100,000

LOCAL STUDENTS.

AND ACCOUNT FOR

24.7%

OF THE TOTAL SCHOOLS IN QATAR SEMI-INDEPENDENT SCHOOLS CONSTITUTE

21.1%

AND PRIVATE SCHOOLS MAKE UP THE REST. THE PRIVATE SCHOOL MARKET IN THE COUNTRY STOOD AT

$433

MILLION IN 2010, IN TERMS OF ANNUAL TUITION FEE.

Report on Education in the Schools of the State of Qatar a few months ago which, with its 234 tables and 79 charts, shed light on various aspects of schooling in Qatar, from teaching hours per week and average number of students per computer to parents’ satisfaction with the schools and average annual expense on education per student (QR13, 000). The State of Qatar is also pouring into the sector an unprecedented $7.2billion or 12.2% of its total expenditure for 2014, with a 100% increase in this allocation for the next five years. A majority of this is going towards schools. The Qatari government has announced in April 2014 the setting up of 85 new schools in the country over the next 18 months QATAR TODAY > SEPTEMBER 2014 > 83

EDUCATION SPOTLIGHT

SEC ADDS NEW SCHOOLS IN SEPTEMBER The Supreme Education Council listed 15 new schools – six kindergarten and nine primary – that are to start operations in September. This is apart from seven branches of existing schools that are set to open across the city. NEW PRIVATE SCHOOLS AND KINDERGARTENS EXPECTED TO OPEN FOR ACADEMIC YEAR 2014-15 NO

NAME OF SCHOOL

TYPE OF SCHOOL

LEVEL AVAILABLE

AL WATANIYA INTERNATIONAL SCHOOL

SCHOOL

PRIMARY

CURRICULUM

LOCATION

BRITISH

NEW DOHA FERIJ SUDAN

WAHA FUTURE PRIVATE KINDERGARTEN

KINDERGARTEN

BRITISH

VISION INTERNATIONAL SCHOOL

SCHOOL

ALL GRADES

AMERICAN

AL WAKRA

AL ROWAD INTERNATIONAL SCHOOL

SCHOOL

PRIMARY

AMERICAN

AL AZIZIYYAH NORTH MUAITHER

AL ULMA INTERNATIONAL KINDERGARTEN

KINDERGARTEN

ADDED KINDERGARTEN

INDIAN

LOYOLA INTERNATIONAL SCHOOL

SCHOOL

KINDERGARTEN AND PRIMARY

INDIAN

AL NASR

RAJAGIRI PUBLIC SCHOOL

SCHOOL

KINDERGARTEN AND PRIMARY

INDIAN

AL MAMOURA

STAR INTERNATIONAL SCHOOL

SCHOOL

PREPARATORY

INDIAN

MESAIMEER

BARA'EM AL GHAD KINDERGARTEN

KINDERGARTEN

NATIONAL

MUAITHER

NEW LEVEL ADDED

KINDERGARTEN, PREPARATORY AND SECONDARY

NATIONAL

AIN KHALID

AL TAMAKKUN AL SHAMIL CO-SCHOOL

JASMINE KINDERGARTEN

KINDERGARTEN

NATIONAL

AL LAQTA

AL ATA W AL RI'AYA PRIVATE KINDERGARTEN

KINDERGARTEN

NATIONAL

MUAITHER

AL KHAZAMI SCHOOL FOR PEOPLE WITH SPECIAL NEEDS

SCHOOL

PRIMARY

NATIONAL

AL WAKRA

CREATIVE SCIENCE PRIVATE KINDERGARTEN

KINDERGARTEN

NATIONAL

MUAITHER

QATAR FINLAND INTERNATIONAL SCHOOL

SCHOOL

KINDERGARTEN AND PRIMARY

FINNISH

LABIB

Source: Peninsula Qatar, SEC

TFQ FELLOWS READY FOR ACTION

After a rigourous selection process and two months of intensive training, Teach For Qatar Fellows are now ready to be deployed in independent schools across the city at the start of the academic year.

he group of hand-picked young graduates and professionals begin their work as full-time teachers in Qatar’s independent schools and will benefit from T FQ’s ongoing leadership development programme in addition to teacher training that is customised to suit Qatar’s educational needs. During the summer, the Fellows worked closely with mentors who have extensive experience and who will be providing them with training and support throughout the two years. “I encouraged my daughter to join Teach for Qatar as a Fellow because I believe Qatar will benefit from a program such as T FQ,” commented the mother of Fellow Dana Al Marri, “I have seen her enjoy the Summer Institute and grow her skills as a teacher and also as a proactive member of the community.”

84 > QATAR TODAY > SEPTEMBER 2014

EDUCATION SPOTLIGHT

VOLUNTEER VACATION Nineteen students from Carnegie Mellon University in Qatar spent time volunteering in Nepal and Thailand this summer as part of the university’s global service learning programme.

artnering with Habitat for Humanity Nepal, CMU-Q students spent 10 days building a house in central Nepal for a struggling family. Mounir Sheikh, a sophomore at Carnegie Mellon Qatar, was one of the volunteers: “Participating in my first service learning trip exceeded my expectations. We had an amazing group of student leaders and acquired an entirely new skill-set that I would have never been able to learn elsewhere.”A second group of students travelled to Chiang Rai, the northernmost province of Thailand, where they spent two weeks working in rice fields, building foundations of leadership and innovation, and exploring the Thai culture.

FIRST FINNISH SCHOOL LAUNCHED The Qatar Finland International School, which was officially launched last month, joins a handful other schools in Qatar in providing an internationally accredited curriculum.

he QFI School is a primary school for girls and boys, starting with grades 0, 1 and 2 for children aged 5-7. The teachers responsible for the Finnish curriculum are from Finland, all holding Master’s Degrees in education, according to the school’s website. At the launch ceremony, Hamad Al Ghali Al Marri, Director of the Supreme Education Council’s Private Schools Office, stated: “The Supreme Education Council is glad to attend the launch of such an outstanding school. We expect QFI School will be a great added value to the educational system in the State of Qatar, as the Finnish education is considered one of the best in the world.”

86 > QATAR TODAY > SEPTEMBER 2014

EDUCATION SPOTLIGHT

UNIVERSITY OF CALGARY - QATAR

RESEARCH IN PRACTICE

The University of Calgary in Qatar (UCQ) has a mission: to educate world-class nursing professionals for Qatar’s growing healthcare system. One of the key focuses of nursing education at UCQ is research.

urses are no longer thought of as the ‘handmaidens’ of healthcare. Rather, today’s nurses are known to be highly educated women and men who dedicate their careers to the betterment of their communities. Skilled, adaptable, and motivated professionals, nurses are the heartbeat and backbone of healthcare. They are autonomous critical thinkers, collaborative team members and tireless patient advocates. Nurses promote wellness and are the pivotal point

88 > QATAR TODAY > SEPTEMBER 2014

and the connection between all aspects of healthcare. While nurses are proud to be the faces of healthcare and the key point of contact in patient care, they are equally dedicated to their roles as health researchers, advocates, educators, caregivers and promoters of wellness. The nursing profession can best be seen as a human science, with nurses acting as the bridge between the high-tech and clinical aspect of modern healthcare’s extremely complex environment and the compassionate humanity people need to experience in order to feel safe, well cared for, and capable of managing their own

wellness. UCQ is a fully accredited institution; its programmes combine the academic excellence offered at the University of Calgary in Canada with a commitment to the unique needs of Qatar, one of the most important of which is research. The State of Qatar is committed to supporting and promoting research in this country. The National Research Strategy (NRS) clearly outlines the goals and objectives of healthcare research in Qatar: “to improve health services, increase the prevalence of healthy behaviours in the population, and improve health outcomes; build

enabling platforms for medical and public health research that are able to provide an evidence base for public policy and medical practice in Qatar.” As the only international branch campus of one of Canada’s top research universities, UCQ is a proud supporter of the NRS and its vision. The primary purpose of nursing research is to inform practice. Rather than assuming, for example, the connection between airborne particles of dust and sand and occurrences of respiratory disease, UCQ researchers gather and analyze real data, and propose evidence-based conclusions leading to best-practice concepts for QATAR TODAY > SEPTEMBER 2014 > 89

EDUCATION SPOTLIGHT

treatment or management. UCQ faculty and students are currently engaged in more than 17 projects that are funded by the NRS and address significant topics identified in its strategic plan. These projects include research into inter-professional education and practice in healthcare, climatic influence on respiratory health in Qatar, breast cancer care, the relationship between cardio vascular disease and depression, diabetes care and prevention, and best practices for a healthy lifestyle in Qatar.

complex and demanding field of study, students can upgrade their science, math, and English skills through the Nursing Foundation Program at UCQ.

Facts on nursing education at UCQ UCQâ&#x20AC;&#x2122;s programs are accredited by the Canadian Association of Schools of Nursing. All programs are taught by internationally qualified Canadian nursing scholars, researchers and instructors.

Hands-on Learning UCQâ&#x20AC;&#x2122;s high-tech Clinical Simulation Centre (CSC) and Standardized Patient Program enable students to actively participate in their learning experience through classroom interaction with standardized patients, computer-generated human patient simulators, and virtual reality devices. In order to include the opportunity for supervised work with real patients in clinical situations, UCQ has initiated collaborative training partnerships with Hamad Medical Corporation, Qatar Red Crescent, Weill Cornell Medical College in Qatar, Qatar Diabetes Association, Sidra Medical and Research Centre, the Academic Health System, Qatar Supreme Council of Education, and Qatar Supreme Council of Health.

Bachelor of Nursing Degree The Bachelor of Nursing (BN) degree is the same degree awarded to graduates in the Faculty of Nursing at the University of Calgary in Canada, and is the gold standard of university degrees in nursing. A BN prepares students for work in patient care, community health, administration, research, health and wellness education, and for university graduate-level studies. Diploma in Nursing Students graduating from the Diploma Program begin direct patient care, and are able to apply to the post-diploma BN program.

Learn more: www.qatar.ucalgary.ca 90 > QATAR TODAY > SEPTEMBER 2014

Nursing Foundation Program Academic standards required to earn a BN are high and the focus of UCQ classroom instruction is both science-based and delivered in English. In order to ensure student success in this highly

Master of Nursing Program In recognition of the importance of research to advanced practice, UCQ offers a Master of Nursing (MN) graduate degree. The course- and thesis-based MN degree streams support the vision of the Qatar National Cancer Strategy, and are sponsored by Hamad Medical Corporation.

UCQ graduates Since 2010, UCQ has graduated 88 future nurse leaders. Another 48 are set to cross the stage in November 2014. UCQ graduates proudly contribute to the grand vision of healthcare in Qatar through their work in acute care, community health, education, hospital administration, research and healthcare advocacy

EDUCATION SPOTLIGHT

UNIVERSITY COLLEGE LONDON - QATAR

BRINGING CULTURAL HERITAGE TO THE FOREFRONT

UCL in London and Qatar Foundation partner up to offer postgraduate programmes and research projects that help share the countryâ&#x20AC;&#x2122;s history and culture beyond its borders.

CL is Londonâ&#x20AC;&#x2122;s academic powerhouse, a multi-disciplinary university consistently ranked in the top ten of global university league tables. Established in 1826 in order to open up higher education in the United Kingdom for the first time to students of any race, class or religion, UCL continues to direct its teaching and research into addressing real-world problems. Today students from over 140 countries study at UCL, sharing the common attributes of creativity and critical thinking. In partnership with the QF and Qatar

92 > QATAR TODAY > SEPTEMBER 2014

Museums, UCL was launched in Qatar in 2012 as a world-class research-led facility, focusing on the cultures and societies of the Middle East, and including the study of Islamic material culture and early technology. The first British university to open a campus in Qatar, UCL Qatar welcomed its first intake of students in August 2012. The portfolio of programmes offered at UCL Qatar is exclusively at postgraduate level. Since opening its doors, UCL Qatar has enrolled over 140 students from over 30 countries around the world, across its Master of Arts and Master of Science degree programmes:

EDUCATION SPOTLIGHT

Learn more: www.ucl.ac.uk/qatar 94 > QATAR TODAY > SEPTEMBER 2014

MA Archaeology of the Arab and Islamic World MA Museum and Gallery Practice MSc Conservation Studies MA Library and Information Studies In addition, UCL Qatar offers a postgraduate Diploma in Academic Research and Methods. The diploma has been tailored specifically to help students develop the essential skills required for intensive graduate level study on the Master’s degree programmes offered at UCL or elsewhere, including a focus on research methods, critical thinking and academic English. The diploma, along with the MA Library and Information Studies, have been innovatively developed in partnership with Hamad bin Khalifa University, and will eventually become a HBKU award and a joint-award, respectively. The emphasis on collaboration is a core aspect of UCL Qatar’s strategic vision. The students at UCL Qatar not only come from a wide range of cultural and geographic locations, but they also come from a range of different academic and professional backgrounds. The programmes are suitable for candidates with a background in archaeology, history, fine arts, chemistry, philosophy, anthropology, IT and many other disciplines. This diversity enhances classroom

conversation and fosters debate, as students bring differing perspectives on heritage matters into classroom discussion. Conducting world-leading, innovative research is at the core of the UCL mission, and UCL Qatar has successfully launched a number of research projects, with the support of its partners and the Qatar National Research Fund. The Origins of Doha Project is one such example. The first urban archaeological study of its kind in the Gulf, it aims at tracing the early settlements in Old Doha. It is hoped that the findings will be presented in the future Qatar National Museum. UCL Qatar has also commenced an important research project in the Meroe region of Sudan, investigating early iron production in the Kingdom of Kush. Positioning itself as the leading centre of excellence in the region for the study of cultural heritage, UCL Qatar equips students to be the future leaders in the heritage sectors of Qatar, the Gulf and beyond. Students take advantage of world-class facilities, including the most advanced conservation and materials science laboratories in the region. Mid-career heritage professionals can sign up for UCL Qatar’s short courses, and members of the public can get a taste of all things cultural heritage via the UCL Public Lecture Series

QATAR TODAY > SEPTEMBER 2014 > 95

development > tech talk

YOUR FRIENDLY NEIGHBOURHOOD ELECTRONICS COMPANY Although Qatar is riding the ‘nothing is impossible’ wave, we still did a double take when we heard about Royal Digital, a Qatarbased consumer electronics brand. Is this offshoot of the Al Mana Networks a turning point for the GCC, which hitherto has only been a voracious consumer of electronics and not much else?

BY AYSWARYA MURTHY

96 > QATAR TODAY > SEPTEMBER 2014

rima facie Royal Digital had all the makings of a prank. It had quietly popped out from nowhere with a pedigree and credentials that seemed too good to be true, its founder shrouded in mystery and close to non-existent online mentions. How is it possible that we hadn’t even heard a whisper about a company that has been working silently for over a year right in our own backyard and is now ready to take a plunge into the hyper-competitive consumer electronics market? And then

we met Rune Gunnar Dige and it all fell into place. Understated and occasionally channeling Steve Jobs (“I owe my tech life to him,” Dige tells us later on), he is aware of what a tough uphill battle it is going to be to make that initial breakthrough among consumers, especially those who have been fed a steady diet of Apple, Samsung, Sony and the like for so long. But with a firm belief (so much so that the company’s tagline derives from it) that history doesn’t

RD BLUETOOTH HEADPODS (BLACK/WHITE)

RD BLUETOOTH SPEAKERS

WIRELESS HEADPODS WITH

DUAL STEREO SPEAKERS

FOLDABLE SOFT TOUCH

WITH THE DOUBLEBLASTER’S

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COMES WITH 3.5MM AUDIO

COMES WITH MICRO AND

CABLE AND USB CHARGING

STANDARD USB CABLE AND

CABLE

3.5MM AUDIO CABLE

ENHANCED BASS

remember people who fear boundaries, Dige just wants to keep pushing them, rise above the naysayers by replicating the kind of aggression that Jobs was famous for, and have the “confidence and borderline arrogance to say we are the best and mean it”. But that’s not all that his arsenal consists of. Royal Digital’s coup de grâce surely lies in getting the expertise and global recognition of Foxconn behind their flagship products – their 60- and 70-inch smart televisions. Foxconn, for the uninitiated, is the manufacturing powerhouse behind premium names like Apple, Sony, Dell, HP, Microsoft and more. Today, they are churning out “thousands of units” for Royal Digital, which is bracing itself for its upcoming launch during Eid. “In the scale of who Foxconn deals with, this is a huge deal,” Dige says. “And since we couldn’t hope to match their clients in terms of sheer volume (for now), we had to sell them on our ambition, on where we were going to be in five years.” His personal ambition is pretty straightforward, he says. Tech for everybody. “There is a general perception about the electronics industry that very good must equal very expensive. We are here to break

that down.” He gestures to his personal gadgets - two iPhones and a Mac. “I love Apple’s feel and the design but I am not a big fan of their price. We know that we can make products just as good because we are employing the same manufacturers who are behind Apple and using very similar and high-quality components. So if we didn’t want a 150% profit margin or cash reserves larger than that of the United States government, we’d be able to retail it at a much lower price,” he says. Which is exactly what their plan is - to create a niche for themselves in the mid-range price category with high-end product quality. "The impossible made possible" Royal Digital will be entering the market with six products - the two smart TVs, Bluetooth headphones, Bluetooth speakers, a virtual keyboard and a drive recorder. Occupying an obscene amount of space in the conference room where it has been plugged in for a demo, the 60-inch TV (and its larger sibling) is clearly Dige’s pride and joy. “This TV has been in the making for a year – lots of man hours and hair loss,” he says, “It is probably the most tested TV in the world.” Because they are new and rely

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THE NEW TECH MANTRA ROYAL DIGITAL MAY BE FAR FROM SILICON VALLEY, BUT JUST LIKE ANY TECH COMPANY WORTH ITS SALT, IT WANTS TO MAKE THE WORLD A BETTER PLACE. SUSTAINABLE TECH IS THE OTHER SIDE OF THE RD COIN. “THE FUTURE LIES IN FACILITATING PRODUCTS THAT LESSEN THE ENVIRONMENTAL IMPACT AND ALSO TOUCH PEOPLE’S LIVES. SURE WE WANT TO MAKE MONEY BUT WE ALSO WANT TO MAKE A DIFFERENCE. OBVIOUSLY THE TVS WE MAKE WON’T IMPACT THE LIVES OF THE POOREST PEOPLE ON THE PLANET. BUT OUR OTHER PROJECTS WILL - WE ARE WORKING ON MAKING SOLAR LAMPS AND FANS WIDELY AVAILABLE TO THOSE LIVING IN PLACES WITH UNRELIABLE OR EXPENSIVE ELECTRICITY SUPPLY. WE WERE IN TALKS WITH SEVERAL WEST AFRICAN COMMUNITIES BEFORE THE EBOLA OUTBREAK AND WE ARE KEEN TO GET THIS PROJECT OFF THE GROUND AT THE EARLIEST,” HE SAYS. QATAR TODAY > SEPTEMBER 2014 > 97

development > tech talk

VIRTUAL KEYBOARD PROJECTS A FULL-SIZED LASER QWERTY KEYBOARD CONNECTS VIA BLUETOOTH TO iDEVICES, ANDROID DEVICES AND MOST LAPTOPS DETECTION RATE OF UP TO 400 CHARACTERS PER MINUTE RECHARGEABLE BATTERY LASTS FOR UP TO 200 MINUTES OF CONTINUOUS TYPING. USB CHARGING, NO DRIVERS TO INSTALL MOUSE MODE ALLOWS YOU TO USE YOUR FINGER AS A MOUSE, EFFECTIVELY CONVERTING THE KEYBOARD INTO A MOTIONPAD BUILT IN DISPLAY ALLOWS YOU TO VIEW THE LAST THREE KEYS TYPED

THE AL MANA CONNECTION “I KNEW I HAD TO COME TO QATAR BECAUSE TO ME, WATCHING FROM THE OUTSIDE, IT ALMOST FELT LIKE THE WILD WEST,” DIGE SAYS WHEN ASKED ABOUT HOW HIS PATH CROSSED WITH THAT OF SAUD AL MANA, CEO OF THE AL MANA CONGLOMERATE. “THE WORD ‘CAN’T’ AND DIDN’T SEEM TO EXIST HERE.” HE KNEW IN THIS LAND OF ANYTHING-IS-POSSIBLE, HE’D FIND TAKERS FOR HIS DREAM. AND HE DIDN’T HAVE TO SEARCH TOO FAR. “I FOUND MR SAUD AL MANA TO BE A MAN OF IMMENSE AMBITION AND VISION. HE WANTS TO DEVELOP THE TECH INDUSTRY IN QATAR SO IT WASN’T TOO DIFFICULT TO CONVINCE HIM ON ROYAL DIGITAL.” IF SAUD AL MANA IS THE ROCKET FUEL TO DIGE’S SHUTTLE, AL MANA NETWORKS GENERAL MANAGER MAHESH HAVAL IS THE ATC TOWER WHO BRINGS IT HOME. “WITHOUT MAHESH OVERSEEING THE DIRECTION OF THE COMPANY WE’D HAVE PROBABLY SPENT FAR TOO MUCH AND TAKEN LONGER TO GET TO MARKET. HE HAS THE COOL HEAD THAT IS SO IMPORTANT IN TECH. I FEEL VERY FORTUNATE TO BE SURROUNDED BY PEOPLE WHO WANT TO DRIVE THIS VENTURE FORWARD JUST AS PASSIONATELY I DO. WITH ALL THE INGREDIENTS FOR SUCCESS IN PLACE, THERE REALLY IS NOTHING STOPPING US,” HE SAYS. WHILE DIGE IS PROUD TO BE ASSOCIATED WITH AL MANA, HE DOESN’T WANT TO “CREATE AN UNNATURAL EXPECTATION OR DEMAND USING THE AL MANA NAME”. “AS MUCH AS POSSIBLE WE ARE TRYING NOT TO USE THOSE CHANNELS, BECAUSE IT’S NEITHER RIGHT NOR SUSTAINABLE. ULTIMATELY WHAT WE WANT TO BE KNOWN AND RECOGNISED FOR IS OUR PRODUCTS.” 98 > QATAR TODAY > SEPTEMBER 2014

so much on word of mouth, no compromise was made even on the smallest details, Dige says. “The risk is massive and every day of last year was spent on lessening that.” The box reads Smart TV but Dige says it’s more than that. “It’s effectively a massive Android tablet. With the remote control, air mouse and Qwerty keyboard all rolled into one, its functionality triples. And we have developed something even Apple doesn’t have currently - a built-in IPTV module. That technology was particularly difficult to get right back in Taiwan because of over heating problems,” he says. And the best news of all is the price. “We are retailing this 60-inch TV for QR5,500 right now. To buy a Sony or Apple TV of similar size and, more importantly, quality, you’ll have to shell out about QR3,000 more.” The same goes for the rest of Royal Digital’s products. “Our Bluetooth headset is just as good as, say, Beats’ and retails for less than half the price,” Dige says, pointing out that the compression rates for the headsets are identical. Their smartphone, when it is eventually launched, will tell a similar story. “My wish is that people will buy our products and go, ‘how did they do this?’ That they will nudge their friends and say, ‘guess how much I paid for it.’” However, his quest to effectively dampen the mystique surrounding ‘vanity brands’ is not an easy one, especially in this region. “Yes, there are many consumers in the region who buy the logo and not necessarily the product. But we are happy to accept that challenge,” he says. “Convincing buyers to spend on a brand they have never heard of before is hard. With a strong focus

on the online audience and a marketing strategy which reflects our brand philosophy - neat, innovative and contemporary - we are working overtime to get our name out there. It’s going to take time because people don’t always want to try something new. But once it gets rolling, there’ll be a snowball effect. In five years, we except to be the biggest TV sellers in the Middle East.” He pauses for a moment and then adds, “Maybe six.” Proudly from Qatar, with a global reach Currently, design and testing are being divided among the Foxconn plant in Taiwan, Qatar, Germany and the United Kingdom, based on capabilities and logistics. “The TV design is significantly outsourced to Foxconn. It would be stupid not to use the expertise of the No 1 TV manufacturer in the world. The testing is primarily done in our brain centre in Germany, which also shares design inputs and guidance. This helps us bring more diverse ideas to the table and work together to maximise our expertise,” Dige says. Their rollout strategy is also very much global. “Starting with Qatar, we are going to expand to Saudi Arabia and the UAE. We are also in talks with a couple of retailers in India, working out the logistics and tax issues. We want to hit India in January next year, Europe later in the year and hopefully, America in time,” he says. He wants to pace himself and not stretch the company too thin. “Already we find ourselves being unable to meet the demand from online sales. It’s an excellent problem to have though,” he smiles

technology > viewpoint

WILL TECHNOLOGY KILL THE INSURANCE BUSINESS?

Most insurance companies are still in a wait-and-watch mode when it comes to the use of innovative technologies; a few leading companies, however, are researching the implications of new technical developments on their business. BELOW ARE THREE SCENARIOS IN WHICH TECHNOLOGY WILL IMPACT THE INSURANCE INDUSTRY IN A BIG WAY IN THE NEAR FUTURE.

BY KAPIL BHATIA

SCENARIO 2 HOME INSURANCE Let’s take the scenario of Smart Homes. According to a presentation by Qualcomm at this year’s Mobile World Congress on the home of the future, the front door will ‘talk’ to your smoke alarm, lights will flash when the fridge door is left open, and a teddy will put your child to bed. The presentation shows that almost anything in your house can either be controlled by a mobile or linked together electronically. If things are going to be so smart, do I need to have home insurance? Rather, insurance companies may have to rethink their business model on home insurance.

INSURANCE COMPANIES COULD USE MONITORING DEVICES TO TRACK WHETHER OR NOT A HOMEOWNER LOCKS EXTERNAL DOORS AND DRIVE UNDERWRITING SINCE A LOCKED DOOR REDUCES BURGLARY RISKS.

SCENARIO 1 AUTO INSURANCE While I was away on a great vacation, my insurance agent made a point to e-mail me about renewing my car insurance as it was going to expire that month. I had two options: either to renew the existing insurance policy or continue researching for an alternative. Being in holiday mood I just couldn’t have been bothered to do the research, and after a week I e-mailed my agent to go ahead and renew the insurance policy. Just imagine in the future when Google’s driverless cars go commercial, producing millions of them on the streets. If these cars are auto-controlled without any human intervention, what are the chances of an accident? What happens to the auto insurance business? While the feasibility of Google’s driverless car has been questioned by many experts, you never know what the future looks like. Even if such a car doesn’t go commercial, the auto insurance business model has to change. Telematics and usage-based insurance (UBI) are among the hottest topics in auto insurance. Insurance companies have been working on two different auto insurance models:

PAY AS YOU DRIVE (PAYD) TYPICALLY CHARGES A CUSTOMER BASED ON ACTUAL, DOCUMENTED MILES DRIVEN. PAY HOW YOU DRIVE (PHYD) GENERALLY BASES PRICING ON A VARIETY OF DIMENSIONS RELATED TO THE DRIVING BEHAVIOUR OF THE CUSTOMER, SUCH AS RAPID ACCELERATIONS AND DECELERATIONS, THE TIME OF DAY, THE ROUTES DRIVEN AND THE TERRITORIES DRIVEN THROUGH.

SCENARIO 3 HEALTH INSURANCE This week I attended a presentation at NAB Village in Melbourne that discussed a number of biotechnologies that will be available at nanoscale within a decade, providing the ability to embed devices and sensors unobtrusively within the human body. According to reportlinked.com, the nanotechnology drug delivery market is expected to grow at a CAGR of 21.7% between 2009 and 2014, and reach almost $16 billion by 2014. Such nanotechnologies can dramatically improve body health and control chronic disease. This means we will be pre-empted before a disease can paralyse our bodies. Therefore, why would you buy health insurance? Insurance companies need to think harder on their propositions. Should they still continue to offer generic health insurance or do they need to customise their offering?

TECHNOLOGY IS GETTING SMART; INSURANCE COMPANIES HAVE TO GET SMARTER!

development > tech talk

RETRO-FIT YOUR TYPING

GRAB YOUR GOOGLE GLASS

Tom Hanks dived into the app market with an app that recreates the feel and sound of an old-school typewriter on your iPad.

AVAILABLE AT iSPOT OUTLETS IN THE CITY FOR

QR9,999.

IF YOU MISS THE CLICKETY-CLACK OF THE OLD MANUAL TYPEWRITER, TOM HANKS HAS THE PERFECT SOLUTION FOR YOU. HANX WRITER, THE APP HE COMMISSIONED WHICH QUICKLY REACHED THE NO.1 POSITION ON THE APPLE STORE, WILL LET YOU EXPERIENCE HOW TYPING WAS DONE 50 YEARS AGO BUT WITH THE SPEED AND EASE OF YOUR IPAD. “WITH HANX WRITER, YOU’LL HEAR THE RHYTHM OF YOUR WORK WITH SHOOK-SHOOK OR FITT-FITT,” HANKS SAYS IN THE DESCRIPTION. YOU CAN EVEN CHOOSE TO DO AWAY WITH THE DELETE BUTTON AND INSTEAD RECTIFY MISTAKES WITH A 'XXXXX'. THE APP IS FREE TO DOWNLOAD AND YOU CAN PURCHASE TWO DIFFERENT SKINS IN-APP.

FOR WORK AND PLAY

Microsoft Devices launches the Lumia 930 in Qatar.

SECURITY ON WHEELS

“T

The Ministry of Interior launched Qatar’s first hightech airport service vehicle at the departure area of the new Hamad International Airport.

he vehicle, the first of its kind in Qatar, is expected to intensify security measures at the airport,” Airport Immigration Department director Lt Col Mohamed Rashid al-Mazrouei told a local English daily. Reportedly, the standard golfcar-sized, solar-powered vehicle is equipped with a portable fingerprint and document scanner and is connected to the data base of government agencies in Qatar and international security organisations like Interpol, in addition to video cameras providing 360-degree views. The vehicle will also be used to transport passengers in need across the mammoth airport, like those running late for their flights.

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ith Windows Phone 8.1, Lumia 930 packs a rich suite of applications and services into a beautifully crafted design with metallic details and vibrant new colours, while keeping content like photos, videos and documents in sync across Windows Phone, PC, tablet and Xbox devices. “With beautifully integrated Microsoft and Lumia experiences, the Lumia 930 is a leading smartphone that will allow people to capture full HD video with astonishing details like never before,” said Jehad Al Qudah, Head of Mobility BU, CGC. Some of its features include a 5-inch Full HD OLED display, 2420 mAh battery and built-in wireless charging, 20MP PureView camera with optical image stabilisation and high-quality ZEISS optics, four high-performance microphones and Rich Recording, low-power motion sensing, new Microsoft Enterprise feature pack, OneDrive, HERE Maps and more. The Lumia 930 is now available in Qatar at a retail price of QR2269, in a range of colours including bright orange, bright green, black and white.

UNDERWATER PICS MADE EASY THE NEW XPERIA M2 AQUA FROM SONY FEATURES THE “HIGHEST LEVEL OF WATERPROOFING IN THE WORLD OF SMARTPHONES” AND IS AVAILABLE IN QATAR FOR QR1288; NOW ANYBODY WILL BE ABLE TO TRY THEIR HAND AT TAKING PICTURES IN THE SWIMMING POOL.

I SHALT NOT BE IGNORED

Developed by a frustrated parent, Ignore No More is an Android app designed to ensure your kids never ignore your calls ever.

CHAD HURLEY TO SPEAK IN DOHA

atar Science & Technology Park has announced YouTube co-founder Chad Hurley is to take part as a guest speaker at the opening ceremony of this year’s International Association of Science Parks and Areas of Innovation’s (IASP) 31st Annual World Conference, the first one to be hosted in the Arab world, from October 19 to 22 in Doha. “Chad Hurley is one of the most visionary and influential technology entrepreneurs in the last 20 years and to have him join, speak and contribute to the success of IASP 2014 Doha is a real privilege to our event and to the region,” Hamad Al Kuwari, Head of the IASP 2014 Doha Organising Committee and QSTP Managing Director said. Hurley helped develop PayPal’s user interface for eBay before co-founding YouTube in 2005. Google later bought the service for $1.76 billion.

PARENTS CAN NOW LOCK THEIR CHILD’S SMARTPHONE WITH A PASSWORD WHICH ENSURES THAT THE PHONE’S OTHER FUNCTIONS AND APPLICATIONS CAN’T BE USED UNTIL THEY CALL THEIR PARENTS BACK. “WHEN YOU LOCK YOUR CHILD’S PHONE WITH IGNORE NO MORE YOUR CHILD HAS ONLY TWO OPTIONS - HE OR SHE CAN CALL YOU BACK, OR CALL FOR AN EMERGENCY RESPONDER,” THE APP’S WEBSITE SAYS.

CLAMPING DOWN ON ADVERTISING TERRORISM

The gruesome video of the beheading of journalist James Foley highlighted how extremists are effectively using the social media to terrorise, incite and spread their message of hate.

any months since his disappearance in Syria, James Foley resurfaced again on the internet. While the video of his brutal beheading and his murderer’s calm challenge to Obama was being obsessively shared on social media, another trend was emerging. Following the wild popularity of the hashtag #ISISmediablackout, which called for not sharing any kind of violent videos and images created for propaganda and feeding into their morbid quest for publicity, Twitter decided to suspend the accounts of those tweeting images or videos of the horrific incident. This also renewed the debate on how social media are empowering terrorists. QATAR TODAY > SEPTEMBER 2014 > 101

business > auto news BMW LAUNCHES NEW VEHICLES IN QATAR Alfardan Automobiles, the official BMW Group importer in Qatar, has announced the launch of the all-new BMW X4 Sports Activity Coupé and new BMW X3. The new BMW X4 combines impressive sports car performance and Sports Activity Vehicle versatility with the elegance of a coupé.

ommenting on the arrival of the vehicles, Mohammad Kandeel, Chief Operating Officer, Alfardan Group Automotive Division said: “The BMW X4 is a welcome addition to our X family here in Qatar. Blending performance and utility in a muscular skin, the BMW X4 will be BMW’s second offering in the Sports Activity Coupé segment. Similarly, 10 years on, the new BMW X3 continues to build on its best-in-class versatility and robust agility. We are confident that both vehicles will resonate well with our clientele in Qatar

NISSAN PATROL SHATTERS SALES RECORD The famed Nissan Patrol shattered sales records galore throughout the Middle East this July, hitting a record monthly high of 3,581 units, a substantial hike of 103% on the same month in 2013. Nissan Patrol is a name synonymous with ruggedness; a legendary off-roader capable of going anywhere, anytime. With a rich heritage spanning over 60 years, the Patrol is Nissan’s flagship SUV model and enjoys a passionate following across the Middle East. In the UAE a record 1,506 Patrols left the showroom floors, while Oman (702 units) and Qatar (316 units) also notched all-time highs. Kuwait (347 units), Bahrain (95 units) and KSA (316 units) added to the impressive record tally in the GCC countries. 102 > QATAR TODAY > SEPTEMBER 2014

who consistently demand the best in premium motoring.” From the front, the car is immediately recognisable as a member of the BMW X family: The large air intakes positioned on the outer edges of the front end and the precise character lines in the front apron give the X4 a muscular and agile appearance. And the car’s wide track, visually low centre of gravity, long wheelbase and pronounced wheel arches emphasise its good road handling. The stand-alone design of the BMW X4 is further reinforced by the

Alfardan Automobiles BMW sales team celebrating the arrival of the all-new BMW X4 Sports Activity Coupé and BMW X3.

fresh interpretation of the signature swage line running along the sides. The BMW X4 will be available with two powerful engines, both with BMW TwinPower Turbo technology. Topping the range is the BMW X4 xDrive35i with a 3.0-litre straightsix petrol engine delivering a maximum output of 225 kW/306 hp and propelling the vehicle from 0 to 100 km/h in just 5.5 seconds. In addition, the xDrive28i has a 2.0-litre four-cylinder engine delivering 180 kW/245 hp and goes from 0-100 km/h in 6.4 seconds.

HYUNDAI TO HIT MIDDLE EAST MARKETS THIS SEPTEMBER

Hyundai Motor Company has announced that the all-new Sonata mid-size sedan will hit Middle East markets in September.

taying true to Hyundai’s acclaimed ‘Modern Premium’ brand direction, the all-new Sonata will offer modern styling, excellent performance and practical application of the latest Hyundai technologies. This improved 7th generation model is the result of three years of research and development conducted by Hyundai in the Middle East and around the globe, in order to maximise product competitiveness and satisfy the diverse needs of the Middle East market. The Sonata has traditionally been one of Hyundai’s best-selling models across the Middle East, with more than 27,000 units sold across the region in 2013. Since its introduction in 1985, cumulative global sales have reached almost seven million units. The all-new Hyundai Sonata will initially be offered with a choice of two different engines; a 2.0 L multi-port injection (MPI) and a 2.4 L MPI, with a 6-speed automatic gearbox available

ROLLS ROYCE

DOHA ANNOUNCES SALES INCREASE

Rolls-Royce Motor Cars Doha, the authorised dealer of Rolls-Royce Motor Cars in Qatar, announced a 39% sales increase for the first half of 2014 compared with 2013. The Qatari dealership’s growth continues to surge, following a 17% growth in the first quarter of the year.

ohamed Kandeel, Chief Operating Officer, Alfardan Group - Automotive Division, said: “Following a remarkable first quarter in 2014, Rolls-Royce Motor Cars Doha continues to go from strength to strength as illustrated by what has been an outstanding first half of this year. We offer vehicles that are as refined and distinguished as our clients, and a level of service that is unparalleled – two factors

that have, and will continue to, strengthen sales.” In line with Rolls-Royce Motor Cars Doha’s first quarter growth, a key driver of this steady sales performance continues to be the Rolls-Royce Wraith. The most powerful and dynamic Rolls-Royce in history, the Wraith has retained its position as one of the most popular Rolls-Royce models among Qatari buyers.

NISSAN ANNOUNCES GLOBAL FOOTBALL PARTNERSHIP Nissan Motor Company and City Football Group (CFG) recently unveiled a global partnership which will see the Japanese car manufacturer become CFG's official automotive partner. The five-year deal represents a first for CFG, with Nissan becoming the first global partner of the football network, an organisation including Nissan majority-owned Yokohama F. Marinos alongside Barclays Premier League Champions, Manchester City FC, Manchester City Women’s FC, New York City FC, and Melbourne City FC. City Football Group also owns football and marketing companies operating from a number of offices around the world. The Nissan CFG partnership will see Nissan become the Official Automotive Sponsor of Manchester City Football Club and enjoy a strong brand presence at the Club’s famous Etihad Stadium, complemented by fan engagement opportunities targeting City supporters all over the world. The collaboration follows the previous agreement between the two organisations, announced earlier this year, which saw CFG assume a minority stake in the Nissanowned Yokohama F. Marinos and commit to provide its knowledge, expertise and services to the J-League club through the City Football Services and City Football Marketing companies.

for customers in the region. Tom Lee, Vice President and Head of Hyundai Africa and Middle East Regional Headquarters, states, “Our aim was to create a world-class mid-size sedan through innovation while maintaining the model’s heritage, and we are confident that the all-new Sonata will prove extremely popular with our customers throughout the region once it has gone on sale in September.”

“Nissan has always been immensely proud of its place in Yokohama F. Marinos history and is now privileged to be part of the story of CFG and their network of fantastic global football teams,” said Carlos Ghosn, Nissan President and CEO. “This innovative partnership enhances Nissan’s investment in the game of soccer which is a key platform to further strengthen our brand globally,” he added.

QATAR TODAY > SEPTEMBER 2014 > 103

business>marketwatch TABLET FOR YOUNG MINDS

SPLASH INTRODUCES BRAND AMBASSADORS NICOLE SABA AND SALMAN KHAN Hot off the heels of turning 21, Splash, the home-grown high-street retailer, has announced the popular Arab singer and actor Nicole Saba as its brand ambassador along with Bollywood heartthrob Salman Khan.

first for Splash in terms of bringing together two acclaimed celebrities from varied backgrounds, the strategic announcement comes at a time when the brand is celebrating ‘In Love with Fashion’. The celebrities will together be seen promoting the entire line-up of Splash clothing and accessories across various platforms of the brand and will be interacting with the wide audience that Splash caters to. Speaking on the association Salman Khan said, “My association with Splash has only strengthened over the past year as it is an amazing brand and I look forward to another successful season.” “Splash is an extremely well known high-

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street retailer in the region and I am thrilled to be the new face of the brand. We recently shot in India for the AW’14 campaign along with Salman Khan and I am very excited to see what this new association and journey has in store for me,” said Nicole Saba. Raza Beig, CEO of Splash and Iconic, said, “We are very excited to have Nicole Saba and Salman Khan, two of the biggest stars, as the face of Splash in the region. Our success with Salman as a brand ambassador prompted us to look for a woman who embodied panache in its true essence and is a style inspiration.” He adds, “We have also signed Bollywood actress Esha Gupta as the face for Splash in India.”

Like it or not, children these days feel right at home with our touchscreen devices. The obvious downside is that your little one may end up altering your settings or accidentally sending something to a friend or colleague without your permission.

here is also the chance that tap-happy kids may be exposed to inappropriate material. With these issues in mind, the Samsung Galaxy Tab S is designed to be fun and safe for both young and adult users. While many third-party parental control apps exist, Kids’ Mode is exclusive to Samsung and seamlessly moves your device into a child-friendly environment. Pre-loaded to your Galaxy Tab S device, Kids’ Mode includes five specially designed apps - camera, karaoke, drawing, picture gallery, and video playback - which adapt the tablet’s existing functions into entertaining and intuitive features for kids. Best of all, Kids’ Mode is controlled by a pin code, preventing children from wandering outside the dedicated app suite. For a bit of extra protection, it is also easy to implement additional parental control settings, such as a daily playtime limit, or to regulate media accessibility. Besides a host of features, the Samsung Kids Store now contains over 900 apps specially designed with children in mind. One of its most useful features is an age-range filter that allows you to select apps that will continue to entertain and challenge your children as they grow. The content is also classified by function - learning, play, or story - so that you can stealthily incorporate education into your child’s playtime.

SHOP FOR SCHOOL AND WIN A HOLIDAY Shopping for school supplies, could actually win you a holiday. City Lifestyle recently announced its biggest promotion to date. The brand is offering customers a chance to sail on a Mediterranean Cruise for a family of four. All one has to do is make a purchase worth QR200. School supplies range from a number of choices including designer backpacks, lunch bags, stationery pouches and more. The items are available for young girls and boys. Teens can choose from an array of backpacks stitched in long-lasting materials. Boys have a choice of NBA merchandise, or Ferrari designs and other racing champions. Older teens have something to choose from with exclusive collections from brands like Pepe Jeans, I Love NY, Bronxx and Beverly Hills Polo Club, to name a few. The cruise offer begins on August 15 and ends on September 6 this year.

WOODY NOTES FROM

PACO RABANNE

he new perfume by Paco Rabanne is a limited edition for ladies and gents. Known simply as Black XS it casts a passionate spell over those within its radius. The male fragrance has a woody aroma with a spicy touch of Juniper berries. The perfume for women is also a mix of woody and amber notes. QATAR TODAY > SEPTEMBER 2014 > 105

business > marketwatch

SHOE MART

OFFERS WIDE SCHOOL CHOICES Shoe Mart is offering a wide variety of school shoes, bags and other important items for little learners to ensure their ‘must-haves’ for the next school term. The company offers a wide range for kids this season with a ‘Back to School’ campaign that kick-started from July this year. To begin the new school year girls can choose from an elegant range of shiny leather bowed and flowered pumps and ballerinas, from brands like Start Rite and Juniors, while boys can choose from a number of comfortable casual styles from the Kangaroos, Barefeet and Start Rite collection. A wide assortment of school shoes for girls from classic Mary Jane’s to black ballet pumps and black school shoes for boys will be available in store as well.

The Back to School range offers a selection of school bags, an exciting range of backpacks, as well as pencil cases, lunch boxes and water bottles. From practical and simple, to trendy and fun school bags, children are sure to find what their hearts desire. Shoe Mart COO, Mohamed Iqbal Yacoob Ali said, “Shoe Mart’s ‘Back to School’ campaign has proven to be a success with our customers year after year. Every year we strive to make it special to reach out to all and at the same time create a point of difference with our offering.”

CLASSIC BLUE FROM BECKHAM

One year after the launch of his celebrated Classic fragrance, David Beckham introduces Classic Blue, his charismatic, bold new scent for men. Evoking David’s effortless style, Classic Blue brings a sharp, vivacious twist to the original fragrance.

he fragrance opens with a fruity burst of invigorating grapefruit and juicy pineapple fused with fresh violet leaves. The heart reveals an aromatic blend of crisp sage and iconic geranium, tamed by a tart green apple accord. Beckham states, “I like to mix classic and contemporary fashion and this inspired the creation of my new fragrance for men, Classic Blue. It has a timeless aroma with a relaxed, modern feel. It’s a bright, bold, masculine fragrance with fresh citrus and woody notes, for men who want to make a confident style statement.”

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culture>qt take CINEMA IN STYLE

BY ABIGAIL MATHIAS

Cinemagoers in Qatar have been taken to the next level of entertainment. No, we aren’t talking about an intergalactic sci-fi flick (though that too wouldn’t be so bad). If you are searching for cinema viewing in style, head to Novo cinemas. Located at the Pearl Qatar, the swanky new movie complex offers viewers a chance to catch the latest flicks in comfort and luxury.

f course luxury doesn’t come cheap. Tickets for the seven-star shows are a crisp QR150 per person. Plush leather reclining seats and convenient side tables for snacks are some of the features that your seven-star tickets bring. Novo has also thoughtfully left blankets and pillows for those who choose the seven-star treatment. Valet parking is also on hand, as is a fully loaded iPad enabling customers to order snacks from the convenience of their seats. If you are not in the mood to splurge, there are plenty of cinemas within the complex to choose from. Novo Cool and Novo Edge offer a variety of seating positions

within the theatre, from standard seats to superior back-row seats. Novo 3D as its name suggests, brings exciting 3D visuals to the viewer’s world, while Novo Imax represents the world’s leading immersive cinema experience. The cinema complex in Qatar was opened to the public during the recent Eid festivities. The facility boasts 1,456 seats and more than 10 state-of-the-art screens. It is the Middle East’s largest chain of cinemas and a subsidiary of Qatar Media Services. Though it is still in the early stages, the management is pleased with the turn out. “It’s been a very exciting few weeks since our launch. Cinemagoers have been

very vocal about their appreciation of a new standard in the cinema experience; we’re thrilled with the response,” says a spokesperson from Novo Cinemas. People are cautious about how they spend their money. Novo has thought of innovative ways to draw customers to the cinema. They’ve introduced a unique experience before, during and after a movie, whether it’s with in-lobby entertainment or providing fun activities on large interactive screens. One can also find concession offers that appeal to film fans looking for collectible merchandise, or a family trip to the movies. For a unique treat, try the personalised service in the seven-star cinema. Its premium menu is served on chinaware. Now that’s worth bragging about QATAR TODAY > SEPTEMBER 2014 > 107

culture > doha diary

THE URBAN WARRIOR

BIZZ AWARDS TO BE HELD THIS SEPTEMBER

The Bizz is recognised as one of the most valued business awards in the world, given out to leading businesspeople from each sector who stand out for their business excellence. These are individuals who foster the growth of the economy in their respective countries and throughout the world on a daily basis. This year, awards will be given out at three ceremonies: Bizz Europe (Venice), Bizz Americas (Hawaii), and Bizz Arabic. The last ceremony will be held on September 28 at the Emirates Palace Hotel, located in the heart of Abu Dhabi. The event will be dedicated primarily to recognising companies of the Gulf Cooperation Council, as well as other businesses from the rest of the world. The awards are handed out by the World Confederation of Business (WORLDCOB), a leading international organisation established more than 10 years ago and based out of Houston, Texas. WORLDCOB seeks to promote the generation of new business opportunities, social responsibility, and business excellence among its members. This is the fourth time WORLDCOB has organised this ceremony in the Middle East. It was held in Qatar in 2012. Past award recipients include Fortune 500 companies such as Oman Arab Bank, Saudi Telecom Company, Abu Dhabi University, Qatar Airways, National Bank of Bahrain, Fastelco, Al Sulaimi Group, and Doha Bank among other major businesses. Registration is still open for small, medium, and large companies that have attained a high level of business excellence. NOMINATIONS ARE ACCEPTED AT www.thebizz2014.com.

QATAR TAKES ON THE ICE BUCKET CHALLENGE

Who knew that close to a hundred enthusiastic people would wake up on a Friday morning at 8 a.m. to douse themselves with a bucket of ice cold water?

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Aspire Zone is set to host its first adventure racing obstacle challenge on October 18. The ten exciting legs of the race include scaling the heights of the Olympic high diving board, summiting Aspire’s climbing wall, kayaking around the lake etc, all to win the accolade of becoming an ‘Aspire Logistics Urban Adventurer’. Registration is ongoing for the competition which is open to men and women aged 18 and above. The challenges will be performed in teams of four and awards will be given to the top overall finishers.

hat’s exactly what happened at the St. Regis Hotel on 22 August. Enthusiasts were asked to bring their own bucket and towel. The challenge was held on the beach and donations were pledged into ALS, a neurological disorder medically known as Amyotrophic Lateral Sclerosis. It is also known as Lou Gehrig’s Disease. On 23 August, Wyndham Grand Regency also took the challenge with its employees, staff and guests participating in the task at hand. The ice bucket challenge has flooded the internet with videos and images of individuals agreeing to douse themselves in a bucket of ice cold water. Celebrities like Justin Timberlake, Jennifer Lopez and 2014Wimbeldon winner Novak Djokovic have posted hilarious videos of themselves taking up the task and spreading the word.

DFI HOSTS QATAR JURORS AT ITALIAN FILM FESTIVAL

Doha Film Institute has underlined its commitment to encouraging cultural exchange through film at the Giffoni Film Festival, the largest children’s film festival in Europe, held in Italy.

C '100 THOUGHTS' EXHIBITION ON AT VCUQ

elebrating the partnership between Doha Film Institute and Giffoni, six jurors from the inaugural Ajyal Youth Film Festival were chosen to join the international youth jury of the Giffoni Film Festival. They deliberated on the winners of the 44th edition of the film festival which took place from July 18 – 27. The six jury members from Qatar included Deema Al Hail, Naji Al Ali, and Ayah Al Ansari, in the 13+ category; and Abdulaziz Al Haddad, Sana Al Ansari, and AbdulKareem Anisetty, in the 16+ section. The jurors from Qatar joined over 3,500 young people from countries including

Italy, Brazil, Croatia, Russia and South Africa. This is the third year that Doha Film Institute has facilitated the attendance of young talents from Qatar at Giffoni. As part of its presence at Giffoni Film Festival, Doha Film Institute hosted an Iftar for delegates of the Festival, where visitors were provided with insights into local Qatari culture. A showcase of works by Qatar-based filmmakers was also presented, featuring a special programme of short films titled ‘Made in Qatar’. The second edition of the Ajyal Film Festival will take place from December 1 – 6 at Katara Cultural Village.

Tim Makower has been creating sketchbooks, as an extension of himself, throughout his time in Doha. These small books reflect his fleeting thoughts, ideas and moments in a very direct and personal way. Each one holds starting points to different moments that he himself has explored, but by exhibiting them in the gallery context, Makower also invites the viewer to share his journeys, as well as construct their own personal narratives or ‘100 Thoughts’ in Doha. An exhibition of Makower’s work entitled "100 Thoughts: Chapter 1" is on at VCUQ gallery from September 15 to October 16. Entry is free.

ARTIST CAPTURES DOHA’S CHANGING LANDSCAPE

When a design artist came to Doha more than 20 years ago, he saw vast open spaces with few buildings. The beauty of the natural landscape propelled him to pick up a paintbrush and capture what he saw. This man is Ananda Nanayakkara. An artist from Sri Lanka, he was fascinated by the sea in Qatar, which became a predominant feature in his paintings. An exhibition of his work titled ‘Summer Art Festival – sceneries of Doha’ was recently unveiled at Mercure Grand Hotel Doha. Through his work the artist portrays the transformation of Qatar to a modern city. QATAR TODAY > SEPTEMBER 2014 > 109

Qatar Today looks at two expatriates from everyday life, one who has lived here for a significant amount of time and another who has just made Doha his home, for their take on life in this city.

MY HOME IN QATAR JUNITA VAVE Project Manager (Events & Fashion), Trinity Talent Qatar Been in Doha since: January 2005 (nine years with a break in between) When I initially moved here to be with my husband, who had just started flying for Qatar Airways, there were only seven towers in the Business Bay area. The first restaurant I went to when I arrived was the old Al Bandar restaurant on the Corniche by the dhow area. I really miss that place; I remember how beautiful it was, just sitting right beside the water having amazing fresh seafood and smoking sheesha. I have so many great memories of Doha, the first being part of the Doha Asian Games in 2006. Our first job was booking hostesses for QNB’s hospitality VIP Lounge which we managed to pull off despite having hardly any hostesses. Another unforgettable experience was when we tried to scout for models in the malls (the only ones back then were City Centre, Landmark and The Mall) when not many

even knew what a ‘model’ did. It was so much fun too. My life has changed in so many ways for the better since I moved here. I was living in the UK for a long time and didn’t really enjoy being in the cold and rain every day as I am a Pacific Islander by origin and always craved to be in the sun. I worked as a fashion stylist and personal shopper before but I wanted something more. I love what I do here with Trinity Talent Qatar, where my clients vary from the United Nations to fashion designers like Louis Vuitton, and every day is different. Qatar is growing like crazy and I feel that my move brought me to the right place at the right time. I wouldn’t change it for the world.

NEW BEGINNINGS

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JOSEPH DANCEY Senior Account Director BLJ Worldwide Been in Doha since: December 2013 (eight months) I’m originally from North East England but lived in London since university. Having started my career working in politics for British government ministers, I took a summer out travelling overland (as much as possible) from Syria down to Oman. After that experience, I wanted to work in the Middle East. However, I then spent five years as advisor and speechwriter to Sebastian Coe in his role as Chairman of the London 2012 Olympics which kept me firmly rooted in the UK instead. Even now, I miss the atmosphere in the Olympic Stadium and Velodrome where I spent so much time working in the summer of 2012. Such big events are unique, inspirational periods. Post-Games it felt like the right time to start a new challenge which ultimately 110 > QATAR TODAY > SEPTEMBER 2014

led me to Qatar; more big games and a great time to make new, international friends. There are big changes since my first visit in 2007 but the most successful are those that offer new facilities whilst retaining their local culture and influences. I moved out of West Bay to see a different side to the city than the usual expat experience. I’d like to learn how to cook Middle Eastern food better and am keen to travel more across Qatar and the region. The Museum of Islamic Art and its park are my favourite places to read a book at weekends. I’m sure that Msheireb and the new national library and museum will become equally popular destinations in time too.