Today’s Qatar is not a state designed by mandate powers. Rather, the ruling family of the Al Thanis can look back on a long history. With the first oil discoveries, Qatar gained global importance.
Doha – The largely hostile desert of the peninsula, which makes up the territory of the state of Qatar, is home to a flourishing economy thanks to oil. The emirate is wealthy enough to be a major global player in various areas such as sport, culture and business, and is proving to be a skilful investor on the international stage.
Qatar: long history and economic boom
The peninsula, which, together with a few neighboring islands, represents today’s emirate of Qatar, has been settled since the Stone Age. The gradual advance of the desert made the land area of the small state uninhabitable over the centuries. It was not until the 18th century that Bedouins immigrated from what is now Saudi Arabia to the barren pastures, including the family of today’s princes of Qatar. Around this time a first settlement was built, which would later become today’s Doha.
For decades, Qatar, under the leadership of the Al Thani family, was in conflict with both the devout so-called Wahhabis from the interior of the Arabian Peninsula and with the rulers of the nearby island state of Bahrain. The ongoing conflicts, but also the piracy along the Arab east coast finally led to the interference of Great Britain in 1867 and to the conclusion of a protection treaty with Qatar. The long-term close relationship still shapes some aspects of life today, such as the education system, which is structured according to the British model.
With the oil to prosperity and independence
It was not until 1939 that oil deposits were discovered in Qatar – a gateway to future prosperity for the small peninsula. As in the United Arab Emirates, the sheikhs of the Al Thani family used the income from oil production to promote the country’s economic and social development. However, the country did not become fully independent for the time being – Great Britain maintained its troop presence in the region until the beginning of the 1970s. Qatar did not gain independence until September 3, 1971, but did not join the neighboring United Arab Emirates. The state’s prosperity grew again in the same year when the largest natural gas field in the world was discovered on the state territory. In an international comparison, Qatar, with its small population, has one of the most powerful economies to this day.
Qatar: geography and demography of the state
The Qatar peninsula borders Saudi Arabia in the south. Salt marshes form a natural border along this land connection. The interior of the country is characterized by hilly, sandy and rocky desert, in which only very little undemanding vegetation and desert animals and heat-resistant insects that are adapted to the climate can exist. The climate is slightly more humid along the north coast of Qatar, but overall the geography is extremely inhospitable.
There are no rivers or even larger oases, two artificially created lagoons in the hinterland of the capital Doha on the east coast and inland near al-Kirana serve as resting places for migratory birds and native bird species, but do not have full water levels all year round. The emirate obtains drinking water mainly through the desalination of sea water.
Demographic leap due to foreign workers
The few Bedouin tribes that grazed their animals in the deserts of Qatar for centuries, including the Al Thani, only made up a very thin, predominantly nomadic population. Today Qatar is one of the countries with the fastest growing population. At the beginning of the 1950s, the emirate had fewer than 50,000 inhabitants; today there are around 2.7 million.
The population growth is mainly due to the import of labor – only about 300,000 inhabitants are native Qataris. People from India and Pakistan are mainly recruited for the work, and foreign workers from Nepal and other Arab countries are also employed. Foreigners are subject to a kind of legislative oversight by a guarantor who has extensive powers. The working conditions on some projects, such as the facilities for the soccer World Cup in 2022, are repeatedly criticized because of the prevailing working conditions.
The majority of the population lives in the modern capital Doha on the Persian Gulf, according to the 2015 census, the population is distributed over the eight so-called municipalities as follows:
- Doha: 956,457 inhabitants
- al-Chaur: 202,031 inhabitants
- ad-Da’ayan: 43,176 inhabitants
- ar-Rayyan: 605,712 inhabitants
- al-Wakra: 299,037 inhabitants
- al-Shahaniyah: 187,571 inhabitants
- Ash-Shamal: 7,975 inhabitants
- Umm Salal: 90,835 inhabitants
The state religion is Sunni, i.e. conventional, Islam, the national language is Arabic, even if English and, to a lesser extent, other languages such as Hindi or Farsi are spoken.
Qatar: The emirate is run by a monarchy and makes international politics
With independence in 1971, the new state gave itself the form of an emirate – the Arabic term literally denotes an “authorized person”, i.e. ruler, and can mean both monarchs and princes. Although Qatar describes itself as democratic in the constitution, the emir from the house of Al Thani exercises executive and legislative power without a parliament, but with an advisory council, the Majlis al Shurā.
The basis of the legislation, which is represented by courts in the eight “communities” of the emirate, is Sharia, ie the standards that can be derived from the Koran and the traditional sayings of the Prophet Mohammed.
In some respects Qatar is a state of the 21st century, for example with regard to women’s suffrage, but the official interpretation of Islam is strict and brings the country closer to Islamic or Islamist groups such as the (Egyptian) Muslim Brotherhood. This is not limited to accepting people who are not welcome in other Islamic states, but also includes active financial support for Islamic missions through the controversial Qatar Charity Foundation.
Economic engagement worldwide through the Qatar State Fund
However, the emirate is not only financially active in promoting the faith. The Qatar sovereign wealth fund, which manages the enormous revenues from the oil and gas reserves, buys into attractive companies around the world. Qatari bankers keep an eye out for selecting profitable company shares in key industries. The Qatar state fund holds 17 percent of the ordinary shares of Volkswagen AG, as well as shares in Deutsche Bank and Siemens. Shares are not always or completely acquired through Qatar Holding, but in some cases also through private holdings of the Al Thani family. The emirate invests in:
- Big banks like Barclays or Crédit Suisse
- Infrastructure providers such as Heathrow Airport and Russian Pulkovo Airport
- Chain stores like Tiffany’s, Sainsbury’s or Harrod’s
The SWF seeks broad exposure that covers real estate as well as the financial industry, consumer goods manufacturing and the raw materials sector.
Qatar: economy on the rise
Not only the corona pandemic, but also the multi-year boycott by an Arab alliance, supported by Saudi Arabia and Egypt, bothered the emirate. With a “reconciliation” initiated in January 2021, the economy should also get new momentum.
Qatar has one of the most dynamic economies in the world and is hoping for further economic growth, on the one hand through the soccer World Cup planned for 2022, but also through tourism that goes beyond this. After all, before the boycott, tourists from Saudi Arabia made up around 50 percent of the visitors, and the emirate’s travel industry should also be happy about a normalization of the relationship. The mainstay of the economy is still the income from the oil and gas deposits, which is why the country is benefiting from rising oil price developments.
Whenever the state can book additional income through favorable developments in the oil price, these are used for additional investments. The sovereign wealth fund generally aims for a return of 17 percent annually, which is achieved in most years.
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