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Today we’re talking about a small Western Asian country whose power and wealth are definitely disproportionate to its size.
‘Destination Qatar’ sits on 11,586 square kilometers of land in the Gulf Region, sharing maritime borders with the United Arab Emirates, Iran, and Bahrain.
Once an impoverished British protectorate, Qatar has today grown into the richest country in the world.
Today we’re going to look closer at how the economy of Qatar has evolved over time
and answer the question of just how rich this tiny country is, but first a little background.
Qatar is an absolute monarchy that has been ruled by the Al-Thani family ever since the mid-19th century.
The current ruler is Sheikh Tamim bin Hamad Al Thani.
The state government is structured around a separation of powers as it’s made up of a legislative advisory council,
judicial courts that largely adhere to Sharia law, and an executive council of ministers.
As a way of enforcing his grip on the government, the emir himself appoints all governmental officers; both legislative and executive.
All laws have to receive his approval before being implemented.
Such a monarchial system has allowed this family to remain in power by constantly delaying elections despite the nation’s constitution.
Qatar’s population is predominantly male.
Out of her 2.6 million residents, approximately 1.9 million are male or about 70% of the total citizens.
This imbalance can be traced to the 1970s when there was an influx of male migrant laborers streaming into the region.
In terms of business, Qatar is home to a number of world-renowned conglomerates such as Al-Jazeera, QNB and Qatar Airways.
In fact, a recent report by Forbes ranked it as the 54th best country for business in the world.
But of course it wasn’t always this way, so let’s take a look at how Qatar has evolved over time.
So, how exactly did Qatar come from being one of the poorest countries to the wealthiest in just a few decades?
This fairy tale begins in the 1900s when the country was occupied by Britain and turned into a dependent territory.
During this period, Qatar was granted local autonomy, which meant it could essentially retain its position as a sovereign state.
Despite gaining some independence, the country continued to languish in poverty and intense malnutrition, especially in the 1920s.
It was evident that pearl hunting and fishing were not sufficient enough to support the region’s sustainability.
But then everything changed when oil and natural gas reserves were discovered in 1939.
This was the proverbial light at the end of the tunnel.
Although developments in this sector were initially slow due to World War 2, the country started making substantial progress afterward in 1949.
By 1950, the country was producing up to 46,500 oil barrels every day.
This amounted to revenues worth approximately $4.2 million.
Then the international energy company Shell discovered off-shore reserves and spearheaded their development,
which further increased Qatar’s oil production volumes to 233,000 BPD (barrels per day).
The amount of money flowing into the country shot up overnight, most of which ended up in the ruling family’s bag.
The surge in oil revenues continued well into the 1960s, which meant two things
intense modernization continued and the Al-Thani family grew in wealth as well as power.
Members of the first family gradually took up the majority of the top government positions and were allocated exorbitant allowances by their leader.
The country went on to gain full independence from the United Kingdom in 1971.
One year later, Emir Hamad bin Ali was overthrown by his firstborn son, Khalifa bin Hamad.
Khalifa took on a different leadership approach that favored the local residents
and not a handful of royal family members as was the case during his father’s regime.
Royal allowances were reduced and expenditures on social amenities such as education, pensions, and housing were increased tenfold.
To add on to the mix, the largest field of natural gas was discovered at the same time.
But since petroleum production was still relatively high, the development of this field was postponed.
Nonetheless, this discovery helped Qatar join the ranks of Iran and Russia
by becoming the largest producer of natural gas and oil with an estimated 896 trillion cubic feet of energy resources.
But this rapid economic growth wasn’t without its difficulties.
Qatar faced a number of challenges in its upcoming.
The most problematic one was the oil crash experienced in the 1980s that saw a massive decline in oil prices.
Siphoning of natural gas and oil reserves by top members of the royal family also played a major role in stalling the region’s economic progress.
This oil crisis necessitated the opening of the North Field, but it was not until 1995 that its development was fast-tracked.
Today, the region produces 13% of the world’s natural gas with up to 25 trillion cubic meters and 25 billion barrels of oil.
From this historical account, it is clear to see that the majority of Qatar’s wealth is held by the royal family
as they have found ways of amassing wealth from oil and natural gas development ever since the early 1900s.
However, other native Qataris are also filthy rich.
This wealth is a result of a number of programs and policies that work towards bettering the economic and social wellbeing of its citizens.
At the top of the list is the requirement for Qatari sponsorship for any business, which in turn translates into immense wealth for native Qataris.
The country’s constitution holds that all businesses operating the region have to be at least 51% owned by a Qatari or group of Qataris.
This creates a business landscape that relies heavily on Qatari names.
What’s more, being born Qatari usually means being born rich.
All family-owned enterprises are retained within the family structure since wealth is considered to be a family-based asset.
Children swim in their ancestors’ wealth and so do their offspring…and the cycle continues!
Another important factor is the kind of governance exercised in the region.
The majority of the funds accrued by the government are channeled towards amping up the quality of services and utilities made available in the country.
This is a government that prioritizes its own.
As a testament to this fact, education, water, electricity, and medicine are all free.
For educated Qataris, government jobs are guaranteed in addition to the immense opportunities available within the private sector.
It is the opposite for foreigners as the best they could hope for is a permanent residency, which does not provide one with half the benefits of full citizens.
Now that we’ve covered all of this information, let’s get to the question at hand.
Whoever said “size does not matter” was obviously talking about Qatar.
This country is by far the smallest member state of the high grossing OPEC countries that export petroleum but is also the wealthiest of them all.
This region has continued to experience unprecedented economic growth largely due to its thriving natural gas and oil industry,
which makes up 55% of the nation’s overall GDP.
Petroleum is another high-income earner for Qatar with exports valued over $52 billion in 2018.
That aside, the country boasts of an impressive 99% employment rate and a per capita GDP of $128,702
higher than any other country in the world and about 500 percent higher than the world’s average per capita GDP.
On the flipside, Qatar’s GDP of $357 billion is ranked 50th in the world, but it’s a very impressive number for a country having only 2.6 million people.
This helps support the high quality of life enjoyed by Qatar residents.
Qatar is also ranked as one of the countries with the highest density of millionaires.
A 2014 study by the Bolton Consulting Group shows that 1050 out of every 6000 households in Qatar are worth $1 million or higher.
When it comes to Ultra-High-Net-Worth individuals, this region is ranked sixth in the world.
This means that there is a considerably high number of persons worth $100 million or higher as well as basic millionaires,
which further translates into the country’s overall wealth.
Additionally, it is impossible to overlook the Qatar Investment Authority when speaking about this nation’s abundance of wealth.
It is ranked as the 12th wealthiest sovereign wealth fund in the globe with assets amounting to $115 billion.
Set up in 2005, this body specializes in foreign investments and is responsible for the country’s GDP per capita.
With billions in gas and oil surpluses, the QIA has made numerous profitable investments for Qatar in Europe, Asia Pacific, and the United States.
As of 2016, it was the largest investor in Glencoe and a major stakeholder of Rosneft, an oil conglomerate owned by the Russian government.
It is also a major player in Turkey’s and Brazil’s poultry industry with shares valued at a whopping $470 million.
You can find out much more about this fascinating country by watching our video of the 15 things you didn’t know about Qatar.
Just click in the upper right-hand corner.
There is no doubt that Qatar qualifies as the richest nation in the world primarily due to its vast wealth of natural resources, mainly oil and natural gas.
Qatar’s oil exploration industry is one of the most advanced as it accounts for 85% of the total export earnings,
70% of the revenue earned by the government, and 60% of the GDP.
However, self-love and good governance have also helped this prestigious region to come out on top economically speaking.
Its economic strength has turned this country into a world leader despite it being only about half the size of the small state of New Jersey.
Qatar appears to be on an upward trajectory with no end in sight for its prosperity.
Now that we’re wrapping this topic up, we would like to know:
Let us know what you think in the comments.
And, of course, we appreciate you sticking with us. And to show that appreciation here’s a bonus fact just for you:
Qatar is the biggest landlord in London—bigger than the Queen—with properties worth $51 billion in the European city.
This includes properties in the Olympic Village, Harrods, Canary Wharf, Shard, and the Chelsea Barracks.
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