Ahmed Al Khalaf
DOHA: The budgetary estimates for the current fiscal year (2013-14) with increased public spending, that were unveiled yesterday, have evoked mixed response from the country’s trade and industry, with the private sector lamenting that foreign companies are being preferred for mega projects at its expense.
And at least one top corporate executive said larger outlays for development projects would make more sense and would be more convincing if the government also declares how much of the amounts earmarked for development in the last budget (2012-13) have actually been spent.
“Also, infrastructure development projects are long-term and take at least five years to complete so how yearly outlays are going to be helpful,” asked Nasser Al Khaledy, CEO of Qatar-Oman Investment Company, a listed entity.
He added: “We don’t know how much of the sums that were earmarked for development in the last budget have been spent, so how can we be sure what has been allocated in the new budget is going to be spent.”
Al Khaledy said he didn’t see much benefit in the budget for the private sector since major contracts in development projects were always awarded to foreign companies and the local firms were just left playing a supportive role.
“They only get sub-contracts.” The government, according to him, is sincere about supporting the private sector and has been making laudable effort in that direction.
“But, sadly, the effort isn’t bearing the desired fruit.”
The government believes that local companies do not have enough expertise and capacity to handle mega projects.
“But the fact is that although it might have been true a decade ago, today the situation is different. There are many local players that are quite capable of handling large projects,” said prominent businessman, Ahmed Al Khalaf.
He, though, hailed a larger outlay for public spending in the current budget and said it would overall lead to added vibrancy in the local market, more foreign workers would arrive, and the trading activity would accelerate.
Al Khalaf said that rules were in place that foreign companies bagging contracts here must have tie-ups with local players but they (the rules) did not specify the ratio or the extent of the partnership that they must have with local entities.
Due to this, foreign companies entering tie-ups with the local players and awarding them sub-contracts dictate terms and impose a lot of conditions, some of which are so difficult to comply with. “So, in my view, the regulations should specify a percentage of partnership that a foreign entity must give to its local counterpart,” said Al Khalaf.
“We have examples like the new airport, the upcoming Doha Port and so many other mega projects in which local companies have been relegated to playing only a supportive role,” said Al Khaledy.
This is the biggest budget in Qatar’s history so far and it will have a positive impact on all aspects of life and economy, said Al Khalaf.
“It bodes well for the country. The pace of development is being upped.”
“I would say that the private sector needs more support from the government to play a more proactive role in the national economy,” he added.
The Peninsula
