Qatar scales back ambitions amid financial constraints

A paraglider pulls a flag showing Sheikh Tamim bin Hamad Al Thani on Qatar's National Day (December 2013) Sheikh Tamim became the world's youngest reigning monarch when his father abdicated in 2013

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When Sheikh Tamim bin Hamad Al Thani succeeded his father as emir of energy-rich Qatar in June, few observers knew very much about him.

A graduate of the Royal Military Academy Sandhurst, the 33-year-old was said to be conservative and cautious, the antithesis of the image of a flamboyant Gulf prince.

Sheikh Tamim inherited a country whose big ambitions at being a regional - even global - power were foundering.

Its support for Islamist movements in revolutionary Tunisia, Libya, Egypt and Syria was backfiring, straining relations with Western allies and Gulf neighbours alike.

Meanwhile at home, conservatives were increasingly vocal in the criticism of what they perceived to be the wholesale importation of Western cultural and educational institutions and values.

Sovereign wealth

But the new emir was fortunate because, despite spending hundreds of billions trying to fulfil a variety of ambitions, the state coffers remained full.

By any economic measure Qatar is in a league of its own.

With a small indigenous population - roughly 275,000 out of a total of 2 million - the country has the highest GDP per capita in the world and the lowest unemployment rate.

In an energy-hungry world, it has massive reserves of hydrocarbons and highly-sophisticated infrastructure to deliver them to global markets.

Sheikha Moza and Hamad bin Khalifa Al Thani in 2011 Sheikha Moza, the wife of the former emir Sheikh Hamad, is in charge of the Qatar Foundation

The country's sovereign wealth fund, the Qatar Investment Authority, had assets worth more than $115bn (£70bn) at the end of 2012.

With that sort of money at their disposal, one would expect the Qataris to "spend, spend, spend". And spend they have.

Start Quote

Qatar is committed to the World Cup and the tens of billions in infrastructure costs that surrounds it, but government revenues have plateaued even as costs continue to balloon”

End Quote Kristian Coates Ulrichsen

Qatar has bought up banks all over the world, football clubs in Europe, and properties in the heart of London with some of the highest price tags on the planet.

It has armed rebel groups seeking to topple the rulers of Libya and Syria, and poured billions of dollars into an ultimately futile attempt to shore up the government of Egypt's ousted Islamist President Mohammed Morsi.

It has also set aside billions more to fund the the Qatar National Food Security Programme (QNFSP), which seeks to maximise the country's available water and land resources.

Then there is the bill for the 2022 football World Cup.

The emirate's original bid called for 12 air-conditioned stadiums, extensive transport infrastructure, and even a new city to be built, at a cost that some experts have put at more than $200bn (£122bn).

And they have spent hugely on culture, the arts and education. Sheikha Moza, the wife of the former emir Sheikh Hamad, and their daughter, Mayassa, are in charge of a soft-power empire intended to enhance Qatar's global profile.

The sheikha chairs the Qatar Foundation, which has encouraged Western universities and think tanks to set up shop in the capital, Doha.

Qatar Museum of Islamic Art Doha's Museum of Islamic Art houses one of the finest collections in the world

The non-profit organisation was established in 1995 with a mandate to "support Qatar on its journey from a carbon economy to a knowledge economy by unlocking human potential".

Sheikha Moza and her daughter also oversaw the creation of the Museum of Islamic Art, which opened in 2008 and houses one of the finest collections in the world.

So it must have seemed to them and others that the money for their projects would never run out.

But when the emir abdicated and his son took over, a chill wind began to blow.

Renewable energy

In September, the Qatar Foundation scaled back its ambitious English and Arabic radio services.

Four months later, the Doha Film Institute laid off dozens of employees and postponed the inaugural Qumra Doha Film Festival that had been scheduled to take place in March.

Qatari men watch a speech by Qatar's former emir in June 2013 Many Qataris found the pace of change orchestrated by the former emir too fast

After initially saying it hoped Qatar would produce 70% of its own food by 2023, the QNFSP is now aiming for 40% domestic production. The man who was its driving force, Fahad al-Attiya, has also stepped away.

Experts see that as a sensible decision.

Jim Krane, a Gulf energy analyst, calls the food security programme "wrong-headed".

"The programme's investment into Qatari agriculture never made any sense," he says.

Mr Krane explains that the current burning of natural gas to power groundwater desalination plants that can produce water to irrigate crops grown in the desert is exacerbating Qatar's already huge carbon emissions.

"It only adds to Qatari embarrassment as the owner of the world's largest per-capita [carbon] footprint," he adds.

However, Jonathan Smith, director of communications for the QNFSP, said it had always been its intention that the desalination systems would be powered solely by renewable energy, and not gas.

He added that the 40% domestic production scenario "uses the exact same amount of land that is in production today and one third less water to deliver five times more food in some of our most strategically important categories".

Mr Smith also stressed that Mr Attiya had "finished the job he was given, presented the National Plan, won approval for its implementation and worked around-the-clock to see that an implementation unit was empowered and put in place".

'No-expense-spared' policies

And Gulf commentator Kristian Coates Ulrichsen argues that Qatar needs to move "decisively away from the 'no-expense-spared' policies of recent years".

Al-Sadd Sports Hall under construction in Qatar (23 December 2013) Qatar's original World Cup bid called for 12 stadiums; now it is prioritising eight

"The problem for Tamim is that Qatar is committed to the World Cup and the tens of billions in infrastructure costs that surrounds it, but government revenues have plateaued even as costs continue to balloon."

The Qataris are no longer talking of building 12 stadiums. Rather, the 2022 Local Organising Committee now says it is "prioritising eight stadiums".

But despite scaling back on what seemed to most observers a huge number of venues to pack into such a small country, the emir's support for the World Cup remains solid.

Any talk of withdrawal would represent a huge blow to the country's image.

While steering the country away from other expensive and overly ambitious schemes, football's premier event remains a cost Sheikh Tamim will have to bear.

But his retrenchment in other areas will play well with many ordinary Qataris, who have found the pace of change orchestrated by his father and mother too fast for comfort.

Correction 13 February 2014: This story has been amended after an earlier version incorrectly reported that the QNFSP planned to burn natural gas to power desalination plants.

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