Why is Qatar the richest country on earth?

Ritu Raj
International Relations
74w ago
· Author has 98 answers and 208.8k answer views

Here is the list of TOP 30 richest countries.

30. Japan — GDP per capita: $38,893 (£31,732)

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29. Finland — GDP per capita: $41,812 (£34,114)

28. France — GDP per capita: $42,384 (£34,581)

27. United Kingdom — GDP per capita: $42,513 (£34,686)

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26. Oman — GDP per capita: $43,737 (£35,685)

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25. Belgium — GDP per capita: $44,881 (£36,618)

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24. Canada — GDP per capita: $46,239 (£37,726)

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23. Denmark — GDP per capita: $46,602 (£38,022)

REUTERS/Bob Strong

22. Taiwan — GDP per capita: $47,790 (£38,991)

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21. Austria — GDP per capita: $47,856 (£39,045)

20. Iceland — GDP per capita: $48,070 (£39,220)

19. Germany — GDP per capita: $48,189 (£39,317)

18. Australia — GDP per capita: $48,806 (£39,820)

17. Sweden — GDP per capita: $49,678 (£40,532)

16. Bahrain — GDP per capita: $50,302 (£41,041)

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15. The Netherlands — GDP per capita: $50,846 (£41,485)

14. Saudi Arabia — GDP per capita: $54,078 (£44,122)

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13. United States — GDP per capita: $57,293 (£46,745)

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12. Hong Kong — GDP per capita: $58,094 (£47,375)

11. Switzerland — GDP per capita: $59,375 (£48,420)

10. San Marino — GDP per capita: $64,443 (£52,553)

REUTERS/Stefano Rellandin

9. United Arab Emirates — GDP per capita: $67,696 (£55,206)

Reuters/Matthias Seifert

8. Norway — GDP per capita: $69,296 (£56,510)

7. Ireland — GDP per capita: $69,374 (£56,574)

6. Kuwait — GDP per capita: $71,263 (£58,114)

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5. Brunei — GDP per capita: $79,710 (£65,003)

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4. Singapore — GDP per capita: $87,082 (£71,015)

3. Macao — GDP per capita: $96,147 (£78,407)

2. Luxembourg — GDP per capita: $101,936 (£83,128)

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1. Qatar — GDP per capita: $129,726 (£105,791)

Thanks

Jayant Shilanjan Mundhra
Politics, Geopolitics and Public Policy Enthusiast
56w ago
· Author has 890 answers and 4.8m answer views

With a total landmass of 11,580 sq. Kilometres, Qatar is a very small independent nation, which is fully covered by deserts and is situated in the center of the entire Middle East. And, until lesser than a century ago, it was one of the poorest nations in the entire region.

It was sparsely populated, because of the inhospitable desert lands where the temperature in summers would climb up to over 50 degrees Celsius. Also, back then it used to be a colony of United Kingdom.

The primary sources of income for this tiny nation used to be its dwindling fishing industry, and extraction of pearls out of the ocean. The days were not very good. However, then in 1938, its first oil field was discovered, and things began to change but only to a minimal extent.

This was so because the oil reserves were not humongous enough to change the prospects of the country. Then, in 1970 something big happened. Oil major, Shell had discovered the world's third largest gas field- The Northern Fields in Qatar. However, back then the only means to transport gas was through pipelines.

The problem with that was this. Every place where there was a significant demand for natural gas, was just too far off Qatar and to lay pipelines to those places would have been an unviable and very costly affair. This wasn't something that the British back then was open to spending on one of its tiniest colony.

However, when Qatar gained independence in 1971, the new Emir had already realized that the only way he could have changed the fortunes for Qatar and its people was by means of trading the natural gas. Thus, he heavily invested monetary resources into research and development of this underdeveloped science called Liquefaction.

Liquefaction is a process of conversion of natural gas to liquid form which can be easily transported in containers loaded over ships and trucks.

And, that investment made back in those times in the later years paid back in ginormous volumes. Within a very short span, Qatar began to export natural gas to nations spanning all across the globe, earning back humongous Petrodollars (Dollars earned by means of Oil and Gas trade).

And, that was how Qatar transformed its fate, from a poor desert nation dependent on failing fishing industry and pearl extraction to a super-rich country with booming infrastructural development and radically improving lifestyle which was also depicted in the marvelous GDP growth rates.

But hang on! I regurgitate what I just said above. That was how Qatar became super rich. And, super-rich does not mean the richest country on the planet. And, that brings us to the second part of this answer.

A lot of nations trade in oil and natural gas and earn a huge lot of money out of it. But, what they do with that money is what decides their fate. Venezuela, for instance, spent it all in outlandish mannerism, and now is a collapsed state struggling on the verge of bankruptcy.

Meanwhile, Qatar took a different path. It spent a lot of what it was earning from gas trade into building the modern capital city of Doha and a infra-structurally jaw-dropping good country. Meanwhile, it also invested a lot of what it was earning. Why?

Because what Qatar spent would be gone. But, what Qatar would invest would earn it back more money even when oil or gas won't. Smart. Isn't it? So, Qatar formed a sovereign wealth fund to strategically invest its fortunes across the Globe in diversified sectors. The body was called, "Qatar Investment Authority."

For ease, let's refer to it as QIA from now on. And, QIA did such a wonderful job at choosing the right assets to invest into, that today its net worth is over $335 Billion! That's a mind-boggling figure making it the eleventh biggest sovereign wealth fund in the entire world.

And, that's the wealth of a nation with a population of just over 2.5 Million, among who Qatari people account for just about 300,000 people! Yep, just five zeros after 3. And, that is what has risen its overall GDP per capita to over $127,000! Just for comparison, USA had registered a GDP per capita of a little lesser than $60,000 in 2016.

This wealth fund made investments in all sort of sectors, be it sports and travel or real estate and technology. Not only has it invested heavily into well-known tech companies like Uber, it also is one of the largest stakeholders in popular companies like Volkswagen, Shell and Russian oil giant, Rosneft.

Then, it also has stakes in the greatest of cities, and their best of properties. I mean, just imagine this. Qatar owns more property in London than the Queen of England does. It owns 34% of the top 15 skyscrapers in London, while the very UK based companies own a little lesser than 21%.

And, when we talk of the iconic Empire State building of New York, we must remember that Qatar owns 10% of that marvel too. Similarly, it has a 20% stake in the British Airways, 20% ownership in the Heathrow Airport and 25% in the St. Petersburg Airport as well. Wow!

And, the money that these investments earn Qatar every month, every year is then invested back into acquiring other valuable assets and also channelled back into the home country to build more of highways, ports, airports, colleges and universities, and more of infrastructural marvels like sky scrapers and much more.

And, that's the tale of Qatar cracking open the juggernaut of wealth creation and becoming the richest country on the entire freaking planet. Bliss!

Regards,

References:

Natural gas in Qatar - Wikipedia
Witnessing a 'Complete Collapse of Society' in Venezuela
Qatar Investment Authority - Wikipedia
Vid 1 | Vid 2

Gabriel Weinberg
CEO & Founder at DuckDuckGo.com (2008-present)
10w ago

Swapnil Khandekar
Mankind must put an end to war before war puts an end to mankind
64w ago
There are multiple parameters that define how rich a country is. Qatar is the richest country in terms of GDP (Gross Domestic Product) per capita.

Following are some reasons that made Qatar top the charts-

Stable Political System
People often underestimate the importance of a stable political system. Unlike many middle eastern countries Qatar has been politically stable ever since its independence. Qatar is an absolute Monarchy ruled by the Al Thani family. The ruling dynasty has been able to provide the Qataris with the highest per capita income in the world. Qatar is classified by the UN as a country of very high human development and is the most advanced Arab state for human development

Exploiting natural resources
Before the emergence of petrol-based industry, Qatar was a poor pearl diving country. The exploration of oil and gas fields began in 1939.Oil was discovered in Qatar in 1940, in Dukhan Field. In 1973, oil production and revenues increased dramatically, moving Qatar out of the ranks of the world's poorest countries and providing it with one of the highest per capita incomes in the world.The discovery transformed the state's economy. Now, the country has a high standard of living for its legal citizens. With no income tax Qatar the unemployment rate in June 2013 was 0.1%.

Lack of any serious home issues
Unlike most countries,Qatar has no problems at home.Thus it allows Qatar intervenes where it sees fit without too much regard for upsetting others, because its policy is simply to engage with everyone it can as often as it can.

Prioritizing
Qatar’s has made a vast expansion of infrastructure at home, as well as its investment abroad. The government has allocated 40 percent of its budget between now and 2016 to infrastructure projects, including $11 billion on a new international airport, $5.5 billion on a deepwater seaport and $1 billion for a transport corridor in the capital, Doha. It will spend $20 billion on roads.The country's sovereign wealth fund, estimated to have assets worth around $70 billion, has poured more than $20 billion in recent years into stakes in German carmakers Porsche and Volkswagen, Agricultural Bank of China, Santander Brasil, Spain's Iberdrola and German builder Hochtief.Its ambitions extend into the realm of sport. In addition to winning the rights to host the 2022 soccer World Cup, Qatar has officially begun a bid to host the 2020 Olympics. It spent $2.8 billion on hosting the 2006 Asian Games.Thus regardless of the size, a country should be pragmatic. A proper vision and self analysis would help transforming the country its best.

Manvendra Singh
Banker at IDBI Bank
64w ago
· Author has 175 answers and 229.4k answer views

How Qatar got so rich so fast

Qatar has been ruled by the Al-Thani family since the early 1900s when it became a British protectorate. On July 17, 1913, Sheikh Abdullah Bin Qassim Al-Thani (center left) became the ruler of Qatar.

At the time, Qatar’s primary industry was pearling and fishing. The country was marked by widespread poverty, malnutrition, and disease from the collapse of the pearl trade in the 1920s.

AP Photo

In 1945, American GIs tried their hand at diving for pearls with professional pearl divers in Bahrain, one of Qatar's neighbors.

In 1939, oil was discovered at Dukhan. Development on the field was slow until 1949 because of World War II. While the oil discovery was significant, it was nothing compared with the natural-gas reserves found 30 years later.

Harrison Jacobs/Google Maps

In 1951, Qatar produced 46,500 barrels of oil per day, amounting to $4.2 million in revenue. The discovery of off-shore oil fields and their development by Shell led to an increase in Qatar's production to 233,000 barrels per day.

AP

Doha's commercial district in 1968.

New revenue from oil exports flooded the pockets of the ruling family, and Qatar began a slow modernization process. The country's first school, hospital, power plant, desalination plant, and telephone exchange all opened in the 1950s.

Embassy of Qatar

An aerial view of Doha, Qatar, in the 1940s.

Oil revenues steadily increased through the 1960s as the Al-Thani family strengthened its grip on power by installing relatives in high government positions. All Al-Thani family members were granted extravagant allowances.

AP Photo/Horst Faas

A Qatari tanker in 1971 offloading oil offshore.

Qatar gained its independence in 1971 after Great Britain announced that it was removing all of its military obligations east of the Suez Canal.

AP Photo

The mouth of the Suez Canal in 1951.

On February 22, 1972, Khalifa bin Hamad deposed his father, Emir Ahmad bin Ali, who was hunting with his falcons in Iran. Khalifa bin Hamad cut the expenditures of the royal family and increased spending on social programs, housing, health, education, and pensions.

AP

This is the Amiri Diwan, or presidential palace, in 1971. The grounds are not even completed yet.

In 1971, the world's largest natural gas field, the South Pars/North Dome Gas-Condensate field, was discovered off the coast of Qatar. Petroleum production was still running high at the time, so the field was not developed.

GeoExPro

Thanks to the North Field, Qatar has the largest natural-gas reserves in the world after Russia and Iran. Qatar's reserves are estimated to be 896 trillion cubic feet.

AP Photo

A Qatari Liquid Natural Gas (LNG) tanker ship is loaded up with LNG at Raslaffans Sea Port, northern Qatar.

The crash of oil prices in the 1980s, along with the emir siphoning off oil revenues, stalled the Qatari economy. The crisis led Qatar finally to develop the North Field in 1989, though even then production was slow.

Bloomberg

By 1995, the situation in Qatar had not improved. Sheikh Hamad bin Khalifa Al-Thani took the throne in a bloodless coup from Emir Khalifa bin Hamad, while the emir was in Switzerland. Sheikh Hamad set a whole new direction for the country.

AP Photo

One of Sheikh Hamad's first moves was to fast-track the development of the North Dome field. Production was ramped up, and Qatar began exporting liquid natural gas for the first time.

EIA

To accommodate increased production and demand, Qatar began building new liquid-natural-gas plants. Over the past 15 years, 14 liquid-natural-gas plants have been built in partnership with international oil companies.

In the late 1990s, Qatar entered into production sharing agreements with numerous international oil companies. The new companies began using horizontal drilling methods to reverse declines in oil production. Qatar's partnership with Maersk Oil resulted in the world's longest horizontal well.

In 1996, Qatar built the gigantic, billion-dollar al-Udeid air base, which has served as a logistics and command facility for the US Military. The partnership with the US military has given Qatar an unprecedented level of security.

In 1997, Qatar began long-term agreements to provide massive amounts of natural gas to Spain and Japan. Over time, Qatar further diversified its clients.

International Energy Agency

Qatar's GDP has skyrocketed over the past 15 years, thanks to steady oil production and high natural-gas production.

Hoping to avoid the dreaded resource curse, Qatar has taken measures to diversify its economy. In 1998, the government built Education City, a massive campus that supports six American and two European universities, as well as research centers.

Sam Agnew

Qatar has amassed a sovereign wealth fund of $170 billion thanks to revenues from oil and natural gas. It has begun to invest it like a hedge fund.

In 2003, Qatar established the Qatar Investment Authority to recycle oil and gas income into other income streams. QIA has made big investments in Barclays Bank, Credit Suisse, Harrods, Porsche, Volkswagen, and a majority stake in the Paris Saint-Germain soccer team.

Qatar has become one of the largest holders of real estate in London through the QIA. Qatar owns The Shard, Western Europe's largest skyscraper, as well as large parts of Canary Wharf and other parts of the city.The Qatar Financial Center was built in 2005 to develop Qatar's financial services industry. The country believes it can become a financial-services leader for Gulf states thanks to its relative stability and large base of capital.

Qatar Financial Centre

In 2006, Qatar passed Indonesia to become the largest exporter of liquid natural gas in the world with revenues from oil and natural gas amounting to 60% of Qatar's GDP. But more competition was coming, with liquid-natural-gas production booming in places including the US and Australia.

This Qatari tanker is the largest in the world.

In December 2010, Qatar was selected as host for the 2022 FIFA World Cup. Qatar promised to build 12 state-of-the-art stadiums that would employ cooling technology so players could escape the heat. Qatar has positioned itself as a sporting hub for the region, hosting or planning to host numerous global sporting events.

The skyline has changed dramatically in recent years.

Since 2000, 58 skyscrapers have been built or planned or are under construction in Doha, along with museums, stadiums, giant infrastructure projects, and more.

There have been widespread allegations of horrific working and living conditions for the migrant workers who are building the World Cup sites and other projects. Last June, it was alleged that Qatar spent $5 million on bribes to secure the 2022 World Cup bid. Switzerland is now opening an investigation into mismanagement and money laundering related to Qatar's bid.

Ex-FIFA VP Mohamed Bin Hammam, often referred to as the Qatari Machiavelli, is said to have spent millions on bribes and gifts to secure Qatar's bid.

Can Qatar become the Hong Kong of the Middle East, or will it fail to escape the resource curse or get dragged down by regional instability? It's one of the hottest questions in the world right now.

Meanwhile, it's good to be Qatari ...

Source - Google and business insider

Param Veer Sawarkar
57w ago
Qatar is not the richest country in the world. Qatar has the highest per capita income in the world. Qatar was a small country given as a unwanted Gift by the Saudi King to his kin as there were no fossil fuels observed. How ever, discovery of natural gas reserves came as a shocking suprise. And the new Monarch quickly turned from wahabi to salafi. Since then the two kingdoms are insecure of each other. Natural gas is an important requirement to people as we use it in Lpg cylinders.Qatar has huge natural gas reserves and cng reserves Too. It's Population is extremely small and so it is understandable as to why they have a high per capita income. However they are not richest because the Total economy is just around 150 Billion. Compare that to USA which stands at 18.8 trillion.

Nitesh Rao
Making music at the border of insanity & madness.
64w ago
· Author has 210 answers and 391.9k answer views

Qatar, no doubt is the richest country, boasts about $130,000 GDP Per Capita, the highest in the planet.

Qatar is a high-income economy, backed by the world's third-largest natural-gas reserves and oil reserves.