Qatar Boosts Financial Services with $2 Billion Investment

Much Needed Injection

In order to boost the development of Qatar as a center of finance in the Middle East, Qatar’s sovereign wealth fund has been quietly injecting up to $2 billion into the finance economy to allure asset management companies to establish themselves as key players in Middle East finance.

Lackluster so Far

According to regional bankers the Qatar Investment Authority will invest the money in international and area asset managers who plan to set up business in Qatar. This is in response to the failure of the Qatar Financial Center to bring in a large customer base.

The development of Qatar’s financial sector will not be easy as other Gulf Co-operation Council states are also working hard to boost their own financial industries by exploiting the huge amounts of capital gathering in the oil-rich region. There is additional competition from the emerging Asian economies, which are conveniently located for investors from the East.

The QFC’s acting chief executive, Shashank Srivastava, said,

“The growth market is changing – its east of the GCC, not west of the GCC. New financial centers will emerge for geographic reasons, and for pure financial efficiency reasons.”

To Develop and Regulate

The goal of the QIA for their investment is to encourage additional business to the QFC. The QFC was established in 2005 to regulate and also aid in the development of Qatar’s financial services industry, according to bankers who are knowledgeable of the plan. So far the center has licensed approximately 150 companies, but it has not been able to create excitement in investing, and the experts have admitted that the amount of assets under Qatar management is meager.