Inward investment

This month our local insight focuses on Qatar, as we speak to the Managing Director of one of the country’s leading AV distributors and integrators, TechnoQ.

In a region of fast growing economies and oil wealth, Qatar was a little late to the party compared to near neighbours the UAE, Saudi Arabia and Kuwait. It is only really in the last ten or so years that Qatar has begun it’s meteoric growth. Fuelled largely by investment to leverage what amounts to the world second largest reserves of natural gas, the country’s cumulative GDP growth since 2000 is nigh to 60%. A GDP per capita of $60,000 makes it one of the world’s richest countries.

A flurry of public investment in roads, housing and tourism infrastructure related to the Asian games, which the country hosted in December 2006, resulted in further construction growth. However this strong growth has come at the price of inflation, which reached a record level of 15% in the first quarter of this year. However local business leader Mr Zeyad Al Jaidah, CEO of TechnoQ is philosophical about these growing pains. “Inflation and price inflation are real problems for us. The economic growth is good and bad at the same time. It represents a challenge. But what is life without challenges?”

A man can perhaps afford to be philosophical when business is going so well. “We are really under pressure this year and I think this will continue for at least two or three more years. In terms of the volume of work, and in terms of ensuring that we are able to maintain the quality that we want, there are real challenges at the moment. If you have a limited number of people available to do the job, with the volume of work we have at the moment it’s bound to affect quality. We are working extremely hard to make sure the quality we produce remains high.”

With so much work available, the people who really feel the pinch are the project managers, often juggling several important clients at once. However one group not often thought of are the sales team. Al Jaidah remarks that they are struggling even to get quotations out on time due to the volume of work required.

Qatar’s growth has been carefully orchestrated by its leaders. “Here in Qatar we are trying to do many things differently,” explains Al Jaidah. “For instance in Dubai they are really the commercial hub of the region of the region, and we’re not challenging that. Here what we’re trying to do is to be the educational, cultural and sporting hub of the region.”

Championing the country’s educational development, despite some criticism from within, is the Emir’s wife, Her Highness Sheikha Mozah bint Nasser Al-Missned. Whilst it may not be making immediate returns on the considerable investment involved, Al Jaidah believes that it’s essential for the development of Qatar. “The universities are costing huge amounts of money, but she is doing something for the long term good of the country. We are lucky to have someone like her, she believes that a lot of the political problems in the region are down to a lack of education. The partnerships with the major western universities are a really positive step.”

These partnerships take the form of universities such as George Town opening new campuses in Qatar and then linking them educationally and electronically to the home campus. Most of TechnoQ’s business at the moment comes from these enterprises. They are highly sophisticated installations involving full room control solutions with touch screens and Smart boards in every classroom. The latest phase of one project that the company is undertaking is the installation of a full duplex videoconference link with the USA campus to allow remote teaching. “The specification of these facilities is probably higher than in the oil and gas industry,” said Mr Al Jaidah.

For all its growth, Qatar does have its own problems. The legislative and regulatory structures haven’t been developed as effectively as those in Dubai to cope with the huge influx of people and products. One example, which is particularly relevant to the AV integration market, is the wireless licensing situation. “Until recently, wireless communications in the country were regulated by the only service provider. They have the power of approval over every wireless product entering the country, even a wireless microphone system. It’s a crazy system, if I want to import a product I need a license, but once I have that, everyone who wants to use or purchase the system also need their own license. This can really slow down projects and is very frustrating.“

The establishment of ictQatar around two years ago was designed to alleviate these kinds of problems by forming an independent regulator, but progress has been a little slower than hoped.

A problem that Qatar shares with the AV industry in the rest of EMEA is getting good people: “Man power is a really, really big problem for us. I’m talking about all levels of knowledge – engineers, programmers and technicians. We can’t hire Qatari’s because there are only around 250,000 of them and they tend to look for more rewarding jobs.”

As with many of its neighbours, the nationals make up only a fraction of the total population. Qatar’s is estimated at under one million in total. To make matters a bit harder, the government puts restrictions on the numbers of the various nationalities that can be hired, in an effort to avoid any one of the itinerant minorities becoming bigger than the others. This really limits the pool of possible recruits for companies like TechnoQ with quite specific requirements regarding the staff they need.

Linked to the issue of recruitment is that of training. Whilst it is not readily recognised in Qatar, TechnoQ has a large number of its staff CTS certified. “At the moment it’s more for our benefit,” said Al Jaidah. “The customers haven’t heard of CTS or InfoComm, but now the size and complexity of projects is increasing we are having more international consultants and contractors involved. As that happens we will probably see more comments and questions about CTS.”

Like so much of the Middle East it’s hard to get a handle on the meaning of the numbers. What exactly does a GDP per capita of $60,000 mean? For Al Jaidah and others in the same business it means that the government has a huge amount of cash to spend on inward investment. It doesn’t look like that situation will change any time soon.

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