Qatar to slow 15% of planned projects

A general view of Doha. After Qatar won the right to host the World Cup it announced plans for a raft of projects that would transform it over the following 15 years. — Reuters

Qatar is likely to reschedule about 15 per cent of its planned building projects for coming years and go over budget, amid a push to complete preparations for the 2022 World Cup soccer tournament, sources familiar with government policy said.

After it won the right to host the World Cup in 2010, the tiny nation, with a population of about 2.1 million, announced plans for a raft of projects that would transform it over the following 15 years. They include a new airport, roads, port facilities, railways, stadiums and other infrastructure.

The government has not released a comprehensive, detailed schedule of its construction plans, but analysts estimate they will cost between $140 billion and $200 billion through the early 2020s, paid for with the country’s vast natural gas wealth. This is expected to provide a bonanza to the foreign construction firms that will do much of the work.

But so far, contract awards and work on many projects have been slower to get started than the business community expected, apparently because of bureaucratic and planning problems. If they are not handled carefully, the projects could destabilise Qatar’s small economy, creating bottlenecks and driving up costs.

A government source, declining to be named under briefing rules, acknowledged that Qatar faced pressures in pushing through the projects and would have to slow some, though he stressed that construction specifically for the World Cup would take priority and be completed on time.

“About 15 per cent of the projects will be rescheduled,” the government source told Reuters.

“All projects associated directly with hosting the World Cup cannot be rescheduled since they have to finish by 2022. But there are others which can be moved.” The source did not give details.

Qatari officials have declined to discuss changes to the construction schedule publicly. Earlier this week, the central bank governor said the government was expected to sign contracts for construction projects worth as much as $50 billion this year, but he did not elaborate.

Yasser Al Mulla, project manager at Al Rayyan Precinct for the Supreme Committee for Delivery and Legacy, which is handling construction of tournament venues, said this week that all World Cup projects were on track to be completed on time.

Another factor is the sheer difficulty of assembling enough construction workers, materials and equipment from around the world. Qatar needs an additional 400,000 workers for its next phase of development, the government source said.

A third factor appears to be cost. Qatar does not seem to face any difficulty financing its projects; the government’s budget surplus was $27.3 billion, or a huge 14.2 percent of gross domestic product, in the fiscal year to last March.