Qatar’s Journey to Riches: How did it Become One of the Richest Countries in the World

Qatar is a small independent nation, with a total landmass of 11,580 square kilometers and it is fully encapsulated in desert. Less than a century ago, it was one of the poorest countries in its region. Its inhabitants experienced high temperatures in the summer, and its primary sources of income were a diminishing fishing industry and the extraction of pearls from the ocean.

In 1938 however, Qatar’s first oil field was discovered, only increasing the country’s minimal income. Then, in 1970, something momentous occurred – Shell discovered the world’s third largest gas field in the country – the Northern Fields. While this achievement held a lot of potential, the only means of transport available at the time was through pipelines. This would be an expensive endeavour and the British, who colonized Qatar, were against investing any money in the small country.

When Qatar gained independence in 1971, the Emir had a plan to turn the country’s fortune around – natural gas trade. He made considerable investments in researching and developing Liquefaction, which is a process of converting natural gas to liquid form and easily facilitating transportation in containers loaded over ships and trucks. These investments paid off in the long run and Qatar began to trade natural gas globally, making vast amounts of petrodollars from the process.

Qatar was then able to use this wealth in favorable ways, such as investment in infrastructure, rather than needless spending as Venezuela did. The Emir formed the Qatar Investment Authority (QIA), a sovereign wealth fund where he strategically invested funds earned from gas trade. As a result, the net worth of QIA is now estimated at over $335 billion, making it the 11th biggest sovereign wealth fund. This resulted in a tremendous GDP per capita of over $127,000, surpassing the US which stood at approximately $60,000 in 2016.

QIA invested in an array of sectors, including sports, travel, real estate and technology. Some of Qatar’s investment in well-known tech companies include Uber, Volkswagen, Shell and Russian oil giant, Rosneft. It also holds stakes in some of the world’s most renowned cities and properties – more in London than the Queen of England herself! Not to mention 10% stake in the iconic Empire State Building of New York, 20% in the British Airways, 20% in the Heathrow Airport and 25% in the St. Petersburg Airport.

Qatar has been adept in managing its wealth, continually reinvesting the petrodollars into obtaining valuable assets for the nation.
This has enabled Qatar to become one of the richest countries in the world through its investments and astute handling of funds.