Dr. Ibrahim Ibrahim, Economic Adviser to the Emir – Qatar
A key figure in shaping Qatari economic policy, Dr. Ibrahim Ibrahim discusses the way that Qatar has chosen to turn its national vision into reality, and the continued importance of gas for the country at a time of diversification.
You were instrumental in putting together the Qatar National Vision (QNV) that was approved in 2008. To what extent have the needs of Qatar changed in that time? How will you reach 2030 making sure that you are still going in the right direction?
Our development process is not reliant only on the Nation Vision: there are many links in the chain. The major link is indeed the National Vision, which looks at where we want to go as a country, and the kind of society we want to have. The vision addresses this through four pillars of development: economic, social, human and environmental.
The second link in the chain is the National Development Strategy, which serves as a six-year roadmap that explains where we want to go, but also how to get there. In this strategy, we have measurable targets spread across more than 150 programs that will reach objectives in 14 sub-areas of the four national pillars outlined in the National Vision. These programs address national priorities, looking at what can be achieved in different sectors during the six years.
One critical element of the National Development Strategy is that these objectives are spread across different sectors and institutions: although one institution will own each one, they are designed with the aim of encouraging both cooperation and competition between sectors. They also address challenges holistically: when we look at the challenge of water, we look at the issue from production, consumption, conservation and recycling.
The third link in the chain is executive plans, that are consistent with the vision and the strategy, and deal with the financing of different projects within each institution.
These three links help to make sure that there is some level of oversight, planning and adaptation as Qatar moves towards achieving its general aims and goals.
Qatar has been able to achieve great things because of its resource wealth. What role will oil and gas play in an economy that is looking to move from being resource- to knowledge-based?
The Qatar National Vision was created in order to ensure that the country is not forever dependent upon oil and gas; however, that does not mean that we are ignoring the fact that we currently rely on them very heavily, or that in the future, we will ignore them . The vision for Qatar stretches beyond 2030, to a hundred years from now, taking into consideration all that might happen in that time. On such a timeframe, it is natural that we are addressing what will happen after our gas resources are gone. Gas may cease to be important in the global landscape even sooner than this – we want to make sure that if this does happen, by 2030, our economy will be developed enough to sustain prosperity.
Having said this, we fully believe that gas will remain important around the world, especially since the discovery of shale gas, which was a blessing in disguise for Qatar. It will lengthen the duration of the world’s dependence on gas. Shale will also reduce the pressure on us as a Middle Eastern producer: because the US will now produce and sell its own gas, we will not have to face quite the same level of criticism for controlling their energy markets.
We expect gas to remain important, and in this context it is therefore important for us to stay competitive. To do this will while at the same time diversifying our economy will be difficult, but Qatar has come through difficult periods successfully before, and we can do it again.
Why was the moratorium on North field necessary?
Unlike other countries, which have their gas reserves located in multiple reservoirs across different geographies and geologies, Qatar has the vast majority of its gas in one large reservoir, which is an extremely high-risk situation: countries like Iran can produce more from a fairly equivalent amount of reserves because their gas is spread out across multiple reservoirs, but Qatar’s production could be seriously affected by incorrect or rushed exploitation.
As a result, the moratorium has been a blessing for us: it gives us a chance to take stock and ensure that we are not exhausting our reserves faster than we should as a result of bad planning.
With shifts in the global supply and demand of gas, one thing is certain: there will be more players in the global gas market in the years to come. Given Qatar’s diversification strategy, how important is it for the country to maintain its leading position as the world’s largest LNG exporter?
Different people in the industry will tell you different things, but to me, fighting to maintain the position of number one exporter is a waste of time and energy: sometimes it has negative consequences to be at the top of the pile. What Qatar should aim for is the optimal exploitation of the gas that it has.
However, one thing that this number one position has led to is the fact that globally, we are very competitive when it comes to gas and LNG. We offer pricing based on benchmarks chosen by the customer, and are not tied to any particular pricing location.