Speech by His Excellency Sheikh Hamad bin Jassem bin Jabr Al Thani
Prime Minister and Minister for Foreign Affairs at the Forum of
"Incorporating the Private Companies: Strengthening the Qatar National Vision”
Four Seasons Hotel - Doha
May 8 th
In the name of God the Compassionate the Merciful
Peace and God's mercy and blessings be upon you.
I am pleased to welcome you to this conference on one of the most vital issues for Qatar’s economy.
At a time when the global economy is going through a transition to a new stage that increasingly requires concerted efforts to develop the pillars of our economy, ensure its continuity and achieve success and prosperity, I am pleased to meet with this elite group of Qatari business owners and business leaders in this conference, that we hope would be a step towards that end.
It is important to point out at the beginning in the context of our conversation, to the benefits of incorporating the private companies in the stock market and to the great importance of the private sector in the success of the national economies. We in Qatar attach great importance to the issue of developing the private companies and the private sector, in line with the Qatar
National Vision 2030, which is inspired by the wise vision of both His Highness the Emir of our country Sheikh Hamad bin Khalifa Al Thani and His Highness the Crown Prince Tamim Bin
Hamad Al Thani. We will therefore focus our efforts today on developing the relationship between the Government and the private sector from the perspective of the Qatar Vision 2030 and the National Development Strategy 2011-2016, that aims to achieve sustainable development and build a diversified economy.
It is our priority to develop the capacities of the Qatari citizens and increase their opportunities to enable them to build a prosperous society in a globalized world that is characterized by continuous change and competitiveness, and to develop a diversified and competitive national economy that is capable of meeting the needs of its citizens in the present and the future.
You are all aware that the State has allocated a huge budget to spend on infrastructure, education, youth and health care projects. The total value of those projects is expected to reach about $200 billion over the next decade.
Within this context, the private companies have an important role to play in the process of the economic growth by increasing production, diversifying the economy, creation of fixed capitals and developing real assets in the economy. It is based on this that the Government can assume its role in ensuring a favorable regulatory environment and adopting economic policies that are geared towards creating a climate conducive to the business sector, achieving the overall objectives and meeting the challenges of development.
Qatar’s economy has gone through positive changes. The developments in Qatar’s national economy in expanding the contribution of non-oil sectors in the economy and its support for the process of diversity, and the clear and growing role of the private sector in increasing production and investment in those sectors, have taken place thanks to the policies and strategies implemented by the Government, that have focused primarily on the development of the private sector and on strengthening its role in the economic development. However, the role of the private sector as one of the pillars of diversifying income sources has not thus far reached the desired level and much remains to be done to develop it. The responsibility for doing so rests with both the Government and the private sector.
I am confident that the private companies will work towards taking advantage of the opportunities to become incorporated in the stock market in order to meet the development challenges of the present and the future. It is therefore necessary to take initiatives to support and strengthen the role of the private sector in development, so it would become an active and significant partner in achieving the desired economic and social development.
In addressing the benefits of incorporating the private companies in the stock market, it is imperative to mention the significant development that Qatar Exchange has gone through during the past few years, since its creation, at the technical and organizational levels. The stock market is an important component of our national economic fabric, and such development provides our shareholders with multiple investment options, especially since the market is in need for incorporating more companies in the coming period to keep pace with the rapid economic growth of the country.
You are all aware that the creation of the market of emerging companies in the Qatar Exchange that targets small and medium enterprises is an essential step towards the advancement of an important sector such as the market of emerging companies, for it generates a strong motivation for emerging companies to look for a new source of funding by raising their capitals without having to face debt risks.
We also stress the need to gear those companies towards operating in the era of globalization and open markets. In such global settings, a fair value of the stock prices of those companies, transparency in their financial performance and status data, and a prestigious financial and economic reputation, provide them with a powerful bargaining chip they can use when faced with the option of integration and expansion in the future, and which constitutes one of the basic tools for their growth.
Incorporating the shares of companies in the Qatar Exchange requires the latter to provide the businesses and the stocks of those companies with all its support, media, advertising and marketing capability. Incorporating those companies in the stock market is in fact to register their names, shares, businesses and achievements in all the local and global media with which the markets interact.
The importance of incorporating private companies and family-owned businesses stems from the economic heavy weight of those companies in a large number of vital sectors in the country.
Turning family-owned businesses into incorporated joint ventures increases the overall effectiveness of the economy, and has a positive impact on the local economy as a result of developing standards and controls for family-owned businesses, which represents a real added value to the national economy.
Given the number of incorporated companies at the moment, we believe that their number does not reflect the size and position of the Qatari economy due to the fact that large influential economic entities still remain outside the market.
Increasing the number of joint stock companies has a significant positive impact on the economy as a whole. Joint stock companies are often created by a large group of founders willing to invest in large capital projects, such as energy, telecommunications and infrastructure projects, where it is difficult for individuals to do heavy lifting on their own. Every country therefore needs this type of companies so that they can help the governments provide basic services to their citizens.
Furthermore, the financial market is one of the most important standards used by foreign investors to determine the strength of the economy. Therefore, the existence of a strong financial market that includes a large number of giant companies with good financial performance would be a great help for the Government to easily attract foreign investment.
It is within this context that we want to focus on the importance of transforming family-owned businesses into joint stock companies, as a first step towards incorporating them in the financial market. Such action would ensure their continuity and growth, while helping in developing the market, expanding its base and diversifying its sectors. It would also reflect the commitment of those companies to disclosure and transparency standards and regulations and to governance requirements to comply with the best global practices.
I conclude by inviting you to participate in the efforts to achieve the sustainable development that we seek. I also invite you to coordinate your efforts with the stock market and entities supervising the financial markets and the business community in Qatar in order to reach the desired goals.
May peace and God's mercy and blessings be upon you.