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Qatar Today December 20052 Qatar TodayDecember 2005

level. On the micro level, what we dto exert efforts on promoting investmein manufacturing, enable diversion ftraditional real estate, and import/port businesses. Manufacturing is newpeople in the GCC and are not useor comfortable with. It is high risk long-term investment but with gpromising returns. We need to build disseminate the culture for that. Weto promote manufacturing investm

  by studying technologies, the maprepare feasibility studies and then trpromote that among private investor

“The Energy sector inuences all osectors. With high oil prices, you willconstruction boom, nancial boom...want economies that are more diveed and less vulnerable to oil price tuations. People think high oil pricesgood omen. There are positive and ntive shocks. We want more resilient vibrant economies.”

On the increasing number of zones coming up in the region vers

F o c u s

The Gulf Organisation for IndustrialConsulting (GOIC) has stepped upefforts to bring more FDI into the

ulf States. It is moving towards settingp SPX (Subcontracting and Partnershipxchange) unit in Doha with focal points

all the GCC states. Through linkingatabases that facilitate more coopera-on and partnership between local andternational companies the ow of FDIill increase into the region.At present, the GCC’s share of totalorld global FDI is rather low, and itcrucial that the investment climate

ade more attractive, said Dr Lulwa Alisned, Assistant Secretary General fordustrial Research and Investment Pro-otion, GOIC.In an interview to Qatar Today  , Dr Alisned said in terms of FDI, UAE camest, and Qatar and Bahrain follow. How-

ver, GCC in general has a very low shareFDI in terms of the total world ow.“Some people would say that countriesith such abundant resources don’t need

DI. It is a narrow thought that does notok at the other benets, like new ven-res, transfer of technology, managerialpertise, and interaction with the mar-ting network. These are very vital for

n economy – to be exposed to the bestusiness practices.”She added, “The economy is opening

p, nancial centres are being set up, andat will bring in more than just banksit will open up the nancial sector to -lly. It will improve project nance. The

uccess of these projects will depend onow much FDI they bring in. The Sci-nce and Technology Park provides anpportunity for strategic alliances andartnerships. The success of STP and thenancial Centre will depend on howuch R&D it brings to the country and

ow much expertise (in management,st business practices) comes in.”“GOIC SPX focuses on desalination

nd petrochemicals, as these are theost important buyers in the region andould be the main source of businessregion small and medium industries.hile we are looking at bringing in FDI,

we also want to provide opportunitiesfor local companies. We are linking largeand small companies by encouraginglarge industries to sub-contract to small-er ones. We would also like to integrateindustries strengthening linkages anddisseminate the concept of value chain.There are some products that large in-dustries use, that can be manufacturedlocally by SMIs, without depending onimports.”

Elaborating on GOIC’s role, she said,“We provide an integrated set of highquality, client-focused research, informa-tion, and consulting services on indus-trial and economic development issuesof critical importance to governmentsand industrial customers in GCC mem-

  ber states. Our mandate is to promoteindustrial cooperation and coordinationamong the six members of the GCC Stat es(UAE, Bahrain, Saudi Arabia, Oman, Qa-tar and Kuwait), and to foster industrialdevelopment both at public and privatesector levels,” said Dr Al Misned.

“We collect and publish data and in-formation on industrial projects andpolicies. We suggest viable industrialprojects that can be implemented by theGCC States on a joint-venture basis. Forexample a project that was taken up bythe Qatar Industrial Development Bank (QIDB) – the Qatar-German Medical De-vices Company.”

Qatar German Medical Devices was a

prole studied by GOIC and QIDB cameforward to carry it out to implement it.

“We have several contacts with inter-national technology holders throughwhich we evaluate the technology, assessthe market and see who is interested intaking it forward. When QIDB pickedthe project they sought our help to evalu-ate it further. We conduct seminars andinvestment meets to explore more op-portunities. Approximately 50 percent of what we study and put forward is imple-mented. It takes a while to establish anindustrial unit about 2-2.5 years.”

While GOIC’s primary role is to gen-erate investment ideas, it is often beingcalled on to carry further studies, imple-ment projects and conduct third party as-sessments.

“It depends on the investor. The inves-tor may not even contact the same thetechnology holder with whom we havestudied the prole. Based on these pro-les the investor knows there is a marketfor its products and he may contact othertechnology holders and implement theproject with.”

GOIC’s advantage over private con-sultants is that “we have informationprivilege. Our access to data is much bet-ter. We do not operate as a private con-sultant, but we do some consultanciesoriented towards the private sector likerestructuring of rms, industrial assess-ments, energy efciency of industrial es-tablishments, environmental assessment.But it’s not a large proportion of our

work, as we have a lot of requests fromthe Governments and Ministries.”The main goal of GCC countries is

diversication – away from wholly de-pending on hydrocarbon resources andtowards manufacturing. “GOIC was setup in an era when there was a boom inoil prices, and then a bust occurred. Thestates conceived that they needed a tech-nical agency to create awareness andgive advice to policy makers in this re-gard. What we have been doing recentlyis also policy advice on economic agree-ments, anti-dumping regulations in theGCC for example...that is at the macro

GOIC plans SPX satellite units,wider databases to attract FDIy Vani Saraswathi

mPromotion o 330 investment opptunities in a various sectors, throu23 investment seminars held in dieent locations in the GCC countrieThey entail a capital investment about $ 6.6 billion and create abo16000 new jobs.

m More than 150 techno-economeasibility studies have been undetaken, mainly in Chemicals and Perochemicals, Metals, EngineerinBuilding Materials and Food Sector

m Implementing o more than 1consultancy studies in the felds

planning and ollow up, investmeopportunities, evaluation, operatappraisal and industrial legislation.

m Development o data bases socio-economic, industrial and eign trade data and statistics. Direon line access to these databasesprovided to all the GCC MinistriesIndustry.

m Establishing the frst GCC SPX thprovides technical inormation matchmaking between main contrators and subcontractors.

GOIC’s achievements

since its foundation are:

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Qatar Today December 200544

F o c u s

common GCC free zone, Dr Al Misnedsaid, “A single free zone is not somethingthat can happen overnight. Existing freezones are important to these countries.In addition, you see most of the GCCcountries in any case have minimal taxa-tion and tariffs are low, so why would

they want free zones anyway? Becausethere are some administrative restric-tions that are, time consuming, so thesefree zones make processes quicker. Theywant to create a good environment forcompanies to come in. It is a good idea asit accelerates the pace of liberalising thewhole economy. Even in one country youcan have different free zones, and formclusters.”

Will the lack of ready cheap labour be adeterrent to FDI? “In terms of scarcity of labour, we have a long historical relation-

ship with the sub-continent and Asiancountries. The Gulf countries have been  built on expatriate labour that is avail-able here as it is in, say India. That is notan issue. And there are other incentivessuch as energy, free zones, less taxation,good infrastructure...”

Diversication has also caught the fan-cy of traditional family businesses. “Overthe last 20 years, GCC has built a genera-tion of industrialists. Not in the volume,we wished. However, there is a founda-tion and the culture has enhanced in thelast few years, and people are lookingat diversication. Family businesses arelaunching IPOs, looking at more capital,and different investment options.”

On reports of some family businesseshad stretched themselves too far andwere now in the red, she said, that thereis a trend now where the rst generationof businessmen – who established thecompanies – are being phased out and anew generation was taking over with dif-ferent ideas and vision. “Sometimes it is better to y outside the family businessand look at expansion. This trend will

continue, and it is positive.”On the Gulf currencies being pegged to

the US dollar, she said “to reduce shocksof exchange rate uctuation currenciesneed to be pegged to a basket of curren-cies. On the GCC union, Dr Misned said,“The political leadership has initiatedthe custom union, and there should be acommon monetary unity in 2010. It willhelp the region on the road to economicunity. There are some benets and someconstraints. But we need to look at thenet gain. Short term losses are necessary

for long term benets.”