EXPLAINER: Qatar’s vast wealth helps it host the FIFA World Cup

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DUBAI, United Arab Emirates (AP) — Qatar is home to some 2.9 million people, but only a small fraction — about one in 10 — are Qatari citizens. They enjoy massive wealth and benefits fueled by Qatar’s shared control of one of the largest natural gas reserves in the world.

The small country located at the eastern end of the Arabian Peninsula juts into the Persian Gulf. There is the North Field, the largest underwater gas field in the world, which Qatar shares with Iran. The gas field holds about 10% of the world’s known natural gas reserves.

Oil and gas made the 50-year-old country incredibly rich and influential. Within a few decades, Qatar’s approximately 300,000 citizens were removed from the hard livelihood of fishing and pearl fishing.

The country is now a international transit hub with a profitable national airlinea force behind influential news network Al Jazeera and pays for the expansion of the largest US military base in the Middle East.

Here’s a look at Qatar’s economy and how the tiny country was able to spend so much to host the FIFA World Cup:

THE ECONOMIC STRENGTH OF QATAR

For most of its existence, the tribes of Qatar have relied on diving and pearl fishing for their survival. Like other parts of the gulf, it was a harsh, bare existence. The discovery of oil and gas in the mid-twentieth century forever changed life on the Arabian Peninsula.

While much of the world grapples with recession and inflation, Qatar and other Arab Gulf energy producers are reaping the benefits of high energy prices. The International Monetary Fund expects Qatar’s economy to grow by around 3.4% this year.

Despite going on a massive spending spree to prepare for the World Cup, the country still earned more than it spent last year, giving it a comfortable surplus that will carry over into 2022. Qatar’s wealth is expected to increase as it expands its capacity to be able to export more. natural gas by 2025.

Its sovereign wealth fund, the Qatar Investment Authority, manages and invests the country’s financial reserves.

WORLD CUP SPENDING IN QATAR

Qatar has spent some $200 billion on infrastructure and other development projects since winning the bid to host the five-week World Cup, according to official statements and a Deloitte report.

Around $6.5 billion was spent building eight stadiums for the tournament, including the Al Janoub Stadium designed by the late acclaimed architect Zaha Hadid.

Billions have also been spent to build a metro line, a new airport, roads and other infrastructure ahead of matches.

London-based research firm Capital Economics said ticket sales suggest around 1.5 million tourists will travel to Qatar for the World Cup. If each visitor stayed 10 days and spent $500 per day, spending per visitor would be $5,000, the research firm said. That could represent a $7.5 billion boost to Qatar’s economy this year. However, some fans may fly just for matches while staying in close to Dubai and beyond.

THE BENEFITS OF QATAR

Like other oil-rich Gulf states, Qatar is not a democracy. Decisions are made by the ruling Al Thani family and their chosen advisors. Citizens have little to say about the major political decisions of their country.

The government, however, provides citizens with vast benefits that have helped ensure continued loyalty and support. Qatari citizens enjoy tax-free income, well-paying government jobs, free health care, free higher education, financial support for newlyweds, housing assistance, generous subsidies that cover utility bills and lavish retirement benefits.

The country’s citizens rely on laborers from other countries to fill service-sector jobs, such as drivers and nannies, and to do the tough construction work that has built the Qatar of today.

QATAR’S MIGRANT WORKFORCE

The country has comes under scrutiny for its labor laws and the treatment of hundreds of thousands of migrant workers, mainly from India, Bangladesh, Pakistan, Sri Lanka, Nepal and other South Asian countries. These men live in shared rooms in labor camps and work through the long summer months, with only a few hours off at noon. They often spend years without seeing their families back home.

The work is often dangerous, with Amnesty International saying dozens of people may have died from apparent heatstroke.

Rights groups have credited Qatar with improving its labor laws, such as adopting a minimum monthly wage of around $275 in 2020, and for dismantling of the “kafala” system which prevented workers from changing jobs or leaving the country without the consent of their employers.

However, Human Rights Watch has urged Qatar to improve compensation for migrant workers who suffered injuries, deaths and wage theft while working on World Cup-related projects.

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Follow Aya Batrawy on Twitter at www.twitter.com/ayaelb.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

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