Doha – In the face of expectations of a global inflation wave that may lead to a new financial crisis, Qatari officials have broadcast messages of reassurance about the investment situation in the State of Qatar and the stability of its banking system.
The chief executive of the Qatar Investment Authority, Mansour Ibrahim Al Mahmoud, and the governor of the Qatar Central Bank, Sheikh Abdullah bin Saud Al Thani, agreed that the inflation wave would be temporary and not prolonged. Read also Qatar Economic Forum discusses the reality of digital currencies in the world and its future Qatar Economic Forum highlights the experiences of Qatar, Turkey and Britain under Corona ظل Qatar Economic Forum discusses the shock of the accelerating digital transformations imposed by the Corona pandemic Qatar Economic Forum
These estimates came as part of the activities of the third day of the Qatar Economic Forum, in cooperation with the Bloomberg Network, held remotely, where the two Qatari officials reviewed – in two separate interventions – Qatar’s strategy in investment and in strengthening its financial system by facing the new challenges imposed by the Corona epidemic on the world.
epidemic and investment
Despite the effects of the pandemic on global investments, the head of the Qatar Investment Authority stressed that the philosophy of his institution has not changed, and is based on 3 pillars: investing in the long term, investing with clear goals, and then diversifying investments.
Al Mahmoud said that the Qatar Investment Authority is constantly studying and analyzing the changes taking place in the market after the pandemic, and knowing future economic trends for the purpose of investing in promising opportunities, adding, “For example, we have invested heavily in the technology sector and the field of distance education.”
According to Al Mahmoud, it is not necessary to consider any sector in its entirety to judge its performance, but the financial and investment analysis should be based on a specific reading of one of these branches.
He gave an example of investing in the real estate sector, and said, “During the epidemic and after it, there are fields that know a great development, such as warehouses for e-commerce and data centers, which are considered among the promising sectors.”
The Qatari official presented an example of the diversification of the investment portfolio of the State of Qatar, which has invested more than ever in the technology and health sectors in the past two years, in order to diversify its portfolio, and also to take advantage of the opportunities offered by the market. “The investment sector believes in diversity and maintaining balance, and whenever there are good opportunities, we will invest in them,” he said.
The Qatari economic official expressed his satisfaction with the results of investments in both Asia and America, and said that they are “going well and amazingly,” and he has no concern about the threats of a trade war between the United States and China, because he believes that the two countries are able to reach an agreement “although the negotiations between them lasted more than two years.” too much.”
The CEO of the Qatar Investment Authority does not see any danger from a new global inflation wave, expecting that “inflation will occur in the short term, but it is not a cause for concern and will be temporary.” He estimated that this problem would not pose a threat to the Qatari economy or its investment apparatus.
Qatar Central Bank Governor Sheikh Abdullah bin Saud Al Thani agrees with the head of the Investment Authority that the inflation wave will not be long-term or have a significant impact on the global economy.
Al-Thani attributed this to the rapid recovery after the pandemic thanks to vaccinations, higher public spending and increased global demand, and said that “all of this may lead to temporary inflation, but not in the long term.”
On the other hand, he warned of a “worrying” situation with regard to the low interest rate during the past decade, and said that this might prompt investment in high-risk fields without cautions or precautions due to low interest rates.
Sheikh Abdullah bin Saud Al Thani denied that his country had any intention of making changes to its financial system, especially with the state of economic recovery and the growth of the gross domestic product, which he expected to record positive numbers this year.
Al-Thani said, “We were expecting the price of a barrel to reach 40 dollars, but it recorded 46 dollars, and we hope that it will settle on that until the end of the year.”
According to the Governor of the Qatar Central Bank, the fixed exchange rate system constitutes an added value to Qatar’s economy and financial system, keeps it away from many risks, and makes it more capable of dealing with sudden shocks, as happened during the epidemic.
As for digital and encrypted currencies, Al-Thani said that the Qatar Central Bank has a clear strategy in dealing with these currencies, adding that “this issue still needs a lot of work and the development of a legislative framework for it, and we in the Central Bank our mission is the safety and security of performance systems that It has to be strong, transparent and clear to investors.”
Transfer investment interests
In a speech during his participation in the Qatar Forum, the CEO of “Black Stone” Investments Corporation, Stephen Schwarzman, acknowledged the impact of the Corona pandemic – significantly – on investments, their trends and their reflection on investment interest from the hotel sector to technology and health.
Schwarzman said that all economic sectors faced great challenges, “and whoever was able to adapt quickly to the new situation is the one who will emerge quickly from this crisis.” He alluded to his institution’s new orientations to invest heavily in the technology sector, research and clean energies, “because they are the sectors of the future.”
Schwarzman makes no secret of his caution and apprehension about unprecedented public spending in the United States. He said, “It is true that it achieves a reasonable growth rate, but it will also lead to an inflation rate that may reach 8%.” Then he reassured that inflation, although it will be the highest in decades, “will not last long because developments in the global market are so fast that it cannot be absorbed.”