黑洞社区

Doha is a city of flash cars, jet-skiing sheikhs, lavish all-day brunches at grand hotels and glistening towers. And it is also a city of forced labour, shanty accommodation crammed with migrants, back-breaking construction work and human rights abuses. Then every shade in between.

Qatar shot to prominence when, a year after gaining independence from the British Empire, it discovered the world鈥檚 largest gas field in 1972, propelling it from quaint obscurity to the frontline of the Middle Eastern energy boom. Its population has also ballooned from 100,000 in 1970 to over 2.2 million.

Yet many people have only heard of Qatar today because it sensationally won the right to host the 2022 football World Cup. It begged the question - how could such a tiny country, with virtually no history of the game, a chequered human rights record, and intolerable summer temperatures of 50掳C-plus pull off such a feat? The improbable result helped spark corruption investigations into football governing body FIFA by British newspapers, Swiss prosecutors and the FBI. Yet despite a whirl of allegations against Qatar鈥檚 World Cup bid, ultimately it was unrelated historic misdemeanours that claimed the jobs of football bosses Sepp Blatter and Michel Platini. Meanwhile, Qatar retained the tournament, like a skilled footballer keeping the ball through a flurry of tackles.

But in the UK it seems public opinion is already set - Qatar is the bewildering, almost ridiculous host of the world鈥檚 best-loved sporting tournament. And, what鈥檚 worse, it鈥檚 widely presumed hundreds of migrant workers will die building the stadiums where it will be played, despite there being no reported deaths on World Cup projects to date.

Without apologising for Qatar - its problems are indeed many and varied - there is inevitably more to the country than this. 黑洞社区 has visited Qatar twice in 18 months to cover preparations for the World Cup and to find out what construction professionals make of life in one of the world鈥檚 fastest-growing countries.

Because for Qatar鈥檚 construction market, it鈥檚 crunch time. The country has barely begun constructing the 拢3bn-worth of World Cup stadiums needed, and other hugely ambitious projects are in the pipeline, from completing Doha鈥檚 232km new metro system to delivering the $45bn city district of Lusail, the planned backdrop for the World Cup final. All this when Qatar, like its Gulf neighbours, has been rocked by the global slump in oil and gas prices, forcing it to rein in spending and axe some projects. Many UK firms have carved out success in Qatar - including Zaha Hadid Architects, Arup and Interserve - but some have come and gone, such as Gardiner & Theobald, Laing O鈥橰ourke and Galliford Try. The Brits still in Qatar readily admit it is no cakewalk.

So in the face of its challenges is Qatar likely to be ready to host the 2022 World Cup? And how are UK firms withstanding the heat in this ultra-competitive market?

黑洞社区 towards 2022

Qataris balk at any attempt to reduce their country鈥檚 ambitions to hosting a single tournament, and rightly so. The country is also investing heavily in other areas of its economy, including education, healthcare, manufacturing and services. It also has big cultural ambitions, with majestic new museums like the Jean Nouvel-designed National Museum, inspired by the scattered petals of a desert rose, taking shape in the city. It may not be a tourist hotspot now, but parts of Doha are also surprisingly vibrant, with a cosmopolitan food and art scene in the bustling, rebuilt old town souk. The Qatar National Vision strategy sets out an ambition to establish an economy no longer dependant on oil and gas exports by 2030.

Nonetheless experts predict the World Cup will be the biggest driver of Qatar鈥檚 construction sector over the coming years, whether it be stadiums or the supporting infrastructure necessary to host the tournament. That includes roads, metro links, airport expansion, port expansion and 鈥渙verlay鈥� work like fan zones, media facilities and security. Global Construction Perspectives and Oxford Economics forecast Qatar鈥檚 construction sector will grow by an average of 12.1% per year up to 2020 as a lot of this World Cup-related work is delivered, before slowing to 3% per year over the first half of the 2020s and to 0.7% per year thereafter. By 2030 the Qatari construction sector will be worth 拢44bn, more than double its value of 拢20bn in 2014.

Despite these strong forecasts, many firms on the ground point to a significant slowdown in Qatar in recent months due to the oil and gas price slump. Many UK firms have established a presence in Qatar, not least British consultants and architects, who arguably out-punch any other foreign nation - Foster + Partners, Zaha Hadid Architects, Mace, Gleeds, Rider Levett Bucknall (RLB), Turner & Townsend, Arup and Hilson Moran are among them - while the two chief British contractors are Interserve and Carillion. Also, the UK businesses of major international firms like CH2M, Aecom and Arcadis have a presence in Qatar. Both Brits and non-Brits say the market is proving tough at the moment. Not all are willing to speak on the record, citing Qatari client sensitivity to the press.

鈥淚t鈥檚 a tricky market at the moment,鈥� one Brit tells 黑洞社区. 鈥淚t was an architects鈥� playground at one point, but now there are massive cutbacks.鈥� A consultant concurs: 鈥淢ost budgets have been reviewed. There are not enough projects around for the number of consultants and I don鈥檛 see much movement for another 12 months.鈥�

Some firms can see the positive side of the slowdown as Qatar has been given a reality check. 鈥淨atari clients are taking a long hard look at what they鈥檙e investing in and why,鈥� says Sam Graham, Qatar-based director at RLB. 鈥淭hey鈥檙e focusing on those that provide some kind of economic payback going forward.鈥� There鈥檚 also now talk of Qatar diversifying its income by introducing taxes such as VAT for the first time and exploring funding options like public private partnerships.

The consensus is that the slowdown has hit mid-size projects hardest. Few believe the country鈥檚 ability to host the 2022 World Cup has been threatened, although there are serious question marks over aspects of the plans. Nonetheless, when it comes to the actual World Cup programme, some are concerned that despite Qatar鈥檚 best intentions to be a good client, its inexperience could be costly.

鈥淨atar is in the process of procuring an infrastructure programme worth in excess of $250bn. There is massive ambition to deliver this successfully but few countries have experienced such a pace of change and sometimes lack of client procurement experience can lead to delays and uncertainty,鈥� says one source. 鈥淭he programme鈥檚 got to accelerate or we鈥檒l have too much happening at the same time. Energy prices are causing a pause and if it persists there鈥檚 going to be a mad rush to meet World Cup deadlines. In turn that could stoke construction cost inflation.鈥�

Withstanding the heat

While there are lots of exciting work opportunities in Qatar, there are also a lot of potential pitfalls. Finding a suitable local partner, the long slog of getting established, and managing risk on hellishly onerous contracts are just some of the challenges.

Picking the right local partner is cited as key by many working in Qatar. While it is possible to work on individual projects without incorporating in Qatar, it is highly recommended for anyone serious about getting established. All companies in Qatar have to be majority owned by a Qatari, so typically the ownership is split 51:49, with the international firm taking the smaller share. Some Qataris鈥� involvement is limited to just that, and perhaps their name on a plaque in the office.

But some Brits cannot sing the praises of their Qatari partner enough. One British firm says: 鈥淎n active partner is essential. It鈥檚 effective when you need it - if you need visas speeding up, or ports unblocking, or to get through some bureaucracy.鈥� The Qatari government is effectively run by an opaque network of families and connections, ultimately led by the ruling Al Thani family, and it pays to partner with someone as high up the food chain as possible.

But, once you鈥檙e set up, don鈥檛 expect quick results. 鈥淭here鈥檚 still a lot of the 鈥榝ly in and fly out鈥� approach but that never works,鈥� says Matthew Kitson, Qatar regional director at Hilson Moran. 鈥淵ou need to fully commit. People often expect to get results within six months, but it can take a year or more.鈥�

A further potential barrier to entry is the Qataris鈥� renewed enthusiasm for applying a long-standing law which requires all construction firms to be 鈥淕rade A鈥� qualified to work on public projects, a qualification that can take two years to obtain based on a range of financial and technical criteria.

The contracts in Qatar can be horrendous. As one market source puts it: 鈥淭hey are not transparent, variations are not permissible, it鈥檚 a fixed price, there are punitive liquidated damages and massive liabilities.鈥�

Take it from a lawyer, Pinsent Mason鈥檚 Peter Blackmore: 鈥淚 think a lot of contractors new to this market underestimate the contracts and are naive in relation to change and the claims process. Consequently on project after project in Qatar there are unresolved issues around claims on scope.鈥�

But for those who persevere, many ex-pats are enjoying life in Qatar. 鈥淭he culture is good, the Qataris have a lot of respect for people and families,鈥� says Hilson Moran鈥檚 Kitson. 鈥淚t鈥檚 an exciting challenge professionally and it鈥檚 a great life for me and my family.鈥� Meanwhile, Gleeds鈥� associate director Grant McIntosh鈥檚 advice is to come to Qatar with an open mind. 鈥淟eave everything you know at Heathrow Airport. Come here with a blank canvas. Embrace the traditions and learn how things work. If you come with preconceptions you鈥檒l fail.鈥�