Doha: With proper implementation of a circular economy (CE), Qatar is set to generate an additional $17bn by 2030, corresponding to 10 percent of its GDP, as well as create an estimated 9,000-19,000 jobs by 2030, increase disposable income, and attract more greenfield foreign direct investment (FDI), according to the Investment Promotion Agency Qatar (IPA Qatar). In its policy paper on Circular Economy published recently, IPA Qatar highlighted that as the world gravitates towards sustainable investing, a circular model helps countries like Qatar achieve a balance between economic growth and environmental stewardship.
Investors worldwide are becoming sustainability-conscious, which has partially motivated many countries to implement circular strategies to attract greenfield FDI and create quality jobs for their citizens. Therefore, targeting sustainability-conscious investors is crucial for achieving economic, social, and environmental objectives set by the Qatar National Vision 2030, said IPA Qatar.
In the study, IPA Qatar noted that the current pandemic has expedited the shift towards CE by bringing to the fore many of the inherent risks and dysfunctionalities of the linear economy. In June 2020, more than 50 global leaders and chief executives endorsed the circular model as a viable solution to build back better and achieve green and sustainable recovery from the COVID-19 crisis. As a result, since the beginning of the pandemic, assets in public equity funds with a CE focus have increased from $300m to over $2bn, a sixfold jump.
In Qatar, the building blocks of CE are already in place, said IPA Qatar in the study. It added that Qatar’s efforts to transition to a more sustainable model stem from the country’s National Vision 2030 and include climate change strategy, green cities, and national targets for resource efficiency and waste management. Taken together, these place Qatar in an excellent position to further advance its work on resource efficiency and the CE.
“Furthermore, ongoing sustainability projects with guidance from QNV2030, such as hosting the first carbon-neutral FIFA World Cup ever in 2022, are clear manifestations of the government’s commitment to maintaining harmony between economic development and environmental sustainability. The national climate change strategy also aims to reduce the carbon intensity of the liquefied natural gas facilities by 25 percent the same year. And as the world’s largest liquefied natural gas producer, Qatar also plans to expand LNG production to 126 million tonnes annually by the end of 2027. LNG production helps countries shift from other high-polluting fuels like coal and oil to meet carbon emission targets,” IPA Qatar added.
Circular economy is a trillion-dollar opportunity with great potential for job creation, economic growth, and innovation. Globally, CE can generate $4.5 trillion of additional economic output by 2030 and as much as $25 trillion by 2050. At a regional level, the GCC can save up to $138bn by 2030 with the circular model, equivalent to almost 1 percent of the region’s total GDP between 2020 and 2030.
“The most circular economies stand to reap the most benefits by boosting their competitiveness, resilience, and innovative capabilities. CE also promotes economic diversification by facilitating private sector expansion by developing circular sectors and activities such as logistics, service economy, manufacturing, and advanced recycling. Furthermore, as sustainability becomes a high priority worldwide and businesses face an increasing ESG scrutiny, countries that promote circular policies through economic and regulatory instruments are 10-40 percent more likely to attract greenfield FDI. Thus, Qatar will be well-positioned to capture these economic prizes by moving towards circularity,” said IPA Qatar.
Sustainable development is becoming a determining factor of IPAs sector promotion and FDI targeting strategies worldwide. IPA Qatar, which was established to play a vital role in accelerating the economic development of Qatar, reiterated that it pursues targeted, sector-specific investment promotion strategies with a firm focus on sustainable investing, while showcasing opportunities in promising sectors here that could catalyse the sustainable transition process.