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protecting brands qatar success story
market research qe venture market intellectual property
taxation
MAY 2012
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w.privatesectorqatar.com
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News10 UPDATESGet to know about the latest events and happenings in Qatar that will have an impact on SMEs and large enterprises.
Success Story28 MAKING EXCELLENCE A HABITSheikh Naif Bin-Ali-Al-Thani, Chairman, National Group, talks to us about his journey and what are his plans for the future.
SMEs22 WALK THE TALK: PROMOTING SMES Mouyaed Makhlouf, Regional Director, MENA, IFC talks to Private Sector about their work in the region and what programmes they have to encourage SMEs.
26 WHAT IS YOUR STYLE?Elias Mazzawi, Managing Director, EMS MENA, highlights the important points for managing an SME.
ManagementShelf Life14 PRODUCTSTake a look at the new launches that make your work life easier. It’s not like you need an excuse!
30 LENDING A HANDAparna Shivpuri Arya caught up with Colin Milton, Deputy Director, Listings Department, Qatar Exchange, to know about their latest initiative, QE Venture Market, for SMEs.
Investment
32 BEYOND THE DROP The Qatar National Vision 2030 aims at enhancing the role of the private sector in the economy. Howard Kitson, Country Head, Mashreq-Qatar tell us about the country’s efforts to promote SMEs as part of the national vision.
Business Growth
SMEs16 THE ONE STOP SHOPQatar Development Bank (QDB) launched it’s SME Toolkit to help and promote entrepreneurs and startups in Qatar. We bring you a snapshot of the event.
Business setup36 KNOW YOUR NEIGHBOURHOODBefore setting up a business, it is important to match your expectations with what the demands of the targeted market are. Bedaya Centre tells us how to go about with your market research.
SME Toolkit
16
contentsMay 2012
38 GET READY FOR THE MARKET How do you know that your CV caters to the expectations of the job market? Elsbeth Blekkenhorst and Danielle Maynard-Duttenhofer, Founders, Global Women Qatar, explain to us how to get our CV in order for the Qatar market.
Human Resource
Entrepreneurs34 REWARDING SUCCESSEnterprise Qatar (EQ) hosted the EO Majlis and the Ernest & Young Entrepreneur Award 2011. We bring you highlights of both these events.
36
48
42
Legal40 PROTECTING WHAT’S YOURSIn the last decade, Qatar has made real progress towards putting in place regulations for intellectual property. David Harper, Associate, Clyde &Co, explains to us the importance of Trademarks for business.
48 ECONOMIC LANDSCAPE Qatar has prospered in the last several years and held its own during the tumultuous times in the region. We take a look at consumer confidence in the country.
Country Update
Industry Watch54 WINDS OF CHANGEThe Arab Spring has affected a lot of economies in the region but has also given rise to the entrepreneurial spirit of the region.
Tax44 GET THE NUMBERS RIGHTWhat does the new tax law (Law No.21 of 2009) mean for SMEs? Paul Smith, Partner, Price WaterHouse Cooper, answers some of the key questions.
Marketing42 ON YOUR MARKSFollowing up our previous article on Trademarks, Mark Hill and Fiona Robertson, Media Lawyers, therightslawyers, talk about creating and protecting brands.
About town52 FOSTERING INCLUSIvE DEvELOPMENT Qatar recently hosted the UNCTAD XIII, where discussions were held on various aspects of development. Private Sector brings you the highlights from the international event.
April was a busy month for us, with events galore and the usual editorial deadlines. But we are here again, with another issue, filled with interesting discussions and informative articles on various aspects of doing business in Qatar.
Last month, QDB launched its SME Toolkit, supported by IFC and powered by IBM. It was an engaging event with panel discussions and presentations. The event was packed with enthusiastic entrepreneurs and businessmen, wanting to know how they can leverage from the
toolkit. We had even set up laptops outside for people to get a feel of the toolkit. The panel discussion had experts from all fields, who gave advice on how to start and manage a business. With 90% of enterprises in the region being SMEs, there couldn’t be a better time to start this initiative. The toolkit provides information right from the business idea to the management stage.
The other big event last month was of course the UNCTAD XIII and the World Investment Forum. The theme of the thirteenth session was Development-centred globalisation: Towards inclusive and sustainable growth and development. This fits perfectly with Qatar’s vision and the country was also handed over the presidency of UNCTAD for the next four years- a first for the Arab region!
Keeping up with the theme, we saw panel discussions on women development, technology, international trade, investment and much more.
Moving on, we also got talking to the Chairman of the National Group to know about his journey and what is his mantra for success. We also bring you a detailed article on the taxation system in Qatar and what do SMEs need to take notice of. Carrying forward our agenda to support SMEs, we met up with Qatar Exchange to know about their new initiative for SMEs. And if you are looking for a job and a little lost on how to prepare your CV, don’t forget to read our article by Global Women Qatar.
Like I said earlier, there will never be a better time to be an entrepreneur or startup in Qatar. So jump on the bandwagon !
We hope you will enjoy the read and soon we’ll be expanding our team! You’ll get to meet them in our next issue.
So keep reading!
editorial
Join the ride
Aparna Shivpuri Arya, Editor (English), Private Sector Qatar
Talk to us:E-mail: aparna@cpidubai.com Twitter: @PrivateSectorQA Facebook: www.facebook.com/PrivateSectorQatarLinkedIn group: Private Sector Qatar
PublisherDominic De Sousa
Group COONadeem Hood
Managing DirectorRichard Judd
richard@cpidubai.com +971 4 440 9126
EDITORIAL
Editor - EnglishAparna Shivpuri Arya
aparna@cpidubai.com +971 440 9133
Editor - ArabicBasel Al Bannoud
basel@cpidubai.com +971 440 9140
Contributing EditorsMike Byrne
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ADVERTISING
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OPERATIONS AND DESIGN
Operations DirectorJames Rawlins
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Art DirectorKamil Roxas
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DIGITAL SERVICESwww.smeadvisor.com
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QDB BriDgeD the gap to starting my own Business through aL Dhameen.
Do you have a promising business or new business idea? But do you also have trouble finding the funding that you need? Ask us about Al Dhameen Indirect Lending Program from QDB. We will guarantee up to 85% of your business loan*, leaving you free to focus on developing your business. Click on www.qdb.qa or visit one of our partners listed below.
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QDB_Al_Dhameen_Bridge_270x207mm.indd 1 24.01.12 16:29
For more information, please visit www.privatesectorqatar.com/en
Dr. Hessa Al Jaber
Dr. Jaber is the Secretary General of ictQATAR.
Abdulaziz N. Al-Khalifa
Mr. Al-Khalifa is the Executive Director, Strategic Planning and Control at Qatar Development Bank (QDB).
Raed Al-Emadi
Mr. Al-Emadi is the Deputy CEO, Silatech.
Bassam Salman
Mr. Salman is Executive Assistant, Qatar Chamber of Commerce & Industry.
George M. White, Ph.D.
Dr. White is Associate Teaching Professor of Entrepreneurship at Carnegie Mellon University-Qatar.
Hamad Mohammed Al-Kuwari
Hamad AL-Kuwari is the Managing Director of Qatar Science & Technology Park.
Ms. Amal Al-Mannai
Ms. Al-Mannai is the Executive Director of the Social Development Center (SDC).
Hamad Al Abdan Al-Marri
Eng. Hamad Mohamed Al Abdan is the Chief Business Operation Officer at Enterprise Qatar.
Professor Nitham M. Hindi
Professor Nitham M. Hindi, is the Dean of College of Business and Economics at the Qatar University.
Gail Gosse
Gail Gosse, is the Dean of the School of Business at College of North Atlantic-Qatar.
AdvISoRy BoARd
13 major Qatar plastic companies participate in NPE 2012 USA
Under the auspices & organisation of TASDEER, the exporting arm of Qatar Development Bank (QDB), 13 major Qatar companies took part in the exhibition “Plastic Industry 2012” in the United States, Conference Center in Orlando, Florida, from 1-5 April.
The Bank through TASDEER bore all expenses and the financial cost to all 13 companies, under the QDB pavilion. Commenting on this occasion, Mr. Mansoor Bin Ibrahim Al-Mahmoud, CEO of QDB said that the participation of 13 Qatari companies representing different sectors of the plastics industries, reflect the importance of this sector to the national economy diversified away from energy products.
Meanwhile, Mr. Hassan Khalifa Al Mansouri – Executive Director of Tasdeer – Qatar Export Development Agency at Qatar Development Bank said that NPE 2012 is one of the most important events dedicated to the plastic industry and is aimed at discovering new plastic manufacturing technologies. He went on say that the event offers unrivalled process innovations to help automotive component manufacturers’ rise up to face the modern day challenges that lie ahead of them.
He assured that NPE 2012 featured the full stream of assembly technology products for all manufacturing processes. Apart from this, it is the center for business networking, the source of knowledge, the
meeting place for industrialists to share ideas and comments as well as a stage for the newcomers from Qatar’s academic institutions to debut their performances in technologies.
“The main objective of these companies from Qatar in the NPE 2012 was to develop the nation’s manufacturing industry with special attention given to the Small and Medium Industry (SMIs) to further develop and keep ahead with the competitive environment. The event showcased latest innovation and products for related industry which attracted thousands of visitors from different parts of the worlds,” Al Mansouri added.
news
10 may 2012
Qatar’s GDP set to grow
Challenge of inclusive growth ahead of UNCTAD XIII
QNB Group has updated its forecasts for the Qatari economy for the period 2012-13, based on the recent release of full year 2011 GDP data by Qatar Statistics Authority. The update includes various oil price scenarios. Nominal GDP is forecast to surge by 19.8% in 2012 and rise by a further 5.4% in 2013 to QR 798bn as the non-hydrocarbons sector takes over from hydrocarbons sector as the main driver of growth.
The baseline forecasts assume that oil prices will average USD 120 per barrel in both 2012 and 2013. Qatari crude oil prices have averaged USD 119/barrel for the first quarter of 2012, with an average of USD 125/barrel in March 2012.
Given recent oil price volatility, it is important to consider the impact on our forecasts of various oil price scenarios. If the oil price in 2013 were to fall below to USD 110/barrel, then GDP would
contract by 1.3%. Conversely, if oil prices rose from USD 120/barrel in 2012 to USD 130/barrel in 2013, then Qatar’s nominal GDP would grow by about 12.2%, more than double the baseline growth forecast, which assumes prices average USD 120/barrel in 2012-13.
In its baseline scenario, QNB Group expects that hydrocarbon GDP will represent 59% of total GDP in 2012, compared to 58% in 2011 due to higher prices and increases in output. In 2013, the share of hydrocarbon GDP will fall back to 58% as QNB Group expects hydrocarbon prices and production to level off while the non-hydrocarbon sector grows strongly.
In the non-hydrocarbon sector, QNB Group forecasts growth of 15.4% in 2012 and 8.9% in 2013, with the corresponding values of QR308bn and QR333bn.
The sectors with the highest contribution to non-hydrocarbon GDP are financial services, representing 26% in 2012, followed by government services and manufacturing, both with 22%.
QNB Group expects government services to grow by
37% in 2012 reaching QR 67bn, mainly due to salary increases for Qatari government employees.
Based on QNB Group’s baseline forecasts for 2012 and 2013, GDP per capita will be USD 112,929 and USD 114,340 respectively, which will rank Qatar as the richest country in the world.
The United Nations Development Programme (UNDP) has highlighted inclusive growth as a challenge to equitable globalisation, ahead of the thirteenth session of the United Nations Conference on Trade and Development (UNCTAD XIII). As the host and President of UNCTAD, Qatar has the opportunity over the
next four years to ensure that human development indicators of developing countries are converging faster with those of the industrialized world.
Ahead of UNCTAD XIII, the UNDP Administrator Helen Clark sent a message to the conference stating,
“Economic growth needs to be inclusive and equitable to enhance resilience to crises and reduce poverty and inequality. Growth needs to occur in the sectors where the world’s poor are trying to make their living, like agriculture, and employment creation needs to fit the definition of decent work.”
news
631
19.8%
5.6%
42%
58%
41%
59%
42%
58%
756
798
11may 2012
Save the date!date Event Location7-8 may 2nd annual mep summit and awards intercontinental hotel, doha
10 may made in italy 2012 doha exhibition center
10-16 may spe international production and operations conference and exhibition (poce)
qatar national convention centre (qncc), doha
21-22 may qatar construction logistics tba
22-24 may international exhibition of toys doha exhibition center
23-25 may cityscape qatar qatar international exhibition centre
24-26 may mother, baby and kids show doha exhibition center
27-30 may Fttx summit middle east oryx rotana hotel, doha
28-29 may the 2nd middle east sme Forum 2012 grand hyatt, doha
2 June "hya" abaya exhibition June 2012 doha exhibition centre
3-7 June world stadium congress 2012 tba
news
MAy-JUNE 2012
Business funding clinicsBedaya Center for Entrepreneurship
and Career Development successfully ran their first business funding clinic at their premises in Katara. The clinics target entrepreneurs at all stages of their business, whether they just have an idea and require feedback or are at a more mature stage of their business and require advice on funding and setting up their company. The clinics are one to one sessions where entrepreneurs can:• Discuss their business confidentially• Ascertain whether they are ready to go
through the investment process• Get advice on how to get investment
ready• Find out about additional support
available
In their first week they met with nine entrepreneurs who were a combination of established and first time entrepreneurs. Their businesses covered a range of areas including technologies, lifestyle, retail, construction and marketing. Although the entrepreneurs had many questions on the legal requirements to setup a company in Qatar as well as funding options available, the majority of them used the sessions as a sounding board for their business idea, discussing whether their proposition is business viable in the region.
At the end of each session, the advisor sets out an action plan with the entrepreneur which includes identifying improvement areas either for the individual
(presentation skills, communication skills, Investment awareness and readiness and so forth) or their business (build the business model, conduct market analysis and so forth). In some cases businesses would be at an investment funding stage and we would then shortlist them to pitch in front of investors in our business funding events. Out of the nine people they met, three of them have been shortlisted to pitch.
The business funding clinics are free sessions run on Monday mornings between 8 AM and 12:30 PM and Tuesday afternoons between 4 PM and 6 PM at thirty minute slots per session. To book slots please email business advisor Yasmeen Hasan at Yasmeen@bedaya.qa.
12 may 2012
shelF liFe
Be everywhereMotorola Solutions, Inc. announced the availability in Europe, Middle East and Africa region of the rugged DS3500-ER series of extended range scanners offering the flexibility to easily scan and capture barcode information from both near and extended distances for warehouse management and other applications in the harshest industrial environments.
The rugged DS3500-ER can be used both indoors and outdoors for asset management, inventory management, picking, traceability, shipping and
receiving applications in warehouses, distribution centers, manufacturing plants or warehouse-style retail stores. Designed for scan-intensive industrial applications, the ergonomic DS3500-ER series is available either corded or in a Bluetooth cordless version with FIPS 140-2 validation enabling greater worker mobility and enhanced security.
HTC released their latest device the HTC One X into the Middle East market earlier this month. The first device from this manufacturer that comes with the long-awaited Android 4.0 (Ice Cream Sandwich).
The HTC One X is powered by a 1.5 GHz Nvidia Tegra 3 chipset with 1GB of RAM and 32GB of internal storage. It fashions a beautiful 4.7 inch multitouch screen protected with Corning Gorilla Glass, and a pixel resolution of 720x1280.
The phone comes with an 8 MP camera that allows you to shoot High Definition videos at 30 frames per second and take great quality still photos at the same time, along with geo-tagging, face and smile detection.
The audio features of the device are powered by Beats Audio for the ultimate listening experience. HTC also packed this phone with many other features like NFC, GPS, Radio and lots more. And they’re releasing it into the Middle East market with a wide variety of accessories.
Ice cream sandwichin your pocket
An exceptional series Canon Middle East unveiled the
latest range of versatile, stylish and
easy-to-use PowerShot A series
models designed to help users
capture impressive images and HD
movies – anytime, anywhere. Each
model combines Canon’s leading
lens technology, a slim and stylish
design and a range of stand-out
technologies that make taking
photos and recording HD movies
easier than ever before.
The new models feature a 28mm
wide-angle lens that help to capture more
of the scene, from group gatherings to
eye-catching landscapes, while the 5x
optical zoom on the PowerShot A810,
PowerShot A1300, PowerShot A2300,
PowerShot A2400 IS and PowerShot
A3400 IS lets users get closer to a distant
subject. For zooming in even further and
capturing more, the PowerShot A4000 IS
features a powerful 8x optical zoom in a
slim, compact body. By detecting motion
and merging multiple images into one
blur free image, Digital IS mode featured
in the PowerShot A810, PowerShot
A1300 and PowerShot A2300 minimises
blur for sharp, clear shots.
For even more advanced stabilisation,
the PowerShot A2400 IS, PowerShot
A3400 IS and PowerShot A4000 IS
feature an optical Image Stabiliser with
Intelligent IS technology.
14 may 2012
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THE oNE SToP SHoP
According to Abdulaziz Al Khalifa, Executive Director of Strategic Development
and Planning, “The SME Toolkit is the single-window solution to access information about initiating, managing and developing enterprises.”
At a workshop attended by more than 100 people, QDB unveiled the localised and freely-available version of IFC’s SME Toolkit web platform in Qatar in both English and Arabic. The SME Toolkit Qatar offers entrepreneurs free,
online, and around-the-clock access to expert information, interactive tools and educational resources to help them implement sound business management practices, access finance, and enter new markets. Available at qatar.smetoolkit.org, the SME Toolkit Qatar supports the efforts of the Qatari government’s National Vision 2030 to enable the private sector and enhance the contribution of the private sector, especially outside of the hydrocarbon sector.
Speaking at the launch ceremony, QDB’s CEO Mr. Mansoor E. Al Mahmoud said, “We are delighted to launch the Qatari version
of SME toolkit in cooperation with IFC and support from IBM. SMEs all over the world and, particularly in developing economies, face challenges to access relevant information to make sound business decisions. We envisage that this toolkit will serve as online one-stop shop for private sector enterprises and entrepreneurs in Qatar to access relevant, up-to-date information to start, manage and grow their businesses.”
He added “This Toolkit, which is customised with locally relevant content to serve the needs and requirements of Qatari private sector enterprises, will be implemented through various Qatari institutions and organisations engaged in the development and promotion of private sector SMEs in Qatar. This toolkit is yet another milestone for all of us, as part of
In April, Qatar Development Bank (QDB) and IFC launched the SME
Toolkit Qatar – an online platform to support and promote the
private sector in Qatar.
sme toolkit
16 may 2012
sme toolkit
our commitment to promote the private sector ecosystem in the country”
The Global version of IFC’s SME Toolkit was launched in 2002 and is available in 32 countries and 18 languages. Its various websites worldwide receive a combined five million unique visitors annually. In many places it is the largest online business support resource in the local language.
“Smaller businesses are a vital part of all economies in this region,” said Mouayed Makhlouf, IFC Regional Director for the Middle East and North Africa. “This toolkit will give them the support and know-how they need to grow and create jobs, helping drive economic growth.”According to Mouayed, only 15 % of SMEs in the region have access to finance and IFC aims to provide financing and advisory services through the toolkit.
In 2006, IFC partnered with IBM to strengthen and expand the SME Toolkit’s capabilities. To date, IBM has invested more than USD three million to co-develop the product on an open-source platform, offering innovative and collaborative features.
Bashar Kilani, Territory manager, IBM, spoke about the role of IBM in promoting SMEs “SMEs are one of the fastest-growing segments we work with. We are very keen to help SMEs to become larger companies. IBM has invested a lot in the know-how available in this toolkit. The SME toolkit is available to many companies around the world and we will continue to improve and contribute to the toolkit.” IBM has also set up its office in Doha in April 2012.
Moving forward, in order to understand the challenges entrepreneurs face in Qatar and how the SME Toolkit can fill that gap, Maha al Essa, one of the co-founders, 974Design, presented her case. She talked about her experience as an entrepreneur in Qatar and what were the challenges and lessons learnt. 974Design was established in 2010 by three Qatari women to provide the local market with a new approach to design.
The important step in their lives came when they faced the question of what they wanted to do in life. Maha said that a quote by Richard Branson- “A business has to be involving, it has to be fun and it has to exercise your creative instincts,” helped them decide that they wanted to venture into the field of design.
They prepared their business plans by attending workshops that helped them develop a good business plan and pooled their funds to finance the idea.
Talking about why they decided to be entrepreneurs, Maha was quick to point out that it was about risk and self expression. They wanted to challenge themselves to be the best in the Qatari market and at the same time wanted to do something that they were passionate about.
But it wasn’t all a bed of roses and the team faced challenges in penetrating the Qatari market and to get people to trust a local agency in comparison to big international organisations. However they overcame the challenge. “As a startup we relied a lot on two main things word of mouth, getting projects and meeting potential clients through our friends and family and social media, We believed it was an important aspect in growing our company, sharing our thoughts, ideas and work with people around the world,” said Maha. Another tactic that they used, was to ask people around them, with experience, who
have taken risks in their own field, what sort of solutions did they come to, how can it be applied to their situation and field.
Maha did have a word of advice for all the entrepreneurs and startups present in the audience. “Always document everything you do, even after meeting send an e-mail to your clients recapping what was agreed on in the meeting. Because throughout a project you may never know what happens, project managers tend to change, team members tend to change.” When asked what would have helped, Maha was quick to reply that some legal help would have done them good. They did not know what kind of contracts should they sign, what elements should be included and so forth.
Keeping all these challenges and questions in view, it was the perfect time to introduce the SME Toolkit. Amna Al-Sultan, from QDB took the stage to take the audience through the various aspects of the toolkit. Demo laptops were placed in the foyer, for the audience to get a feel of the toolkit themselves.
As pointed out earlier, the toolkit is a one stop shop, a hub for information to help entrepreneurs who want to start their business or want to expand. The toolkit currently provides international and local content relevant to the Qatari market. It offers online training, interactive tools, resources (external links) to entrepreneurs and startups.
17may 2012
sme toolkit
“We believe the toolkit is useful for every business throughout the business life cycle. The first phase is developing the idea- the entrepreneur needs information on the market. There is market overview which gives information on the different sectors of the economy, such as publications, reports, links and profile of each sector to find information on the current status of the sector and the prospect in the near future,” explained Amna.
The toolkit provides information on how to write a business plan. It also provides information on the next phase of business – implementing and setup. “If you go to legal and insurance and click on incorporation you will find all information on pre registration, registration, business structure, how to establish and close a business in different sector and a step by step guide on registering a company in Qatar,” said Amna. There is also a section on human resource to get information on hiring and recruiting local and foreign employees.
User can also find downloadable excel worksheets, where they can plug in the numbers and get result instantly.
To grow and run your business, there is no better way than giving your business visibility and help you match with other businesses. Also, entrepreneurs can register their business in the toolkit’s business directory, which will allow them to access special content which will be available soon.
The SME toolkit is available in both, English and Arabic. Also, the toolkit can be accessed through the mobile phone. This is just the first phase and new features will be added- blog, quizzes, calendar of events, expert opinion, training courses-all of which will be announced soon- so stay tuned!
Since the evening was all about promoting and encouraging entrepreneurs, there was an expert panel discussion, on the various aspects of being an entrepreneur in Qatar. The panel included, Andre Van Zijl, QNB, Munther Al Dawood, SDC, Raed Al Emadi, Silatech,
Abdulaziz Khalifa, QDB, Mouyaed Makhlouf, IFC, Sammi Fakhoury, Al Tamimi & Co,
The panel discussion started with Abdulaziz highlighting the importance of the SME sector. “SMEs are very important for Qatar but their contribution to GDP is quite low, so we do understand that there is a problem. We do not have a proper ecosystem to help SMEs in Qatar,” Abdulaziz added.
We have to diversify the economy, and then we have to support the SMEs. All the institutions on the table are trying their best to develop an ecosystem and there is a need to diversify the economy.”
Mouyaed continued on that point and said that about 90% of the businesses globally are SMEs and contribute 50% of employment and access to finance is an issue. But he encouraged the audience to not give up, do the research, study the market and there are enough success stories “Look at Aramex- small company from Jordan, which is global now. If one can do it, many can do it too,” he added.
Talking from experience, Andre said that it is difficult because banks have their own lending policies. A lot needs to be done before SMEs come to the bank and ask for support. From a banking perspective, he suggested that we should always go back to the basics, do the basic financial analysis. It is important to realise that as we approach World Cup 2022, it is time to support the sub contractors and SMEs. Andre highlighted the importance of networking. “It is very important to connect with people. When you are starting a new business, it always helps to know people.”
Talking about the legal framework, Sami said that pledge of movable asset is a very important aspect which needs to be solved, through an asset register providing the banks with the right security for financing.
Munther highlighted how SDC has a number of programmes to support entrepreneurs and SMEs and have had a few successful case studies. It has training programmes, established in collaboration with ILO to educate the entrepreneurs and impart skills to manage. “Being a successful entrepreneur is not an easy job and is a combination of experience with skill. So get enough training, be committed, have a good business plan, study the best practices and lastly always keep risk management in mind,” Munther advised.
Raed said that the Arab spring has brought about more entrepreneurs in the region because the risk-taking spirit has kicked in. He used the example of Tunisia where successful businesses have managed to survive the turmoil. According to him everybody is looking at SMEs as solution for job creation. Raed also cautioned that to be successful, you need to pick your partner carefully. When things are fine, it’s okay, but just as other commitments, when things are down, you need a technically sound partner, they are legally aware and financially secure.
Abdulaziz summed up the panel discussion by highlighting that most of the advice given by the panellist can be adhered to just by using the SME Toolkit!
18 may 2012
Mansoor Bin Ibrahim Al-Mahmoud, CEO, QDB, gives the welcome speech
sme toolkit
Mr. Basher Kilani, Territory Manager, IBM Middle East
Participants networking
Participants exploring QDB’s SME ToolkitPanel discussion
Maha Al-Essa, one of the co-founders, 974Design, talks about her entrepreneurial experience
19may 2012
sme toolkit
Abdulaziz Khalifa, QDB Munther Al Dawood, SDC Raed Al-Emadi, Siltatech Mouyaed Makhlouf, IFC Andre van Zijl, QNB Sami Fakhoury, Al-Tamimi & Co
Amna Al-Sultan presents the SME toolkitTime for audience prizes
20 may 2012
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smes
International Finance Corporation (IFC), the private sector arm of the World Bank, has been actively working
on promoting SMEs globally as well as in the MENA region. Private Sector got talking to Mouyaed Makhlouf,
Regional Director, MENA, IFC, about the role of IFC and how SMEs can make use of the SME Toolkit.
How is the private sector important for an
economy? And within the private sector,
what is the role of SMEs?
The private sector plays a critical role in
development and growth. It provides about 90%
of jobs worldwide.
The role of SMEs in promoting economic
growth and spurring job creation is becoming
more prominent now than ever. Many countries
are recognising the importance of this sector
in the context of the current global economic
slowdown and rising unemployment.
To give a few examples from across the globe,
SMEs contribute to:
• 48% of GDP and 54% of employment in the
United States
• 60% of GDP and 83% of employment in
China;
• And the numbers are as high as 86% of GDP
and 95% of employment in Chile
A recent study by the World Bank shows that
SMEs are the biggest contributors to employment
across 99 developing countries surveyed. This
study also shows that SMEs account for over 80%
of net job creation and 67% of employment in
developing countries.
In MENA, SMEs represent between 80 to
95% of all local enterprises, and account for up
to around 40% of all private sector employment.
Supporting the SMEs is hence an integral part of
the growth and jobs equation in the region.
What is the role of IFC, its investments and
advisory services in SME promotion?
Recent events have deepened the
development challenges in the region and
brought renewed attention to the consequences
of youth unemployment.
The public sector can no longer be the main
provider of jobs in the region – promoting private
sector led growth is critical
IFC is helping SMEs through its investment and
advisory services.IFC investment services address
market failures to finance SMEs through:
• Debt and equity investments in SME- focused
banks
• Risk-sharing facilities to encourage SME
lending
• Trade lines to finance capital equipment and
inventory imports and exports
• Mobilisation of private funding, equity and
debt guarantees
• Build leasing and franchising
• Equity investments through private equity funds
WALkTALkthe
promoting SmEs
22 may 2012
A recent study by the World Bank shows that SMEs are the biggest contributors to employment across 99 developing countries surveyed. This study also shows that SMEs account for over 80% of net job creation and 67% of employment in developing countries.
smes
IFC advisory services provides training and
tools to help SMEs improve strategy, products,
marketing, sales culture and delivery channels,
credit-risk management, information technology
and governance.
IFC advisory works with governments to
improve the business climate and remove the
obstacles that prevent small firms from joining
the formal sector where research shows grow
more and hire more people.
The SME Toolkit, an innovation of IFC, helps
over five million users a year across 32 countries,
in 18 languages, to learn and implement
sustainable business management practices and
increase their capacity, access to finance and
new markets. Through a network of global
partners and local distribution partners, localised
SME Toolkit platforms provides SMEs with
online and mobile phone access to key business
management information (news, how to articles),
interactive tools, business forms in accounting
and finance, marketing and sales, legal and
human resources, business directory and so forth
. A strategic partner since 2006, IBM strengthens
and expands the Toolkit’s technical capabilities.
IFC’s Business Edge classroom business training
workshops have been delivered to more than
150,000 people across Asia, Africa, the Middle
East and Latin America.
Tell us a bit more about IFC’s programme in
the Middle East and North Africa
IFC has been playing a key role in the region. IFC’s
immediate focus has been to restore confidence
in the private sector, which is the critical engine
of economic growth and job creation. We
have committed over USD 2.4billion (including
mobilisation) since January 2011, boosting
investors’ confidence and demonstrating that the
region has a long term potential.
Assuming the political situation stabilises and
new governments are supportive of private sector
development, we expect to invest up to USD 6
billion, including USD 2 billion in mobilisation, in
the Middle East and North Africa over the next
three to four years.
IFC has signed several significant transactions
recently including a loan to support the
construction sector in Iraq (Lafarge), a transaction
to improve access to high-quality generic
medicine (Hikma), and one to help increase access
to finance for small and medium enterprises
(BankMuscat)
Our advisory work is fully integrated into many
of its investments and initiatives. Advisory services
are helping companies improve their corporate
governance, advice on public-private partnerships
in infrastructure, help smaller businesses access
credit, and improve the regulatory framework for
private education.
FC works to make business more inclusive to
women and youth — especially through access
to finance, education, MSME and Business Edge
training programmes.
An integral part of IFC’s strategy over the last
five years has also been to develop Regional
Champion investors in the GCC and mobilise
them to enter developing markets in the region
and outside.
IFC, working with partners, has launched four
initiatives to help the region :
• Small and Medium Enterprise Facility - joint
with IBRD, EIB, & KfW – Approximately
USD 550 million facility was created to help
financial institutions increase access to finance
small and medium enterprises (SMEs) through
a combination of investments and advisory
services
• Education for Employment (e4e)
– a joint initiative with the IsDB - In April
2011, IFC and the Islamic Development
Bank launched the e4e initiative for Arab
Youth.It aims to bring public and private
partners together to improve the quality
and relevance of the skills students bring
into the workforce in order to increase their
chances of employment. It is also helping
demonstrate the viability of private sector
investment in the employment-driven
education sector. Jordan and Tunisia are the
initial target countries; Country road maps
completed
• Arab Financing Facility for Infrastructure
(AFFI) - joint initiative by IFC, IsDB & IBRD -
Its aim is to provide financing and advisory
assistance for infrastructure PPPs, cross-
border infrastructure projects, and other
innovative infrastructure plans with the
potential for regional impact. The facility
includes several components, including
an investment vehicle and a technical
assistance fund. The facility includes several
components, including a private investment
vehicle, a joint IBRD, IFC, IsDB technical
assistance facility (TAF), a public sector
window for financing by IBRD, and a Policy
Forum which supports policy work in the
region. and.
• MENA Fund- It will initially channel USD
300-USD 500 million towards minority
equity investments in diverse sectors in the
Middle East and North Africa.The fund aims
to restore investor confidence in the region,
spur the return of foreign direct investment,
and increase access to finance for smaller
businesses, education and infrastructure
sectors. The fund will be managed by the
Asset Management Company. IFC will provide
up to 20% of its total commitments.
23may 2012
smes
We would like to know more about the
SME Toolkit
The SME Toolkit offers business forms, how-to
articles, community features and much more
to help entrepreneurs, small and medium
enterprises in emerging markets grow and
succeed.
The SME Toolkit (www.smetoolkit.org),
an innovation of IFC, helps entrepreneurs
and small and medium enterprises (SMEs)
in emerging markets learn and implement
sustainable business management practices
and increase their productivity, their capacity,
as well as improve their access to finance and
new markets. Through a network of global
partners and local distribution partners, the
Toolkit provides entrepreneurs and SMEs with
online and mobile phone access to key business
management information, interactive tools, and
educational resources.
Localised SME Toolkit sites include hundreds
of free business forms, tools, and how-to-
articles, in addition to a global business
directory, multilingual community forums, and
a host of other interactive features, as per the
choice of the local distribution partner. Core
content areas include: accounting & finance,
human resources, international business, legal
& insurance, marketing & sales, operations, and
technology.
In 2006, IFC partnered with IBM to
strengthen and expand the Toolkit’s capabilities.
To date, IBM has invested extensive resources
to build the technology platform, continue
to develop a suite of collaborative features
and innovative solutions to leverage the latest
technologies to provide relevant support to
entrepreneurs and SMEs worldwide.
How has the SME Toolkit done in
the region?
In the MENA region, local distribution
partners are financial institutions that have
a vested interest in becoming THE partner
of growth of emerging entrepreneurs and
SMEs, often as they develop SME Banking
departments or deal through SME Banking
Banks, like QDB does in Qatar for example.
They provide the localised SME Toolkit in their
market, as part of their overall non-financial
services, to differentiate themselves, reduce
risk and enable emerging entrepreneurs and
SMEs to become more “bankable”, grow
and expand. They do this in partnership with
key local stakeholders relevant and providing
support to SMEs (from Ministries, to chambers
of commerce, including local business experts,
business services providers, etc), aiming at
building progressively an ecosystem or one stop
shop information platform where local SMEs
and entrepreneurs can find relevant resources
for better managing their business.
Current partners in MENA include Riyad
Bank in KSA, AlexBank in Egypt, and now Qatar
Development Bank, whose ambitious plan for
private sector development in Qatar through
development of local entrepreneurs and SMEs
led to the development of an SME Toolkit Qatar
Mr. Mouayed Makhlouf is the Director of the Middle East and North Africa region. He is responsible for IFC’s investments and advisory programs in more than 20 countries, which aim to support economic development across the region through private sector development.Prior to this appointment, he was Manager, Financial Markets for the Middle East and North Africa. During that time, he helped implement regional industry strategies for IFC’s investment and advisory services arms managing a portfolio of about $1.7 billion.He joined IFC in 1998 in the Central Asia, Middle East and Northern Africa department based in Washington DC. There, he worked on multiple large transaction including major restructuring of the cement sector in Pakistan as well as supervising projects across the region. Mouayed holds a Master of Science in Finance degree from George Washington University in Washington, DC. For more information about the work being done by IFC, please visit www.ifc.org
About
platform, among other non-financial services
that QDB offer in Qatar.
In Asia, it is used by Dialog Telecom, the
leading Telecom Operator in Sri Lanka trained
over 10,000 retailers and distributors with SME
Toolkit, enabling those to create over 3,250
new jobs, contributing to a revenue increase of
40% and 90% of those companies expanded
their business significantly.
In India, ICICI Bank, one of the largest
SME Bank in the world reaches over one
million visitors a year through its SME Toolkit
India, providing over 4,000 tenders regularly
refreshed, enlisting over 500,000 businesses,
and holding regular live chats with key industry
experts, contributing to increased access to
finance and markets to its users.
So the SME Toolkit has been working its way
through in helping SMEs grow in all parts of the
world.
24 may 2012
Mouyaed Makhlouf
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management
“It is what you do and the way that you do it - that’s what gets results.”
A slight variation on the lyrics of the 1939 tune – but that is forgivable. The song was not composed with business management in mind - but is nonetheless a reminder of a truth: how we manage our businesses is perhaps the single biggest determinant of how successful our businesses are.
No where is this truer than in the entrepreneurial SME. Fellow entrepreneurs will tell you that their key challenge is to find the tools for translating the skills, energy and dedication of the core leadership team into a high performing organisation.
The correlation between the extent to which this is achieved and the level of success of the business is direct. In other words, it is crucial.
Three lessons from experience: 1. Make the transition from directly controlling
and managing everything - to empowering the wider team. It is the first step in building a ‘virtuous spiral’.
2. Understand and actively invest in associated skill-building, so that your organisation can
WHAT’S yoUR STyLE?We all know that SMEs are the engine for growth and an important part of the economy. However, while
setting up shop is one thing, it is another to manage it. Elias Mazzawi, Managing Director, EMS MENA, talks to
us about managing an SME.
accept the empowerment you are offering. 3. Build simple, workable management
processes and reporting – and use them. Allow everyone to understand the cause and effect.
Command and control doesn’t helpIn many entrepreneurial SMEs, the core team is very actively involved in the minutiae of the business.
Entrepreneurs are passionate about what they are building and managing. They drive it. This hands-on ‘micro’ approach is in part the very reason for initial success.
But it needs to be used to just the right extent, at just the right time, in just the right way on just the right things. Otherwise, at some point this heavy ‘micro’ involvement can begin to limit potential for success. The challenge is to recognise when the time is right to make the transition – and to have in place the tools and techniques to make it.
Take the example below. Extreme perhaps, but something I saw recently – and it certainly illustrates the point.
• Management set a rule that cars should be washed at a specific time on a specific day.
• This was followed -- to the letter. • In the middle of a sandstorm, a car was
being washed.
Consider the implications:• It’s a waste of effort. The car will be just as
dirty again in just a few minutes.• It’s de-motivating. Consider the employee’s
perspective – washing a car in a sandstorm is unlikely to deliver job satisfaction.
• It could destroy value. There is a high chance that the paintwork on the car would be scratched as sand gets into the cleaning cloth.
• It discourages initiative from the workforce.
Noone considered the changed circumstances. At the simplest level, the car washer could have been doing something more productive - perhaps something that there isn’t time for in the normal day-to-day routine. But there was clearly no mechanism to encourage or allow this.
Extrapolate from this to less extreme but more complicated day-to-day and strategic business situations - how much initiative and talent is being ignored, and what value could it deliver for the business? This common management approach very soon sets a low ceiling for quality, initiative, growth and improvement - at the
26 may 2012
management
level at which the already time-challenged and stretched core team can be involved actively in the day to day minutiae. The first challenge is to be willing to empower employees.
Train, develop, motivateIt’s all very well to say “I will empower the team” – but the team needs to be in a position to accept that empowerment. That requires two things:• Relevant and appropriate skills and
capabilities.• A heightened sense of responsibility and
duty to the company and to its customers.
Training is critical in technical skills, in decision making, in understanding the range of possible actions, and consequences.The region is investing in this -- with substantially increased budgets for training and development. It will be key to enhanced future success. That training must be supported by a corporate culture that fosters learning, allows questioning, rewards success and learns from failure. Management processes, practices and systems must foster this.
Cause and effect management approachSo now, it’s all very well to say “I will take the right steps to empower the business and I will take the right steps to enhance skills, capabilities and attitude - but there needs to be a ‘glue’ to hold this together, to make activity ‘pull in the same direction’. A balanced scorecard approach, pragmatically designed and implemented, fits the bill.
The approach is not new – it has been around since the 1990s. Most recognise it as a scorecard covering a range of perspectives - financial, customer, internal processes, learning and innovation (these vary from company to company). That is important -- keeping a balance measure.
effect map can make a very big difference. Using this approach to plan and manage on a daily, weekly, monthly and annual basis works. Providing it is implemented pragmatically and not over-analytically.
Add in an element of celebrating (rewarding) successes and it becomes a very powerful way to manage the business.
So what should you do differently tomorrow?1. As a small business leader, don’t keep all
the pressure responsibility accountability to yourself. Share it with the team. The business will benefit – provided you set up the environment for success.
2. Instead of making the decisions yourself, consult. Instead of controlling everything very tightly, support.
3. Take advantage of the training and development opportunities available.
4. Put in place a simple, pragmatic, actionable cause and effect management and reporting approach – and use it.
Put these three things in place and the benefits are significant. It becomes substantially easier to manage the business, which at the same time becomes a more successful business.
There is no magic to make all this happen overnight -- but there are many tried and tested techniques. It is worth the effort.
However, far more important in this environment is the underlying principle of cause and effect underpinning the scorecard. • Defining the outcomes wanted across the
four dimensions is a hugely valuable exercise.• Drawing the cause and effect map to
achieve those outcomes is a massive benefit – explicitly stating the steps and actions (causes) that influence results (effect) – creating a shared understanding of these priorities and actions across the organisation – which is then ‘armed’ to pull collectively in the same, right direction.
• Defining the metrics that show progress towards the goals focuses attention.
• Ensuring that the metrics are things that the team’s actions can influence ensures understanding of the actions that make a difference.
• Linking those metrics to departmental objectives – and cascading those to personal objectives focuses the team’s attention on taking those actions.
It doesn’t need to be ‘heavy-duty’ – a simple spreadsheet based on a shared cause and
Elias Mazzawi is Managing Director of EMS-MENA.EMS (itself an SME) works exclusively with mid-size enterprises in the Middle East, driving higher performance in operations, sales and strategy. The EMS approach is distinctively tailored to the needs of mid-size enterprises.There is a focus on quick wins delivered through short, intense and highly focused project bursts of just a couple of weeks. This is Supported by light touch involvement of a day or two a month over a longer period -- to ensure that the change ‘sticks’. For more information, please visit www.ems-mena.com
About
27may 2012
Entrepreneurs are passionate about what they are building and managing. They drive it. This hands-on ‘micro’ approach is in part the very reason for initial success.
Elias Mazzawi
success stories
Please tell us about yourself and how did it all begin. The first organisation of the group was founded in 1964. The National Contracting and Trading, an ‘A’ grade contractor in Qatar is the first and foremost member in the Group, followed by various divisions specialising in engineering and construction. In 2008 we, planned to enter manufacturing sector and we initiated the ‘Qatar National Aluminium Panel Co’ (Q-NAP) and within a short period of establishment we are catering to the needs of the Aluminium Cladding industry in Qatar, covering lion’s share of the local market .
Now, we are concentrating on finding an overseas market. The National Oil & Gas Services is the Oil & Gas Services division of the Group established in 2008 and provides services to Oil &Gas sector in the local market. In association with a group of reputed overseas organisations we are providing Plant Safety Warning System Services, materials, equipments and maintenance.
With a vision of reducing our dependency on imports, as a responsible
father’s business after my studies paved the way to establish my own business. My habit of closely watching the pulse of local industry, learning the trends of the same provided me with information about market requirements, and sparked the idea behind my own establishments.
As a local entrepreneur, growth potential of Qatar and nearby markets is the real inspiration behind those ventures.
How did you set up your business?I visualised the business setup by coordinating expert human resource available within the Group. Execution of the plan was done by a project team under a senior manager; the development was often reviewed by me.
Funding for major establishment is secured in partnership with Qatar Development Bank (QDB).
MAkING ExCELLENCE A HABITNational Group is a cluster of business houses, located in Qatar, with
regional offices in many cities of the region. Sheikh Naif Bin-Ali Al-
Thani, Chairman, National Group, talks to Aparna Shivpuri Arya about
his journey and what has been his mantra for success
With a vision of reducing our dependency on imports, as a responsible citizen of the Nation our decision is to concentrate more on manufacturing sector.
citizen of the Nation our decision is to concentrate more on manufacturing sector. In this regard, National Group is promoting two more building material manufacturing factories in the state of Qatar. Ground preparations are underway and both the facilities will be operational in the fourth quarter of 2012.
Our family is in the field of business in local market for last four decades. Apart from what I learned during my education, working with my father as his assistant was the beginning. Practical knowledge from that experience, is the cornerstone of growth and development of National Group.
How did you come up with the idea to set up your business? What inspired you? Heritage of ‘Arabic Culture’ itself is about business and trade. My involvement with my
28 may 2012
bringing business ideas, shaping it and passing them over to a team of experts to get it established.
I supervise the establishment of the team whenever required. I am always involved in the business by reviewing the progress and setting strategies for the entities and their Management Team, assisting them with their requirements to achieve the goals which we set.
As an industrialist I do believe in excellence. An anecdote which leads my ambition to excellence is a saying of the philosopher Aristotle:
‘We are what we repeatedly do. Excellence, therefore, is not an act but a habit.’ We at National Group are on the way of excellence to inspire others to follow.
success stories
What challenges did you face and how did you solve them? As long as the establishment is new , marketing is the initial challenge which any institution may find. Breaking the market with a new brand of product is not easy as long as there are recognised brands are already present in. In addition, getting expert human resource in reasonable pay scale is another task which any organisation may face.
Intense pre-launch marketing, exhibitions, promotions and introducing technologically-advanced products, best service options are the major tactics we use to break into a market with a new brand.
Recruiting of a few highly skilled experts in the industry is the initial task we may undertake and a team of qualified but less experienced personnel will be created. As an employer we are providing the team with best available industrial training to ensure it meets or exceeds industry standards.
What help or facilities would you have liked? As a local entrepreneur, we do require best services at gateways of the country (ports) to avoid any unnecessary delays in imports and exports. Development of more primary industries (to avail primary raw materials), better infrastructure, establishment of Free-Trade Zones and so forth.
In addition, for manufacturing industries, we would appreciate subsidies from government for exports and incentives against the local business against the volume of business done and the quantity of products manufactured. It will always encourage the existing entrepreneur and pave way for new industrialists.
What are your ambitions and growth plans? How do you plan to achieve them? We are aiming at developing the National Group as a conglomerate with presence all over the GCC. We aim to achieve a billion
Riyals turnover for the Group in the short-run. Our goal is to become an icon of private sector manufacturing in the State of Qatar, in a short while.
National Group is promoting two more manufacturing companies in the state of Qatar and these facilities are scheduled to commence operation by the fourth quarter of 2012.
In order to exploit the expected boom in the construction sector of Qatar we are in discussions with a few of renowned engineering & constructions firms in the world to facilitate large scale investment in the sector, as a joint venture.
What is your entrepreneurship and management style? As a keen entrepreneur and manager I am
In addition, for manufacturing industries, we would appreciate subsidies from government for exports and incentives against the local business against the volume of business done and the quantity of products manufactured
29may 2012
Sheikh Naif Bin-Ali Al-Thani
investment
LENdING A HANd
Qatar Exchange recognises the importance of the SME sector for the foundation of
successful economies, contributing to employment opportunities, wealth creation and increased output. The Qatar Exchange (QE) therefore developed QE Venture Market with the objective of supporting the growth of SMEs and positioning itself at the centre of the government’s ongoing support for this important sector which is a key element in ‘Vision 2030’.
Unlike the existing Main Market, which was
designed for larger companies with established
track records, QE Venture Market was designed
with smaller companies in mind with a more
flexible disclosure and corporate governance
regime. The characteristics of the market reflect the
objectives of allowing SMEs to list and raise capital
more easily and cheaply and with less stringent
requirements than would be the case on the main
market whilst also retaining the trust of the investor
base through a structured regulatory framework.
Why is QE developing an SME Market?
SMEs around the world are key to growth and
prosperity of an economy. Having a dedicated
route to market for SMEs is seen as an important
financing alternative for this sector and we
envisage this solution will be a useful part of the
In January this year, Qatar Exchange announced the formation of Qatar’s
new SME Market, the QE Venture Market. Aparna Shivpuri Arya caught up
with Colin Milton, Deputy Director, Listing Department, Qatar Exchange, to
know more about the initiative and how it will help the SMEs.
SME financing “menu”. It will not be the right
solution for all SMEs but as a way of raising risk
capital as opposed to, for example, further debt or
founder loans we believe that QE Venture Market
will provide a valuable financing alternative.
Qatar has already taken a pro-active approach
to the development of the sector through many
initiatives, such as Enterprise Qatar domestically
and Silatech across the GCC/MENA region, Al
Dhameen, and of course organisations such as
QCCI. The initiative complements National Vision
2030 and is a direct result of the Supreme Council
decision last year to setup and SME Market.
We hope that through market participants
we will be able to create a prosperous and
vibrant market that supports the growth of
SMEs in Qatar. With the addition of the QE
Venture Market to our product suite we are
providing young and entrepreneurial companies
a customised route to market to ensure they have
access to the necessary funds to contribute to
Qatar’s economy.
Why did QE not just lower the criteria for
the main market?
Our analysis suggests that having a dedicated
market reflects international best practice. The
‘network effect’ is strong and for SMEs, having
a high profile platform alongside its peer group
where they are not competing for attention with
the largest listed companies is a significant benefit.
A dedicated market allows us to tailor the market-
place for the investor base to develop around
SMEs which requires a different risk appetite to
that for the main market.
Why should SMEs consider a listing
on QEVM?
The rationale for listing is varied but a listing for an
SME can be thought to provide the following key
benefits (i) diversifying an SME’s sources of funding
away from founding shareholders and or bank
financing (ii) offering liquidity to financial, family
or minority shareholders (perhaps in the context
of succession planning) (iii) offering visibility, status
and valuation through raised awareness of the
brand; comparisons with listed peer group and
Our analysis suggests that having a dedicated market reflects international best practice. The ‘network effect’ is strong and for SMEs, having a high profile platform alongside its peer group where they are not competing for attention with the largest listed companies is a significant benefit
30 may 2012
investment
valuation pick-up (public companies by virtue of
transparency are more highly valued than private
companies) and (iv) perhaps fulfilling part of a
corporate strategic objective.
We expect that entrepreneurial SMEs who are
looking to grow will benefit from a strong ‘network
effect’ in joining the community of companies
listed on the main market and the QE Venture
Market which after all represent some of the most
progressive companies and best management
teams in Qatar.
Over and above the normal benefits of
listing are there additional advantages to
the QEVM?
Indeed, in particular we believe the QEVM provides
(i) a dedicated entry route to public markets that
would in other circumstances not be available
(ii) a universe of peer group companies which
can be beneficial to investor following, research
coverage and ultimately maximisation of valuation
(iii) flexibility to develop a regulatory structure best
suited to small and mid-cap companies and (iv)
flexibility to develop a lower cost pricing structure
for small and mid-cap companies.
In addition, unlike the more established
markets of AIM, Alternext, GEM and Catalist
we plan to take a more pro-active approach to
the development of our SMEs. SMEs often need
help in, for example, terms of business systems
and process, business facilitation, board and
governance structure. We plan to enlist the help of
partners in Qatar who will be available to the SMEs
in developing these areas of their business.
There still seems to be a lot to do so isn’t it
too early to launch?
We acknowledge that the larger ecosystem
needs further development but at the same
time the technical and regulatory infrastructure
is in place so we can accept companies. The
development of the eco-system is always a
long-term undertaking but we have taken the
view that on balance providing the platform and
in parallel working with market participants to
develop the eco-system is preferable to waiting
and restricting choice for SMEs.
You refer to the ecosystem; what do you
mean by this?
The technical and regulatory structures are in some
respects the easiest to put in place. When we
talk about the eco-system we mean developing
the network of banks and brokers; lawyers and
accountants and other market professionals who
will be necessary to support the market. The
rationale for each will be different but in the end all
market participants will need to be incentivized to
develop the market.
What are the key features of the Rules
published by QFMA?
As a market for SMEs the Rules incorporate
relaxed entry criteria notably a one year track
record (rather than three from the Main
Market); a free float requirement of 10%
(rather than 20% normally) and a minimum
subscribed capital base of QR 5 million (rather
than QR 40 million normally). The judgment
is that these criteria will accommodate SMEs
but still provide the necessary trust element
to encourage investors whilst acknowledging
the risk element involved in investing in small
companies.
What about ongoing disclosure?
Companies in the QE Venture Market will be
required to follow a periodic and ongoing
disclosure regime which is similar to that
for the main market including quarterly
reporting and the announcement of material
price sensitive information. This transparency
should help to ensure that investors are not
misinformed regarding material changes to
the companies’ business and therefore their
prospects. Colin Milton
All applicants are required to have a Listing
Advisor on an ongoing basis; won’t that be
expensive?
The Listing Advisor is an important part of the
“trust” relationship between issuer and investor.
We recognise that SMEs will need ongoing
guidance as to the Rules and it is the Listing
Advisor’s job to ensure proper practice and
disclosure is being adhered to. Without this
investors will be less inclined to participate in the
marketplace. The cost will be a topic for bilateral
discussions between an issuer and the Listing
Advisor. However, the monetary cost should be
balanced with the benefits of increased trust in the
market, increased investor following and a reduced
cost of capital.
The Rules have now been published so when
do you expect your first listing?
We have already begun the process of talking
to some of the key participants in the SME space
and envisage hvolding further workshops on
an ongoing basis. We cannot predict when the
market will have its first listing as it is conditional
on a large number of external factors including
company preparation time, regulatory approvals
and market conditions to name but a few but the
whole financial community will be working toward
a successful market as soon as possible.
Will this be just for Qatari companies?
No. Whilst Qatari companies will likely be the
mainstay of our market, the rules allow for foreign
companies to list (without a dual listing in their
home market as is the case for the Main Market)
so we aim to encourage companies from the GCC
and MENA to look at the QE Venture Market to
satisfy their funding needs.
Finally, where can the Listing Rules for
the Market be found and where should
companies go to seek further information?
The relevant Rules can be found on the QFMA
website under the “The QFMA Offering and
Listing Rulebook of Securities of the Second
Market”. In addition there is a dedicated
website for the QE Venture Market
www.qe.com.qa/qeventuremarket. Details of the
listing criteria and process can be found on the
information portal as well as contact points for
further questions.
31may 2012
BEyoNd THE dRoP
QNV 2030 aims to create employment opportunities for the national work force
that go beyond the still dominating hydrocarbon-based economy of today. Creating employment has been recognised as critical for the long term stability of the economy as well as the overall harmony in the community.
Pushing the envelope remains to be a key
strength in Qatar, taking the concept of what
defines an SME to another level. Qatar’s Finance
Minister Yousef Kamal recently announced Qatar’s
investment of USD 1 billion in overseas small
enterprises. The Supreme Council for Economic
Affairs and Investment is mulling a plan to establish
a dedicated legal entity with the scope of investing
in small enterprises abroad. This would probably
add to the existing line-up of international
acquisitions, such as Harrods, Sainsbury’s and
Barclay’s. Hardly small enterprises one would think.
If we limit the definition of SMEs to start-ups
or companies having a turnover of up to QAR 50
million per annum, the absence of bankruptcy
laws, the length of visas afforded for potential
migrant employees and majority-stake of the
sponsorship will continue to be challenging.
On a positive front, an area where an increasing
number of banks and Mashreq-Qatar in particular
have been making significant contributions to is the
Finance
Mashreq is one of the region’s leading financial institutions and the region. Founded in 1967 as Bank of Oman, the bank has played a pioneering role in the industry, particularly in retail banking.As a leading financial Institution in Qatar, Mashreq aims to be world class in every facet of its business; including its social responsibility to the community it serves.
About
rather crucial aspect of funding projects in this realm.
“We need to arm these businesses with flexibility and
provide credit facilities with managed exposure for
them to grow to be fruitful assets to the economy.
A joint programme on the lines of the Al Dhameen
programme that we share with Qatar Development
Bank extends the scope of this financing. This we
hope will alleviate some of the upfront overheads
such as licensing costs,” says Howard.
By providing fertile ground for the development
of the necessary policies and regulatory framework,
also the Qatar National Development Strategy
(NDS) 2011-2016, published by Qatar’s General
Secretariat of Development Planning, aspires
to further facilitate the integration of small
and medium enterprises (Small and Medium
Enterprises).
The development of SMEs in Qatar
today is rising at a fast pace. Qatar
Exchange recently announced
that it will host an SME market
providing the required technical and
regulatory infrastructure. These
will only drive the momentum
of Qatar’s vital SME sector
and draw foreign and
domestic investors. Various
organisations such as
Qatar Development Bank,
Silatech, Enterprise Qatar
or the Social Development
Center have also made inroads in laying the
foundation stones to enable the growth of SMEs.
The launch of the SME Evolution Programme, a
free web-based training programme by Enterprise
Qatar is particularly interesting, providing young
entrepreneurs the backing of a network of like-
minded individuals across the region.
Qatar’s efforts pertaining to SMEs are the way
to the future for banks, an example that should be
replicated across the Middle East. A recent survey
conducted by The World Bank shows that the
share of SME lending is abysmal. At only 8 % in the
Middle East and North Africa (MENA), and a paltry
2 % in the GCC the share of SME lending in total
bank lending has been giving reason for concern.
Traditionally SMEs are associated with high credit
risk; given Qatar’s crowded banking market, it is
inevitable that commercial banks move from their so
far niche specialisation to also serve SMEs and work
in partnership in addressing any legal and regulatory
barriers. The approach to SMEs is clearly very different
to retail banking and wealth management services
that currently dominate Qatar’s banking landscape.
There is no singular formula to serve SMEs, but
banks must constantly be innovative in finding
ways to manage both costs and credit risk and
at the same time screen clients prior to acquiring
them. Tools such as credit scoring will allow the
banks to better serve their clients and adapt their
portfolios accordingly. An analysis of the market
as well as an inward look at one’s own business
model including that of the client are paramount
in giving a more focussed execution capability in
credit risk management. This will prepare banks
with risks associated with SME clients processing
their relatively smaller transactions at lower cost
and offer the clients better service quality.
Outlined by His Highness The Emir, Sheikh Hamad Bin Khalifa Al Thani,
the strategic objectives of Qatar National Vision (QNV) 2030 for economic
diversification in the country are aimed at enhancing the scope and role
of the private sector in the country’s economic development. Howard
Kitson, Country Head, Mashreq-Qatar, tells us about the country’s efforts to
promote SMEs as part of the national vision.
32 may 2012
http://www.PrivateSectorQatar.com/en
valuable business advice that will help develop your business.
Be part of a community spanning magazine, events, Website and social media.
Before you set up a business, it is most important to know what the market wants and whether you can
tailor your product or service to that particular market. Bedaya Centre explains the concept of market
research to us and how is it beneficial for a startup or SME.
kNoW yoUR NEIGHBoURHood
business setup
How does one define market research? There are many ideas out there, but how do
you distinguish the good ones from the not so good? A good idea is one that you will be able to turn into a viable business and usually has to tick the three boxes:
• Is there a need for it in the market?
• Is it technically feasible?
• Is it commercially feasible?
If you said yes to all three, then you are on to
something good. The process you use to answer
the questions above is your market research.
Therefore, market research is used to discover what
people need. This process involves gathering and
analysing data about a specific product or service
as well as the current environment where it will be
deployed.
The first steps
Every entrepreneur believes their idea will
be money- generating, and successful. You
would not be an entrepreneur if you didn’t
have this passion and conviction. However,
this leads many entrepreneurs to go straight
into execution phase only to realise that after
spending all their time, energy and capital that
the business just didn’t work. By conducting
market research you gain understanding about
your potential customers, the environment and
economy you are working in as well as your
competitors thus allowing you to position your
business more effectively and increasing your
chance of success.
When conducting market research you are
effectively taking the first steps in discovering
whether your business idea is economically viable.
This process of discovery is done through a series
of quantitative (how, when, what) and qualitative
(why and how) questions on the four most
important focus areas.
Know your product: The product is effectively
the “Idea” that made you want to start your
business, because you believed you had something
the rest of us wanted. It’s the service you provide,
the item that you sell or a combination of both. At
this stage, your product is still in the design phase
and before you spend your capital on development
you should be able to answer the following:
• How does it work
• What value does it add?
• What customer needs does it address?
• How much will it cost?
• How long does it take to build and deploy?
Know your customer: This essentially answers
the questions “Is there a market for your
product?” and “who would your target market
be?” It’s easier to sell when you know who to
sell to. Therefore, before launching your product
you should go through an exercise of identifying
the following:
• What is your customer base, based on
demographics, income and so forth?
• Where are they located?
• When do they buy?
• Why do they buy?
• How can you reach them?
• What are their buying habits?
This will enable you to position your product
better by specifically targeting a segment of the
market that needs or wants your product. You will
also have enough knowledge about the type of
customers you have and will then be able to create
marketing campaigns that specifically target them.
Know your competitor: One of the most
important steps in market research is to know
34 may 2012
business setup
your competitors and what are they offering.
Very few businesses start as unique or market
leaders. However, for the rest there are at least a
few competitors already in the market with similar
offerings. The main questions to answer are:
• Who are your competitors?
• How many competitors do you have?
• What are their Unique Selling Points (USPs)?
• What is their pricing model?
• What additional services do they provide?
• Why would their customers come to you?
Know your environment: Surveying the
market before deployment and launch helps
entrepreneurs by providing them with valuable
data on the current landscape which can then
be used by decision makers when designing
their product and services in order to meet
the demands and needs of their customers.
By addressing the following you will be better
positioned to have a successful business:
• How stable is the economy in your area?
• What is the current rate that SMEs are growing by?
The how
Market research can be done in a number of
different ways. The most popular way to start is
through extensive Internet research. The internet
offers you valuable information on your competitors,
their value proposition and current market
conditions. Other methods include customer surveys,
mystery shopping, working with focus groups, and
actual testing of prototypes in the market
Although there are a number of companies who
specialise in market research they can be very costly
and can take a huge cut out of your budget. Its best
to do as much research using your own resources,
this not only saves you money but also helps you in
gaining hands-on knowledge regarding the market,
your customers and your competitors.
When conducting your own research you
should focus on both indirect and direct research.
Direct research covers all the information that
In addition to the toolkit, there are a number
of good sites that offer comprehensive business
information that can be used for market research
and will provide you with in-depth information on
current market conditions and your competitors.
There are also a number of free and paid
sites that help prepare your surveys and
analyse your results. The most popular being
http://www.surveymonkey.com that offers
readymade survey templates as well as the option
of sending your surveys to a specific targeted
audience. Your survey results will offer you
information on your customers and your product.
Finally, never underestimate the power of
social media when conducting market research.
This is an excellent medium for reaching out to
large group of people at the same time. You can
use this as a testing ground for your product,
assess your customers’ needs and build on their
feedback. It’s also been proven that through social
media, customers feel they have an influence on
the business and become part of the initial design
of the product. This overall feeling of involvement
is an excellent start to having a relationship with
potential customers.
The when
Market research in an ongoing process, you use
it to assess the viability of your business before
starting and you use it constantly once your
business is up and running. Since buying habits
and trends are not static, the constant change of
people’s needs and the increasing use of innovation
and technology means your product and services
have to change to meet future demands.
Make market research your mantra to
ensure continuous business success at all stages
of your business.
is already available in the market and ranges
from company or product specific to country
specific. You can obtain this information
through government reports, business surveys,
your competitor’s business financial reports,
industry magazines and information provided by
municipalities and government agencies.
Indirect market research requires more in-depth
analysis and research work. This is where you
discover your customers’ buying habits and their
appetite for your product by observing them,
conducting surveys, talking to focus groups and
testing your prototype. You will usually need a
team of people who can help you with this part of
the research. As you will be collecting a lot of data
and you need to analyse the numbers properly in
order to help you predict your business success.
As mentioned conducting your own market
research can save you money but at some
point you might need to rely on experts and
consultants to work on a certain section of your
research or to provide feedback on what you
have already completed.
Most entrepreneurs will start their market
research using online services. Unfortunately
many of the current services offer information on
European/American industries and demographics.
However, Qatar Development Bank has
recently deployed their SME Toolkit which
provides sector-specific information for the
Qatari market covering different industries
such as tourism, health and education. The
toolkit also provides a list of resources per
sector including market studies and impact
reports as well as information on legal
requirements and registration for companies
in Qatar. The tool is a very valuable resource
for entrepreneurs who want to setup
companies in Qatar as it offers specific country
information. The tool can be accessed online
through QDB’s company website.
The Bedaya Center is a partnership between Silatech and Qatar Development Bank. With the tag line “for entrepreneurship and career development” it has a prime focus to encourage young Arabs set up their own businesses and look to the many opportunities presented by the World Cup 2022.
About
35may 2012
The product is effectively the “Idea” that made you want to start your business, because you believed you had something the rest of us wanted. It’s the service you provide, the item that you sell or a combination of both.
entrepreneurs
REWARdING SUCCESS
EO Majlis, the first regional learning event hosted by Entrepreneur’s Organisation, and sponsored by
Enterprise Qatar, brought to a close two days of inspiring talks that brought together some of the region’s most successful entrepreneurs to boost enterprise creation in Qatar.
Hosted by the EO chapter of Qatar, the event
brought together over 60 entrepreneurs from
around the Gulf region to gain unique insights
from some of the world’s leading figures in
entrepreneurship and innovation and learn about
Qatar’s efforts to support the next generations of
business owners.
Participants heard from leading experts
in entrepreneurship and business practices
including Verne Harnish, Ben Casnocha and
Charles Leadbeater. Hassan Al-Thawadi, CEO
of the 2022 Qatar World Cup bid, talked to the
group about the challenges his team faced and
how they were turned into opportunities for the
history-changing campaign.
The second day was open to the public and
focused on the attributes of the successful
entrepreneur, with the speakers drawing from
their own personal experiences.
The lectures were concluded with a panel session
discussing the role of education in supporting
entrepreneurship. Moderated by analyst and
consultant Taufiq Rahim the panel drew on an
exciting mix of speakers including Tracy Pryce,
principle of learning and development at Enterprise
Qatar (EQ) being diamond sponsor for EO Majlis,
Dr. Sheikha Al Misnad, President of Qatar University,
global thinker on innovation Charles Leadbeater, US
entrepreneur and writer Ben Casnocha and Bedaya
Centre Manager Saleh Al Khuleifi,.
The programme ended with a lunch meeting
with Carnegie Mellon University business students,
where EO members talked about their personal
journeys and shared advice.
Khalifa Al-Misnad, Qatari entrepreneur and
President of EO Qatar expressed his delight that
the event had made a positive impact.
He summarised, “EO Majlis achieved the
goal we set when starting out; chiefly to
provide a boost to the community of individuals
and organisations working hard to support
SME’s in Qatar and the region and encourage
entrepreneurial culture. We brought to Qatar
some of the world’s leading entrepreneurs and
global thinkers, and we had many enriching
exchanges. We ensured the second day was
open to the public so that the speakers’ wealth of
knowledge and experience could be shared with
aspiring entrepreneurs from local universities. This
is the first in what we hope will be a long line of
successful and inspiring EO Majlis events”.
EO Learning Chair and Event Organiser
Mohamed Jaidah thanked Enterprise Qatar for
partnering as diamond sponsor, and Standard
Chartered Bank as platinum sponsor. Ms. Noora
Al Mannai, CEO, Enterprise Qatar said, “Our focus
at Enterprise Qatar is to develop and encourage a
culture of business innovation, entrepreneurship,
risk-taking and creativity. As we do this, we
recognise the potential of a flourishing SME
sector to provide the economic diversity that this
Enterprise Qatar was part of two events last month to encourage and recognise entrepreneurs in Qatar. Private
Sector brings you a snapshot of these events.
36 may 2012
entrepreneurs
country seeks in order to strengthen its economy
and so what we seek to do is create the perfect
‘ecosystem’ to enable the SME sector to achieve its
potential.”
Charles Carlson, CEO of Standard Chartered
Bank, Qatar, said, “We are very pleased to be
involved in this event which has been very fruitful
so far. We look forward to working closely with EO
Majlis in the future and participate in the growth
of the SME market in Qatar together with partners
such as Enterprise Qatar (EQ)”.
The other event, Ernst & Young Entrepreneur
of the Year Award 2011 (EOY 2011) was recently
announced in Doha at a Gala dinner hosted by
Enterprise Qatar and Ernst & Young at The Ritz-
Carlton hotel. The EOY Awards 2011 were held
for the very first time in Qatar under the patronage
of HE Sheikh Jassim Bin Abdul Aziz Al Thani,
Minister of Business and Trade.
The award, which is key in the discovery
and promotion of talented entrepreneurs, was
presented to Ashraf Abu Issa, Chairman of Abu
Issa Holding, by Sheikh Mohammed Bin Abdul
Rahman Al Thani, Head of Enterprise Qatar
Executive Committee and Board Member of
Qatar’s SME Authority, Noora Al Mannai, CEO
of Enterprise Qatar (EQ), Abdulaziz Al-Sowailim,
Chairman and CEO of Ernst & Young MENA and
Firas Qoussous, Managing Partner of Ernst &
Young Qatar. Abu Issa won the highly esteemed
award for establishing one of Qatar’s key retail
empires and setting unique an exemplar for
business in his industry.
Ernst & Young’s Entrepreneur of the Year
recognises outstanding entrepreneurs for their
vision, innovation, courage, and leadership in
building and growing successful businesses that
influence the way we live, the products and
services we depend on, and the economic vibrancy
of our local communities and global markets.
Seven visionary entrepreneurs representing
six companies were shortlisted as finalists for the
Ernst & Young Entrepreneur Of The Year Qatar
2011 Award, including the winner Ashraf Abu
Issa in addition to Omran Al-Kuwari of GreenGulf
Inc, Zeyad Al Jaidah & Abdulla Alansari of Techno
Q, Abdulaziz M. Aldelaimi of National Petroleum
Services, Mohammed Al Emadi of Al Emadi
Enterprises and Jassim Al-Mansoori of iHorizons.
The judges’ committee comprised a league of
highly recognised figures in Qatar; H.E. Sheikh
Dr. Abdullah Al-Thani, President of Hamad Bin
Khalifa University; H.E. Dr. Hessa Al-Jaber, Secretary
General of ictQatar; Mr. Saad Sherida Al Kaabi,
Director, Oil and Gas Ventures of Qatar Petroleum,
and Mr. David Norwood, Vice President of
ExxonMobil – Qatar.
Ernst & Young has been running the
competition for over 25 years globally but this is
the first year that Qatar has hosted this business
award programme, which is considered to be
the most prestigious for entrepreneurs. Sheikh
Mohammed Bin Abdul Rahman Al Thani, Head of
Enterprise Qatar Executive Committee and Board
Member of Qatar’s SME Authority said, “First of
all, we would like to congratulate Ashraf Abu Issa
on a brilliant job done with Abu Issa Holding and
thank Ernst &Young for bringing this opportunity
to Qatar and recognising the great achievement
of the entrepreneurs and their contribution to the
growth of the economy.”
Economic growth is one of the main pillars for
the development of any society, and Enterprise
Qatar (EQ) has been established to help, support
and create an enterprise culture across Qatar and
enable SMEs to growth, develop and thrive; added
Sheikh Mohammed Bin Abdul Rahman Al Thani.
Noora Al Mannai, Enterprise Qatar (EQ) CEO,
said, “Enterprise Qatar (EQ) is mandated with
supporting entrepreneurs, potential entrepreneurs,
start-ups and SMEs owing to the crucial role
they play in today`s economies, fuelling growth,
creating jobs and building communities. This is
the first time that this prestigious competition
has taken place in Qatar, which is testament to
the country’s rapid development and flourishing
economy, and we, at Enterprise Qatar, are
honoured to be involved in such a globally
recognized and remarkable initiative”.
Al Mannai concluded by encouraging any
Qatar-based entrepreneurs to approach Enterprise
Qatar for support and advice in taking their
creative ideas and innovations forwards.
Abdulaziz Al-Sowailim, Chairman and CEO of
Ernst & Young MENA, said, “It gave me immense
pride that we were able to bring our Entrepreneur
of the Year Programme to Qatar and all of our
finalists were deserving of the accolade. They
have worked tirelessly to build their businesses
and I was delighted to be part of the ceremony to
celebrate their achievements. My congratulations
of course go to Ashraf Abu Issa who will now go
on to represent the State of Qatar at our World
Entrepreneur of the Year Award in Monte Carlo
in June and I wish him every success there. I now
look forward to next year when we hope the
stories of this year’s finalists inspire even more
entrants to our program.”
Ashraf Abu Issa will officially represent the State
of Qatar in the Global World Entrepreneur Hall of
Fame to compete for the title of Ernst & Young
Entrepreneur of the Year in Monte Carlo between
7th and 10th of June 2012.
Ernst & Young Entrepreneur of the Year Award 2011
37may 2012
agency, follow up to ensure that they have received
it. Do call and speak to a consultant. You will
then have the opportunity to properly discuss your
background and aspirations. You might want to
make a career change which is not mentioned in
your CV. Discuss what kinds of opportunities are
out there in the market. You might be happily
surprised and ready for that change. Qatar offers
you many different opportunities you would not
have had in your home country or in the country
where you lived before moving to Qatar.
Make sure you stay in contact with the
employment agency where you submitted your CV.
If you directly submitted your CV with a company,
like through their Website try to find out who
the responsible person is who could help you
further in the process. Although experience has
taught us that it is hard to find out who the right
person to speak to is. Further on, in Qatar it is very
important to know the right people, the people
in your network and personal and professional
relationships that you have built. This is because
many roles in Qatar are not advertised but created
when a specific candidate profile is presented to
the business.
Global Women Qatar was established in January 2012 as Qatar’s first employment agency to focus exclusively on the recruitment of women who already reside in Qatar. We are a very dynamic, rapidly growing employment agency with both local and expatriate women in our database. Our candidates come from different educational backgrounds with a variety of qualifications and skills such as HR, Learning & Development, Sales & Marketing, PR & Communications, Finance, Accountancy, Project Management, Healthcare, IT and PA/Secretarial. We chose to focus on women as women in Qatar are one of the important pillars of Qatar’s National Development Programme (2011 – 2016) and Qatar’s National Vision 2030 and they are very eager to work and to further grow their careers.
About
human resource
GET REAdy FoR THE MARkET
At Global Women Qatar we receive CVs on a daily basis, from candidates from
different cultures and educational backgrounds. Not every CV looks the same. We noticed that different nationalities mould their CVs into different formats. But what does the Qatari market want to see in your CV?
Before you start writing your CV think about what
kind of role you are exactly looking for, which you feel
you would like to do and what you are good at and
then make sure your CV reflects this. You do want to
create a positive impression about yourself.
• CVs give basic information – your education,
work experience, skills and achievements.
• Cover letters explain why you want the job and
what makes you the right person for it. State
your motivation and suitability in a positive way.
CV tips
• The presentation of your CV is vital. Keep it simple.
You want your achievements to stand out.
• Be consistent in the usage of letter font that is
clear and easy to read, such as Arial.
• Stick to preferably two pages and mention
the most relevant and important information.
Potential employers are not interested in you
having won a line-dance competition when you
were sixteen!
• At the top of your CV start with your name
and contact details. Make sure you include your
date of birth. In Qatar it is also very important to
include a professional picture of yourself.
• Make sure you include information in the
following order – relevant jobs and work
experience, achievements, education,
qualifications, and interests that help prove you’ve
got the right skills and experience for the job.
• The following information should not be
included – information on your children, state
of health, or reasons why you left other jobs.
• If you apply for different kind of jobs make sure
you change your CV for each job you apply
for. Carefully look at the job description and
emphasise the skills or experience mentioned.
• If you’re asked for referees, include a past
employer, a university teacher or a sports coach.
Before you add the referees to your CV make
sure to ask that person if they will give you a
reference. If you haven’t asked write “References
available on request” at the end of your CV.
• Read over your CV a few times and make sure
there are no spelling mistakes.
CV language
• Keep sentences factual, to the point, sharp
and positive. For example “Conducted training
for senior management” or “Gained valuable
experience in HR consultancy and business
development”.
• Make sure your CV is always up to date.
• Use bullet points to list your skills, work
experience and achievements in recent jobs.
• Keep your CV positive and make sure to
highlight your achievements.
• Make sure the information in your CV is correct and
right else you’ll get caught during your interview.
After submitting your CV to an employment
How do you know that your CV caters to the expectations and
requirements of the job market in Qatar? Is there a specific format?
Elsbeth Blekkenhorst and Danielle Maynard-Duttenhofer, Founders, Global
Women Qatar, tell us how to get our CV in order for the Qatar market.
Elsbeth Blekkenhorst and
Danielle Maynard-Duttenhofer
38 may 2012
legal
Since 2002, new laws with respect to
trademarks, registered designs and
patents have been passed. During
this time, Qatar has also acceded to various
international treaties, including the Berne
Convention, the Paris Convention, the Patent
Co-operation Treaty, the WIPO Copyright
Treaty and the WIPO Performances and
Phonograms Treaty.
While these steps are a marked improvement,
they hopefully only mark the first of a long line
of reforms in the field of intellectual property
for Qatar. As Qatar seeks to further diversify its
economy as part of its National Vision 2030, it will
move away from its traditional reliance on oil and
gas towards a knowledge-based economy.
As part of this reform, further changes will
hopefully be made to Qatar’s existing intellectual
property laws and practice to provide additional
comfort to potential investors and international
rights holders that their valuable assets may be
effectively protected in Qatar.
A brief note on some of the key provisions of
each of the current laws and practice follows:
Law No. 9 of 2002
Law no. 9 of 2002 pertaining to Trademarks,
Commercial Indications, Trade Names,
Geographical Indications, and Industrial Designs
and Models was issued on 8 June 2002. To
date, the Implementing Regulations to this law
have yet to be drafted.
Trademarks
The existing trade marks law and registration
procedures in Qatar are adequate for providing
national and international brand owners a base
level of protection for their trade marks in Qatar.
The current law forms an essential part of the legal
framework that encourages brand owners protect
their trade marks as a first step to commercializing
their brands through the sale or licensing of
branded products and services in Qatar.
Qatar Airways and Al Jazeera are shining
examples of how the current framework in Qatar
has enabled two local businesses to protect and
foster their intellectual rights in Qatar, before
building up an international reputation by using
and protecting their brands abroad.
Further reforms are necessary, however, in order
to provide brand owners with an even greater
level of comfort for protecting their brands in
Qatar. Currently, trade marks are classified in
Qatar with respect to an earlier version of the Nice
Classification (which is an international system for
classifying goods and services).
In an effort to bring its practices further in
line with current international standards, Qatar
would be wise to adopt a more recent edition of
the Nice Classification. Qatar currently classifies
trade marks according to the 42 classes of the 7th
Edition of the Nice Classification, which entered
into force on 1 January 1997.
In the 15 years since then, three subsequent
editions have been implemented, with the
10th Edition entering into force on 1 January
2012. International brand owners are used to
classifying their trade marks under the 9th or
10th Editions of the Nice Classification – which
both have 45 classes.
On this basis, there is some disconnect between
Qatar and the majority of the international
community with respect to the way in which it
classifies trade marks, and will hopefully address
this issue in the next round of reforms.
Before the turn of the millennium, Qatar had very few regulations in
force that allowed intellectual property rights to be protected. In the
last decade, Qatar has made real progress towards enacting legislation
and implementing practices to enable rights holders to protect their
intellectual property in Qatar. David Harper, Associate, Clyde & Co,
explains to us the importance of Trademarks.
PRoTECTING WHAT’S yoURS
40 may 2012
Qatar Airways and Al Jazeera are shining examples of how the current framework in Qatar has enabled two local businesses to protect and foster their intellectual rights in Qatar, before building up an international reputation by using and protecting their brands abroad.
legal
In addition, if the Implementing Regulations were
issued to supplement the existing law, then this
would help to clarify boarder measures, opposition
procedures and documentary requirements
(especially with respect to foreign applicants).
Industrial designs
To date, the Implementing Regulations to this law
have yet to be drafted and a receiving office for
design applications has yet to be set up. Therefore,
it is not currently possible to obtain registered
protection for industrial designs in Qatar.
Traditionally, designs have been protected
by way of cautionary notices published in local
newspapers. While such cautionary notices serve to
put third parties on notice of an applicant’s rights
in the design, a cautionary notice is not as effective
as a registration, as it does not afford rights holders
with the same level of protection.
Arguably, the publication of a cautionary notice
would help to deter third party infringers and
could be of assistance in an infringement case.
However, as a cautionary notice does not afford the
right holder with any formal degree of registered
protection for its design, the publication of the
design could provide a third party with the means
to develop a similar design that narrowly avoids the
scope of the design contained in the cautionary
notice. In this way, the publication of a design in a
cautionary notice could actually be detrimental to
the rights holder.
Patents
Qatar enacted a Patent Law in 2006 (pursuant
to Decree No. 30 of 2006). This law envisaged a
patent office being set up within the Ministry of
Economy, with filing and examination procedures
being dealt with pursuant to Implementing
Regulations.
However, no Implementing Regulations have
been issued and the patent office is not yet
functional. Accordingly, it is not currently possible to
file a patent application in Qatar.
GCC patent protection in Qatar
Many patent applicants seek to obtain protection
for their technology in Qatar by filing for patents
with the GCC Patent Office in Riyadh.
The GCC Patent Law operates on the premise
that patents granted by the GCC Patent Office apply
in all GCC states, with enforcement of GCC patents
being the responsibility of each individual GCC state.
Qatar ratified the GCC Patent Law and
Regulations in 1996. The ratifying legislation
specifically gave force of law in Qatar to the system
operated by the GCC Patent Office. However, this
legislation does not deal with the enforcement of
GCC patents. As a result, at present, there is no
clear regime for enforcing patents granted by the
GCC Patent Office in Qatar.
Patent Convention Treaty (PCT)
Qatar recently acceded to the Patent Convention
Treaty (PCT), with effect from 3 August 2011.
Rights owners with an interest in Qatar may look
forward to making use of the international system
offered by the PCT in order to obtain protection
in Qatar more efficiently and effectively than is
available under the current system.
However, the introduction of the PCT in Qatar
will not give rise to any immediate change in
practice. Until the Patent Office starts to accept
patent applications and the Implementing
Regulations are issued, it will not be possible to
file a patent application in Qatar.It is hoped that
Qatar’s accession to the PCT will result in a clear
regime for securing and enforcing patent rights in
Qatar. In the meantime, the only option for those
seeking to secure patent protection in Qatar
remains to file for protection through the GCC
Patent Office, taking into account the potential
enforcement difficulties of this option.
Copyright
In 2002, the law of Protection of Copyright
and Neighboring Rights was passed. However,
Implementing Regulations have yet to be issued.
Law No. 7 of 2002 protects original literary and
artistic works including computer programmes
and databases which are creative in the selection
and arrangement of their subject matter. Qatar is a
member of the Berne Convention, and protection
under the copyright law extends to works covered
by international agreements.
Interestingly, under this law, works of national
folklore is deemed to be public property of the
State, which is charged with its protection by ‘all
legal means’ and shall act as the author of works
of national folklore.
The way forward
In the last decade, Qatar has made rapid
progress in enhancing its intellectual property
laws. While there is room for further reform,
the steps already taken cannot be overstated.
Intellectual property laws are just one factor
contributing to gaining and enhancing the
business confidence of major international
companies in the retail sector. Business
confidence in the retail sector is crucial to Qatar’s
long term economic success.
David is an intellectual property solicitor in Clyde & Co. David holds a Bachelor of Laws degree and a Bachelor of Arts degree from the University of Otago, New Zealand. David is admitted as a barrister and solicitor to the High Court of New Zealand. He joined Clyde & Co in 2008 and specialises in intellectual property law, dealing with contentious and non contentious matters. Prior to joining Clyde & Co, David worked in a dedicated intellectual property team within a large commercial firm in New Zealand. If you would like further information please contact David Harper at david.harper@clydeco.com.qa.
About
Note: Qatari Laws (save for those issued the Qatar Financial Centre to regulate internal business) are issued in Arabic and there are no official translations, therefore for the purposes of drafting this article we have used our own translations and interpreted the same in the context of Qatari regulation and current market practice.
41may 2012
David Harper
marketing
A marketing professional that we know, once told us that a brand name has a personality.
Even now, after all these years, we still think that he was right. That is why trademarks are one of the most important elements of a business.
It is the brand that defines the image of the product or service that you are selling and it is the brand that identifies the package of things which your brand represents. And when you look at the number of brands in this region, branding is becoming ever more important in the marketing game.
Brands are wonderful but it is very hard for us when we watch people throwing their money away by starting to use a brand that someone else can claim right on. We think there must be very few things more
upsetting than having to change a brand after investing in a large marketing spend! Or by spending money promoting a brand but not protecting it – imagine how you would feel if someone else was benefiting from the reputation you were building through a brand and there was nothing you could do to stop them! The only way of ensuring that you can continue to use your brand in the future and that you can stop other people from you using it too, is by developing it yourself and then registering it as soon as you can.
Developing the brandIf you are a clever multitasker, you will probably take on the task of designing your brand and logo yourself, but not all of us are that creative. So we usually have to go and find someone to create that brand and logo for us. If you do this, you need to be careful when putting together the terms that will cover the creation of the brand and logo. Firstly, be sure that the rights to the materials that are created are assigned to your company under a contract that is signed by both parties.
In the previous article, we discussed the legalities of trademarks. Now, Mark Hill and Fiona Robertson, media
lawyers, the rightslawyers, take a look at how brands are created, and can be protected through trademarks.
oN yoUR MARkS!
The way trademarks work around the world, including the Middle East, is that they are registered in one or more of the established 45 classes of goods and services – these classes list every type of product or service you can think of.
42 may 2012
marketing
Too many people omit this vital step yet without it, the person or company that creates the materials will retain ownership of the materials. Simply paying for them under a purchase order will not assign those rights. Secondly, you might want to consider contractually restricting your designer from creating any logo that is similar in design to yours for a set period (or forever if they will agree to that). Whilst this will not stop anyone from copying it, it will contractually allow you to stop the designer from (even inadvertently) taking too much inspiration from your design when creating new ones.
Make sure that your contract contains adequate scope for you to approve designs as you go. Some designers will want to charge extra for a re-design and this can end up becoming a costly exercise.
Which brands should you protect?If you look around at the various trademarks that you come across in a day (remember everyone who sells any kind of product or service uses some kind of trademark), you will see that sometimes they are words only (like for example our brand “therightslawyers”). A registration for these words will mean that no one else could use the mark which includes or is similar to the words “therightslawyers”. You’ll see stylised versions of brands – a registration for this protects the actual way the words are depicted and gives different protection than for the words alone. The final alternative would be a logo, for example the McDonalds “M”, the Starbucks logo with the green circle and so on.
Where?Ok, so next we figure out where you want your brand to be protected and a good starting point is where you sell or plan to sell your products and services. What we usually advise clients is to think about their major brands and your target countries for say the first 9-12 months – that is what you should seek to protect by trade mark registration now. The reason for this is simply that the trade marks process can take a while, particularly if you are doing a number of applications at once.
On timing, even in the fastest jurisdictions around the world and even assuming there are no problems as part of the application process, you will still be looking at six months as a minimum from the date of application.
Ultimately, it will come down to a cost-benefits analysis – where do you want to spend your money?
Which goods and services? So once you know which brands and where, then we need to figure out what for. The way trademarks work around the world, including the Middle East, is that they are registered in one or more of the established 45 classes of goods and services – these classes list every type of product or service you can think of. Basically, whatever business you are in will fall into one or other of the classes. Remember though that you will not get protection for everything simply by submitting an application, you need to be very specific about what you want protection for. That’s why you get different companies using what looks like the same mark but for very different goods or services – POLO is owned separately as a car, a fashion brand and a sweet!
Looking after your brandsIt also never ceases to amaze us how careless some people can be with their
brands! Remember that these things are assets and they need to be looked after just as you would look after a car, a piece of furniture, a bit of machinery and so on.
So what about some tips on how to use them properly?
1. Always use a trademark exactly as it is registered;
2. Always use a trademark as an adjective and never as a noun i.e. talk about a Rolls Royce car rather than a Rolls Royce;
3. Ensure that the trademark stands out from other written material in order to give emphasis to the trademark; and
4. Use the TM and ® symbols properly – TM can be used in relation to an unregistered trademark whereas ® must only be used in relation to registered trade marks.
Fiona RobertsonMark Hill
Always use a trademark as an adjective and never as a noun i.e. talk about a Rolls Royce car rather than a Rolls Royce
therightslawyers is the first and only boutique TMT (Technology Media and Telecommunications) firm set up in the Middle East to cater exclusively for the creative industries, businesses that are driven by or reliant on intellectual property rights (including brand and other IP rights owners, companies facing counterfeiting and IP infringement issues, franchise operations, pharmaceutical and biotech companies, and technology, IT and telecommunications Industries.For more information, please visit www.therightslawyers.com
About
43may 2012
tax
There are two main tax compliance requirements that you may have when you
commence a business in Qatar: • Register with the tax authorities, the Public
Revenues and Taxes Department (PRTD)
• Apply for a tax card
The tax law says that if you are a taxpayer and
you are carrying on a business activity in Qatar then
you should register with the PRTD and submit an
application for a tax card within 30 days of obtaining
commercial registration or the first day of realisation
of income from the activity, whichever happens
earlier. In practice it is prudent to act within 30 days
of obtaining commercial registration even if there
may be a delay before you receive your first income
from the activity. There are penalties for failure to
register and apply for a tax card.
A taxpayer is defined as “a natural or legal
person subject to tax under the provisions of the
law.” This means all individuals and corporate
bodies carrying out a business activity or with a
source of income in Qatar are taxpayers, unless
they are covered by exemptions.
A tax card is usually issued to a taxpayer
that is either resident or has a permanent
establishment (basically a fixed place of business)
in Qatar. The process of obtaining the tax card
tends to be quicker for entities that also have a
commercial registration.
Your first accounting period will start at the
beginning of the tax year (i.e. 1 January) or at the
commencement of activities in Qatar. The duration
of the first period must be a minimum of 6 months
and a maximum of 18 months. Thereafter, each
period will be 12 months in duration. The default
tax year end date is 31 December; however an
application may be made to the PRTD to seek
approval for a different year-end date. This can be
done at the same time as the registration with the
PRTD and the application for a tax card.
Registration with the PRTD and the application
for a tax card should be done by submitting a
request on Form No. 1 – Registration which can be
downloaded from the website of the Ministry of
Economy and Finance
(www.mof.gov.qa/english/tax/index17.html).
Moving forward to Corporate Income Tax
(CIT) compliance obligations, businesses wholly
or partially foreign (non-GCC) owned are subject
to corporate income tax (normally at 10% of net
profits) if they derive income from sources in Qatar.
The compliance obligations for such entities and for
many tax exempt entities are as follows:
File a CIT return
If you are subject to tax in Qatar then you
are required to submit a CIT declaration to the
PRTD within four months of the end of your
accounting period (e.g. by 30 April 2012 for an
accounting period that ends on 31 December
2011). It is permitted to submit an application
to the PRTD to extend the filing deadline based
on reasonable grounds. An application for an
extension should be made 30 days prior to the
expiry of the filing deadline.
The new tax law (Law No. 21 of 2009) was introduced with effect from 1 January 2010 and the executive
regulations for the law were effective from 1 July 2011. Considerable guidance is now available on what
impact the law has for large businesses, but if you run an SME in Qatar then what does it mean for you?
Paul Smith, Partner, Price WaterHouse Cooper, answers some of the key questions that SME’s operating in
Qatar may have about their tax compliance obligations.
GET THE NUMBERS RIGHT
44 may 2012
saleslegal
Pay any CIT liability (if applicable)
The tax required to be paid is based on your
submitted tax return. You should send a payment
order with the CIT declaration.
Comply with audit and accounting requirements:
A. You will be required to submit audited financial
statements signed by a locally registered auditor
together with the tax declaration to the PRTD if:
• the capital of your taxable entity in
Qatar exceed QAR100,000 (approximately
USD 27,300); or
• the annual taxable income of your
entity exceeds QAR 100,000; or
• in the case of a branch, if the head
office is situated outside of Qatar.
The tax law requires accounts to be prepared
in accordance with International Financial
Reporting Standards (IFRS); however you
may make an application to the PRTD to use
another accounting method.
B. There is also a requirement that your tax
return is co-signed by a registered auditor.
This means that in practice the audit is
normally carried out by the same firm that
prepares the tax return.
C. You will also be required to keep and maintain
records and documentation pertaining to your
Qatar activities in the State for a period of ten
years following the end of the taxable year to
which the records and documentation relate.
There are penalties for failure to meet these
compliance requirements.
So what about Withholding Tax (WHT)
compliance obligations? It does exist, if you make
certain payments to non-residents (unless you are
an entity registered in the Qatar Financial Centre).
The new tax law introduced a requirement for all
entities registered in Qatar or with a permanent
establishment in Qatar to withhold a percentage
of certain payments made to non-residents that
do not have a permanent establishment in Qatar.
This means that although the withholding tax
liability falls on the non-resident with activities in
Qatar without a permanent establishment, the
withholding tax compliance requirement is borne
by the Qatar entity.
Circular No. 3/2011 confirmed that the
requirement to withhold applies to all entities
registered in the State of Qatar including
government bodies, public authorities and
corporations. Entities registered in the Qatar
Financial Centre do not have to withhold.
The applicable WHT rates are shown in Table 1
There are also other compliance regulations
such as:
Notification obligation
You will be required to notify the PRTD of any
contracts you enter into if certain conditions are
satisfied.
• For contracts concluded with non-
residents who do not have a PE in
Qatar, the PRTD must be notified
whatever the value of the contract.
A copy of the contract must also be
submitted if its value exceeds QAR
100,000.
• For contracts concluded with residents
or non-residents who have a PE in
Qatar, the PRTD must be notified if
the contract exceeds the following
thresholds:
- Contract of services if it equals or
exceeds QAR 200,000.
- Contracts of construction, supply of
goods and provision of services if they
equal or exceed QAR 500,000.
Moving forward to Corporate Income Tax (CIT) compliance obligations, businesses wholly or partially foreign (non-GCC) owned are subject to corporate income tax (normally at 10% of net profits) if they derive income from sources in Qatar.
WHT applies on such payments to both external
parties or to related parties. There is no WHT on
payments for goods.
If you are making relevant payments to non-
residents without a permanent establishment in
Qatar then your full compliance responsibilities are
as follows:
• Withhold tax, account for it and remit
it to the PRTD before the 16th of the
month following the month during which
the payment was made.
• Complete a WHT statement setting out
the payment and recipient’s details and
submit it to the PRTD in a prescribed
format along with evidence of the WHT
payments.
• Issue and deliver a WHT certificate to the
recipient.
Withholding tax on gross payment
Payment
Royalties and technical fees (i.e. payment is for managerial, consulting or technical services)
Interest, commissions, brokerage fees, director’s fees, attendance fees and payments for any other services carried out wholly or partly in Qatar
5%
7%
Paul Smith
Table 1: Applicable WHT Rates
45may 2012
tax
Paul joined PwC Qatar in September 2010. Prior to moving to PwC Qatar, he worked for over 5 years for KPMG Aberdeen in the UK. During his time at KPMG he worked on corporate tax compliance for many companies operating in the North Sea Oil & Gas sector. In Qatar, Paul has provided tax compliance and consultancy services for clients operating in a range of industries including financial services, oil and gas, manufacturing, construction and telecommunications. Paul can be contacted at paul.smith@qa.pwc.com
About
payments to non-residents that do not have a
permanent establishment in Qatar. See above for
further details on WHT. If you fail to comply with
any of the requirements then you could be subject
to penalties as mentioned in “Table 3.”
In limited circumstances the penalties can be
remitted or reduced. However, the provisions of
the law do not apply to the following:
• Private associations and foundations and
private foundations of public interest.
• Not-for-profit bodies.
• Salaries, wages, and allowances.
• Gross income from legacies and inheritances.
• Qatar Financial Centre entities.
The only exception to this is the withholding
obligation which applies to all bodies other than
those registered in the Qatar Financial Centre.
Category Status of recipient Requirement
1
a) payments to companies resident in qatar Final contract payment should be made upon the
presentation of a valid tax card issued by the prtd. A tax assessment or no objection certificate issued by the prtd is not required.
b) payments to qatari/gcc nationals resident in qatar carrying out activities in their own name (i.e. sole proprietorships)
2
a) branches of foreign entities registered in qatar, the activities of which are not restricted to a fixed period, contract, or project
Final payment should be made upon the presentation of a valid tax card issued by the prtd. A tax assessment or no objection certificate issued by the prtd is not required.
b) branches of foreign entities registered in qatar with activities limited to a contract, project, or a fixed period of at least one year
The higher of the final contract payment or 3% of the contract value (excluding value of supplies and work performed outside qatar) should be retained until the branch produces a no objection certificate issued by the prtd. interim contract payments can be made in full if a tax card is presented.
c) non-residents with no commercial registration in qatar or non-resident entities registered for a contract, project or activity of less than one year
payments would be subject to withholding tax. taxpayers who have a permanent establishment in qatar should submit an application to the prtd to claim a refund of the tax withheld if appropriate.
3 taxpayers registered under qatar Financial centre (“qFc”)
contractual payments should be made upon submission of a valid certificate issued by the relevant QFC authority confirming that the entity is registered in the qFc.
Compliance obligation Penalty for failing to comply (QAR)
register with the prtd and apply for a tax card 5,000
File a cit return within 4 months of the end of the accounting period 100 per day (capped to a maximum of 36,000)
pay any cit liability within 4 months of the end of the accounting period
1.5% of the amount of tax due per month (or part-month) of delay (capped to the amount of tax due)
Prepare audited financial statements (required if the capital or annual taxable income exceeds QAR 100,000 or if the head office is situated outside qatar)
15,000
maintain local accounting records (records must be kept in qatar for 10 years) 15,000
deduct withholding tax from certain payments made to non-residents and remit tax to the prtd by the 16th of the month following the month in which the payment to the non-resident is made
100% of tax not withheld in addition to withholding tax due
retain a proportion of payments made to residents and permanent establishments of non-residents no formal penalty
Notify the PRTD of contracts entered into if certain conditions are satisfied (see below).
Retention requirement
If you are a Qatar resident entity then you may have
a requirement to retain a proportion of payments
made to residents or non-residents who have a PE
in Qatar. Depending on the circumstances of the
recipient, you may not have to retain or if you have
already retained amounts then they can be released
once either a valid tax card or tax clearance certificate
issued by the PRTD has been presented.
The “retention rules” are outlined in Circular No.
2/2011 which was issued by the Ministry of Economy
and Finance on 12 June 2011. The precise operation
of the retention rules depends on the status of the
recipient of the payment as shown in “Table 2.”
Even if your business is wholly owned by Qatari
or GCC nationals you may have CIT and WHT
compliance obligations depending on the nature
of your activities.
CIT compliance
The tax law states that taxpayers carrying out
a tax exempt activity shall submit a tax return
accompanied by audited financial statements.
This is the same information that a taxable
entity is required to submit. Circular No. 4/2011
dated 7 August 2011 confirms that companies
and permanent establishments wholly owned
by Qatari/GCC nationals are required to file
CIT returns (accompanied by audited financial
statements) if they meet one of these conditions:
• Share capital equal to or more than
QAR two million, OR
• Gross revenue equal to or more than
QAR ten million
WHT compliance
Regardless of your ownership, if you are registered
in the State of Qatar then you will have a WHT
compliance obligation if you make certain
tax
Table 2: Retention Requirement
Table 3: Penalties for withholding tax
46 may 2012
country update
The highest population growth in the world was experienced by the four Gulf countries of
Qatar, UAE, Kuwait and Bahrain between 2005 and 2010. Their small indigenous populations, combined with energy wealth, have drawn an influx of foreign labour and developed an attractive consumer market. However, this has led to an economic dependency on expatriates, as demonstrated by the global economic downturn of 2008-2009, which hit local businesses and drove away potential consumers.
Qatar led the population growth worldwide
over 2005-2010, with its population
expanding by 91.7%, followed by the UAE
(82.0%), Kuwait (52.4%) and Bahrain
(36.6%). These states have become attractive
markets, with businesses gaining access to a
spread of consumers, from blue-collar workers
to top-tier executives.
Per capita disposable income is forecast to
increase at an average annual rate of 3.6% from
2012-2020 in real terms.
ECoNoMIC LANdSCAPE
Consumer confidence has declined in
Qatar from levels before the 2008-2009
global economic slow down. Despite having
one of the highest GDPs per capita in the
world at QR332,423 (USD 91,325) in 2011,
consumer expenditure per capita was relatively
low at QR49,898 (USD13,708) due to the
large amounts of wealth being funneled into
government expenditure and the country’s
sovereign wealth fund. However, per capita
consumer expenditure will grow as the economy
diversifies into high-tech and other industries,
and it is forecast to steadily increase to
QR65,959 (USD18,121) by 2020 in real terms.
In 2011, 62.0% of consumer expenditure
was spent on discretionary items (which
is everything except spending on food,
non-alcoholic beverages and housing), up
slightly from 61.6% in 2005. Annual per
capita disposable income stood at QR62,768
(USD17,244) in 2011, ranking it third in the
MENA region. After a 4.9% real decline in per
capita annual disposable income from 2005-
2009, growth improved from 2009-2010 at a
real rate of 6.3%, and it is forecast to increase
at a real average annual rate of 3.8% from
2011-2020. The savings ratio has increased
from 14.6% of disposable income in 2006 to
16.5% in 2011.
Qatar is heavily urbanised, with 95.9% of the
population living in cities in 2011. This provides
easy distribution and service provision for
companies that want to sell cars, electronics and
communications technologies to the country’s
affluent citizens. Wealthy expatriates and visitors
from neighbouring countries may present an even
greater opportunity for retailers of luxury goods,
especially in Doha, which is a prime destination for
shopping due to its many malls.
In common with other markets in the Middle
East and North Africa, Qatar has a young
population compared to OECD countries.
Generation X (those aged 27-39 in 2011) are by
far the biggest consumer group in 2011, totaling
705,300 or 37.2% of the population. They will
continue to be the largest group by 2020, when
they will comprise 36.5% of the population. They
will continue to drive demand for imports, along
with baby boomers (those aged 40-60 in 2011),
who are set to rise from 23.2% of the population
in 2011 to 29.0% in 2020. This increase is
expected to increase demand for leisure and health
care services by 2020.
Qatar has prospered in the last several years with continued high real GDP growth in 2011. Even though
there has been a global slowdown and the region has been gripped with the Arab spring, Qatar has been
able to protect its economy and consumers.
48 may 2012
Partnership opportunitiesPrivate Sector (al kitaa al khass) is an arabic and english magazine, presented and supported by qatar development bank (qdb) and published by cpi. it is aimed at business owners and senior executives in the private sector in qatar. armed with practical advice, it highlights key issues for the business community.
The driving force for regional economies is the private sector – a catalyst for growth, development and job creation. with the world’s spotlight on qatar’s development activities and the buzz being created around 2022, this sector is going to grow by leaps and bounds. that’s great news if you’re targeting the private sector, which spans across almost all industry verticals, but the problem you face is identifying the most dynamic and competitive companies amongst a sea of competitors.
a key answer for the past half decade has been cpi’s uae-based magazine SME Advisor Middle East, which has delivered valuable business information to leading smes across the region, helping them develop their businesses, putting them in touch with valued partners and fuelling growth even in a stalled global economy.
For more information about advertising and other partnership opportunities, please visit www.privatesectorqatar.com/enFor marketing ideas and opportunities, please contact richard@cpidubai.com
now, with the support of qdb as our presenting partner, we have launched the same business values, tailor-made for qatar in the form of the brand Private Sector. this will encompass magazine, events, online and several other initiatives to drive qatari entrepreneurship and the private sector.
This is your chance!this is a market you cannot afford to miss. this is a market that you can reach in an intelligent, focused way, working with the expert team that brought you SME Advisor Middle East and has now launched Private Sector magazine in qatar.
Economic prospects
Qatar was ranked as the most competitive economy
in the Middle East and North Africa (MENA)
in the World Economic Forum’s 2011 Global
Competitiveness Index (GCI). Real GDP growth
was high, at 18.7% from 2010-2011, making it
the second highest growth rate worldwide. Per
capita income in 2012 is expected to be nearly
USD110,000. The non-energy sector grew by
9.5% in 2011; the slowest pace in five years.
This was offset by a rapid increase in exports of
Liquefied Natural Gas (LNG). Growth of real GDP
will moderate in 2012 with real GDP increasing by
6.0% owing to an anticipated drop in energy prices
and the completion of several energy projects.
Qatar has so far avoided the political turmoil
seen in other Arab states in 2011 and maintains a
high level of security, bolstering the confidence of
individuals and companies looking to do business
there. It is considered to have one of the
best economic environments in the region.
Real GDP growth was high, at 18.7% from
2010-2011, making it the second highest growth
rate worldwide. Although Qatar has made some
progress in diversifying the economy, GDP growth
has largely come from the petroleum and gas
sectors, as GDP from mining and quarrying of
energy producing materials accounted for 58.1%
of total GDP in 2011. However, real GDP growth is
expected to cool to 6.0% in 2012 as the economy
remains vulnerable to fluctuations in energy
prices and global demand, and as several energy
projects complete. The economy has suffered from
inflationary instability, as high levels of inflation
above 10.0% from 2006-2008 were followed
by deflation from 2009-2010 when the real
estate market plunged. However, the economy
will experience a more predictable inflation rate
forecast to stabilise at 4.0% in 2012.
The risks of inflation are modest but have risen
after the government introduced a permanent
increase in public sector wages. Prices are forecast
to 4.1% in 2012.
Qatar’s real estate market is recovering after
a period of sluggish growth. Many projects
were delayed during the global financial crisis.
Afterwards, rents and property valuations fell by
25-30% but have begun to rebound. Expatriate
demand for housing finance is also rising. Qatar’s
successful bid to host the 2022 FIFA World Cup
will boost infrastructural spending even more over
the next decade; including several stadiums and
an underground rail system in Doha. In 2011 the
Qatari Finance Minister said that infrastructure
spending would total USD150 billion from
2011-2016, with most of it to be invested in
sectors that are unrelated to oil.
Qatar saw its total population increase by more
than 15% per year between 2003 and 2008. This
huge influx, coupled with the country’s swelling
coffers, is driving public spending on infrastructure.
Current projects involving water, power and
transport are valued at USD 203 billion.
On balance, Qatar’s winning bid for the 2022
FIFA World Cup and the country’s vast oil and
gas wealth will continue to push infrastructural
spending which will further stimulate its economy
and attract foreign direct investment (FDI) inflows.
As a result of the increase in government spending
overall consumer expenditure is expected to grow
by 3.7% in real value terms by 2013. Hence Qatar,
as per the World Economic Forum’s 2011-2012
Global Competitiveness Index (GCI), is expected to
maintain its high ranking as the most competitive
economy in the Middle East and North Africa.
0
2
4
6
8
10
Source: Euromonitor International from national statistics/UN
Popu
latio
n, M
illio
ns
Table1: Population growth
Source: Euromonitor International from National statistical offices/OECD/Eurostat
2000 2005 2010 2015 20200
5000
10000
15000
20000
Other goods & services
Housing
Food and non-alcoholic beverages
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
United Arab Emirates Kuwait Qatar Bahrain
Note: (1) Data for all years is in fixed constant US$; 2015 and 2020 data refer to forecasts. (2) Other goods and services refers to consumer expenditure on Alcoholic Beverages and Tobacco, Clothing and Footwear, Household Goods and Services, Health Goods and Medical Services, Transport, Communications, Leisure and Recreation, Education, Hotels and Catering and Miscellaneous Goods and Services
country update
Euromonitor International is the world’s leading provider of global business intelligence and strategic market analysis. We have 40 years’ experience of publishing market reports, business reference books, bespoke consulting projects and integrated online database Passport.Our research offers insight into industries, countries and consumers. We deliver quality information solutions to support strategic business planning.Euromonitor International is headquartered in London, with regional offices in Bangalore, Cape Town, Chicago, Dubai, Santiago de Chile, Shanghai, Singapore, Sydney, Tokyo and Vilnius and has a network of over 800 analysts worldwide.
About
50 may 2012
Established in 1964, UNCTAD promotes the development-friendly integration of developing countries
into the world economy. UNCTAD has progressively evolved into an authoritative knowledge-based institution whose work aims to help shape current policy debates and thinking on development, with a particular focus on ensuring that domestic policies and international action are mutually supportive in bringing about sustainable development.
The World Investment Forum (WIF) was also
held as part of the UNCTAD XIII from 21-23
April. The Forum witnessed the launch of revised
Guidelines for International Investment , by the
FoSTERING INCLUSIvE dEvELoPMENTThe thirteenth session of the United Nations Conference on Trade
and Development (UNCTAD XIII) was held from 21 to 26 April 2012
at the Qatar National Convention Centre. Private Sector brings you a
snapshot of the exciting discussions.
International Chamber of Commerce (ICC) to
adapt to new challenges of the international
investment environment and to further promote
investment as a driver of economic growth.
While the value of cross-border direct
investment has grown substantially in the past
decade, international investors have reason
to be concerned about the impact of recent
developments and policies on the free flow of
international investment.
“Investment underpins economic growth and
has shared value for companies and governments
alike,” said Peter Brabeck-Letmathe, Chairman
of the Board for Nestle. “It allows companies
to establish themselves in global markets and
creates ties between domestic and foreign
companies, allowing them to expand their
activities and create new jobs.”
The aim is for the Guidelines to facilitate cross-
border investment for investors and governments,
as well as to harness the vast potential of cross-
border investment for stimulating balanced global
growth. Trade and investment have the potential
to reinvigorate the global economy during the
present economic crisis, particularly by driving
sustainable growth in developing countries.
There has been a sharp increase, since the
original Guidelines were drafted in 1972, in
international investment inflows to, and outflows
from, developing and transition economies. In 2010,
these accounted for 52% of the total investment
inflows and 29% of total investment outflows.
Global inward investment flows now approach
USD 1.2 trillion and sales of affiliates worldwide
are just under USD 30 trillion, far in excess of
world trade flows. There are also more than
2,800 bilateral investment treaties, many of them
south-south.
about town
High level discussion on women in development
52 may 2012
Another highlight of the conference was that
HE Dr Hamad bin Abdulaziz Al Kawari, Minister
of Culture, Arts and Heritage, was elected
President of the Conference of UNCTAD XIII.
Qatar has officially taken over the presidency of
UNCTAD for the next four years, becoming the
country in the Arab region to preside over the
organisation since its inception in 1964.
Emphasising on the role of women in the
present day world, there was also a panel
discussion the development of women. Her
Excellency, Sheikha Al Mayyasa bint Hamad bin
Khalifa Al-Thani, who inaugurated the high-level
event, said that under the leadership of Her
Highness is Sheikha Moza bint Nasser on this
issue “Qatar will spare no effort in helping more
women to achieve this goal.”
His Excellency Dr. Hamad bin Abdulaziz
Al-Kawari, Qatar’s Minister of Culture, Arts
and Heritage, in his role as President of the
Conference, who opened the event said
that, “We believe that development is only
meaningful where there is a role for women.”
He added, “Without the involvement of women,
development would be a lame duck.”
Sheikha Al Mayyasa acknowledged the “special
importance” that the issue of women has for the
work of UNCTAD. She added that the leadership in
Qatar also sees it as a “cornerstone of development”.
The Director General of the World Trade
Organisation, Pascal Lamy, outlined the necessary
steps to facilitate greater inter-Arab region trade.
The event brought together leading economists
and prominent members of the region’s business
community to consider what lessons had been
learned from the Arab Spring.
The Director General acknowledged the
“timeliness” and “critical nature” of the
discussion. He said: “The Arab Spring reminds
us of one fundamental economic viable –
unemployment remains a major social, economic
and political challenge”.
Noting that Arab states have “lagged behind”
the rest of the world in employment levels for the
last two decades, he said the lack of capacity to
export locally produced goods and materials is an
imperative concern that needs to be addressed.
In his conclusion, Pascal Lamy called for
private sector driven processes to shape trade
policies, the reduction of bureaucracy as
an obstacle to free-trade, and the efficient
administration of trade through national
development policies.
While talking about development,
technology cannot be ignored. An innovation
and technology day was held to discuss the
importance of technology and innovation for
achieving faster economic growth and advancing
sustainable human development. The session also
explored how policies could be improved to make
innovation and technology a more powerful lever
for development.
In his opening remarks, His Excellency Dr.
Supachai Panitchpakdi, Secretary-General of
UNCTAD, said; “It is a pleasure to be hosting
the first ever innovation and technology
day during an UNCTAD ministerial meeting.
This has been made possible by the Qatar
Foundation and we hope this is the first step
towards an ongoing partnership.” Dr. Tidu
Maini, Executive Chairman of Qatar Science
and Technology Park, and Science and
Technology Advisor to the Qatar Foundation,
thanked UNCTAD for choosing to host its
conference in Doha.
He said, “We believe education, research and
innovation are key drivers for the diversification of
Qatar’s economy into a knowledge-base”.
In her keynote speech, Her Excellency Ms. Tarja
Karina Halonen, Former President of the Republic
of Finland, said the transformation that has taken
place in Qatar over the last 20 years is “amazing”.
As part of the conference, TASDEER in
collaboration with UNCTAD organised a
workshop on Generalized System of Preferences
(GSP). The workshop was chaired by Mr Hassan
Khalifa Al Mansoori, Executive Director, TASDEER.
The workshop was focused on enabling
participants reach reliable information on the
aspects of GSP schemes of European Union,
Canada and Turkey. It included coverage on
various topics, such as product coverage, GSP
rates, origin criteria, consignment conditions and
documentary evidence. The workshop included
presentations by Mr Taisuke, ITO and Ms Michiko
Hayashi from UNCTAD.
The UNCTAD XIII reinforced the importance
of holistic and sustainable development of the
region and the world that must be at the centre
of the globalisation process.
saleslegalabout town
TASDEER workshop on Generalised System of Preferences (GSP)
53may 2012
Using data from an online survey carried out by Bayt.com and YouGov Siraj with more than
12,000 residents of 18 Arab countries, Stanford University’s Programme on Arab Reform and Democracy finds that despite the many institutional and structural obstacles social entrepreneurs face, there is a strong foundation for social entrepreneurship in the Arab region. Key findings include:
• There is a strong interest in volunteerism
—more than one in four respondents
region wide is currently active in some form
of volunteering — indicating a greater
involvement in social causes, a pathway
towards social entrepreneurship.
• In every country surveyed a large proportion of
respondents indicated that if given the choice
they would prefer to be self-employed or
own a business. While many cited the greater
independence it would offer, other business
owners started their initiatives out of economic
necessity not opportunity.
• Roughly half of respondents across the region
are at least somewhat familiar with the term
entrepreneurship — in both its business and
social senses —indicating growing awareness
of this emergent sector.
• A significant proportion of respondents
expressed interest in entrepreneurship as a
profession pointing to a high potential for
growth in this sector.
• The majority of respondents in every country
stated that their personal economic situation
has deteriorated as a result of the Arab Spring,
suggesting that social entrepreneurship may
emerge as an alternative sector for the region’s
unemployed youth.
• Across the region, the majority of respondents
believe that young people are more interested
in improving their communities and
contributing to the long-term development
of their societies after the revolutions. These
changing attitudes and practices suggest the
emergence of a new generation of social
entrepreneurs across the Arab region.
industry watch
In light of the opportunities suggested
above, the survey revealed significant structural
and cultural barriers in place that prevent
the ecosystem of entrepreneurship from fully
thriving in the region. Overall respondents
indicated very high rates of failure of new
businesses and NGOs. Lack of finance remains
the largest challenge to starting a business,
while bureaucratic hurdles such as legal
registration and interference from authorities
were cited by those operating in the NGO
sector. The paper proposes the following
recommendations to address these challenges
and further encourage social entrepreneurship:
• Increase the number of social entrepreneur
incubators and support local organisations in
incubating entrepreneurship;
• Assist local organisations in reforming the
legal and regulatory framework;
• Use media tools to educate Arab societies
about entrepreneurship;
• Introduce entrepreneurial education in
schools and universities;
• Encourage partnerships between the public,
private and NGO communities in Arab
countries that identify, support, and celebrate
entrepreneurs across the region;
• Widen participation in initiatives run by
the international development community
to involve multiple stakeholders, with
an emphasis on women and those from
disadvantaged backgrounds;
• Enhance the social accountability of social
entrepreneurs’ projects.
WINdS oF CHANGEThe Arab Spring has negatively affected the economies of many
Arab countries, while also inspiring citizens to actively participate in
bringing about social change and community development. Social
entrepreneurship is often suggested as a way to combat unemployment
and engage citizens in improving their local communities, both of which
are urgently needed in the post-Arab Spring era.
0 10 20 30 40 50 60 70 80
TotalBahrain
LebanonJordan
SyriaKuwait
EgyptSaudi Arabia
UAEMorocco
Oman TunisiaQatar
Algeria
Respondents interested in Private Sector, by country (%)
54 may 2012
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