GRM 2010 GRM 2011

Abstract Details

Family Name:
First Name:
Abdul Ghaffar
Title of Paper:
Paper Proposal Text :
The twin goals of Qatarization and creating a knowledge-based economy are enshrined in Qatar’s national vision (QNV 2030). While nationalization of the labor force in the ‘expat’-dominated private sector has long been the avowed goal of the resource-rich Gulf States, the trend in Qatar has so far consistently evaded the stated vision. As for progress towards creating a knowledge-based society, it is unclear whether Qatar is moving fast enough to realize this goal by the target date of 2030. We believe this situation is due mainly to both structural conditions as well as government policies.

The vast oil and gas resources of the Gulf States have enabled them to tap into the relatively unlimited supply of cheap labor from South and South East Asia to enjoy dramatic improvement in the living conditions of the native population over the last few decades. These natural resources will one day run out, or, will cease to generate the kinds of rents that have underpinned the transformation in the living conditions in these countries. The question is whether these countries will be able to sustain their growth once their oil and gas reserves dry up, or, if a black swan type event (e.g. the whole world suddenly turning into a vast Copenhagen) causes dramatic shifts in supply/demand conditions. In case of Qatar, we can ask a more specific question: will Qatar be able to realize / continue to make progress towards the goal of creating knowledge based advanced economy when it is no longer able to rely upon the natural-resource generated rents? The question can be answered in the affirmative if radical changes take place at both the individual and the societal levels. The present paper focuses upon one such transformation in Qatar, i.e., transformation of the migration regime prevalent in the country. In other words, the research question is: what kind of reforms in the current migration regime will it take Qatar to be able to overcome the adverse effects of a demand / supply shock in the foreseeable future?

This question has always been of concern to natural resource-rich economies as these are highly prone to the so-called ‘resource curse’: the Dutch disease due to changing terms of trade, wasteful subsidies to buy off political support, misallocation of resources, lack of institutional capacity, rent-seeking activities, lack of political representation, and internal conflicts. However, it has acquired added significance in light of the recent oil and gas shock that has called into question the sustainability of the existing economic paradigm. It has served as a wake-up call for both the government and the citizens of the rentier states of the Gulf: it has prompted the GCC governments to consider introducing VAT of 5% for the first time in their history; and it has induced fresh graduates, who were hitherto guaranteed jobs with huge perks in the public sector, to consider employment in the private sector.

The skills deficit of the Qatari economy is well documented. We believe that the lack of consistency and rigor in addressing Qatar’s skills deficit is born out of complacency due to a combination of factors. These include: (1) phenomenal national economic growth, which vast oil and gas resources in Qatar have made possible, combined with (2) visible improvements in the standard of living among the national population, and (3) a relatively unlimited supply of cheap labor from the surplus labor economies of South and Southeast Asia coupled with (4) the unique Kafalah or sponsorship system.

There are two main objectives of the study. The first objective is to conduct an in-depth analysis of the labor market strategies of two city states that rely heavily on foreign labor in order to draw lessons that might help Qatar in meeting the huge human resource challenges it faces. The second objective is to propose reforms in the migration ‎regime with a view to tailoring it to the goal of creating an advanced knowledge-based economy. ‎

We use a comparative case study design and employ a mixed method approach to investigate the issue. Both resource-rich and resource-poor small advanced city states may hold important lessons (positive or negative) for Qatar to draw upon. Secondary data analysis will be supplemented by semi-structured interviews with key stakeholders. Singapore is considered to be a living story of a resource poor country outperforming many a resource-rich country, and may hold important lessons for an aspiring knowledge-based society that Qatar is. While there are differences of culture, ethnicity, and political system, the defining and critical difference between the two for the present study is the vast natural wealth of Qatar compared with Singapore. As a resource-rich country, UAE may serve as a good case to compare with Qatar. In contrast with Singapore, the Emirates shares with Qatar similar history, culture, resource endowments, and initial conditions. However, what makes a comparison between Qatar and UAE significant and policy relevant is the fact that they compete with each other in many fields, including sports staging facilities, civic aviation, and education hubs.

To our knowledge, there has been no comparative study of the three city states under consideration with the above objectives. The proposed research seeks (a) to contribute to the literature on the economics of migration to the Gulf, and (b) to make policy recommendations to reform the migration regime in order to address the knowledge and skill deficit in Qatar.