How new laws, football and transformational projects are influencing the construction sector in Qatar
In this update, we provide an overview of the challenges and opportunities for the sector.
Legal Developments
Emiri Decision No 28 of 2023 establishing the general authority for regulating the real estate sector
Qatar’s real estate sector is set to undergo changes with the establishment of a new public authority. Some of the objectives of this authority are:
- launching a real estate platform to provide data and information to individuals and investors;
- encouraging investment in the real estate sector through incentive policies and procedures;
- issuing licences, supervising activities and protecting property transactions;
- tracking financing, controlling procedures and governing to protect real estate transactions;
- establishing the Real Estate Licensing Committee to oversee real estate development;
- enforcing rules to hold developers accountable for delivering units on time and as per contracts;
- limiting developers to working on up to three projects simultaneously to ensure quality; and
- regulating real estate companies to prevent excessive charges to clients.
This change is expected to lead to a more organised and transparent market, particularly providing better information on investments through the real estate platform in order to enable investors to make informed decisions.
Law No. 17 of 2020 on the non-discriminatory minimum wage and removing the no-objection certificate
This new legislation implemented a statutory minimum wage for workers in the private sector, including domestic workers. It also removed the requirement for non-Qatari citizens to obtain a No-Objection Certificate ('NOC') from their sponsor to be able to change employers. The NOC has been an imperative component of Qatar's sponsorship framework applicable to foreign workers.
The immediate impacts included:
- employers had to review their salary and benefit structures to ensure that they comply with the statutory minimum requirements;
- the labour market experienced greater competition since employees can change employers easily; and
- the cost to contractors of undertaking the work increased.
Decision of the Minister of Administrative Development, Labour and Social Affairs No. 17/ 2021
This Decision affects the construction industry on an annual basis by prohibiting the performance of work outdoors and in the sun from 10:00 am to 3:30 pm daily, between June 1 and September 15 every year, except from employees working in oil and gas industry. Employers are also obliged to stop works where the Wet Bulb Globe Temperature (WBGT) index rises higher than 32.1 degrees, regardless of the time.
National projects
FIFA World Cup Qatar 2022
Hosting the FIFA World Cup 2022 resulted in significant opportunities for the Qatari construction industry, creating a large scale of new infrastructure opportunities. However, on completion of the World Cup, the industry suffered from the lack of new projects and a related decrease in demand for jobs in the industry. Notwithstanding these challenges, Qatar's recent long-term aims and plans are expected to significantly grow the construction sector as a result of the industry's key contribution in the achievement of the plans.
Qatar's National Vision 2030
The government plans to spend US$200.0 billion on the development of transport infrastructure, energy, healthcare and educational infrastructure by 2030. Examples of government-led initiatives and investments in infrastructure include:
- QatarEnergy and Ashgal are collaborating to reduce the carbon footprint of the country’s Liquefied Natural Gas ('LNG') production by expanding its solar capacity.
- In 2022, ExxonMobil and QatarEnergy announced their agreement to further develop Qatar’s North Field East project, which aims is to expand the LNG capacity from 77 million tons to 110 million tons by 2026.
- Ashghal has published its 2023 plan which encompasses various construction projects. In 2023, 22 building projects, valued at approximately QAR4.1 billion were tendered. It further revealed the ongoing implementation of approximately 10 projects, with a total value surpassing QR3 billion. Another package of projects is scheduled for launch in the summer of 2023.
Transportation Master Plan for Qatar 2050
The 2050 Plan is a roadmap for investing in land transportation infrastructure and identifies the framework for developing the transportation networks nationwide in a way that ensures their integration with land uses, urban development, population growth and meeting the future demand for transportation.
The construction sector will contribute largely to the delivery of key components of this Plan, including the 37 proposed projects to develop the main road network, 30 projects to develop the main public transit network and expanding the building of the facilities that support the transition to sustainable transportation.
Asian Games 2030
Qatar’s vision extends toward creating facilities that can be repurposed and utilised for various purposes in the long term. This strategic approach ensures that the investments made will continue to benefit the country and its residents well beyond the conclusion of these sporting events.
The construction industry is expected to increasingly generate employment opportunities, stimulate local businesses and attract foreign investment. The long-term benefits extend beyond the immediate construction phase, creating a sustainable economic ecosystem that supports growth and diversification.
