PESTEL analysis of Qatar (Qatar country profile)
This is a comprehensive PESTEL analysis of Qatar (Qatar country profile). It examines how the country is affected by the macro-environment factors and the strategies it has developed to seize opportunities and confront challenges. Qatar is officially known as the State of Qatar. It has been ruled by the House of Thani for a long time.
Political factors and their impact on Qatar
Qatar is a small country in the Middle East. However, its influence goes well beyond the national border. It often works on mitigating the differences between differing sides in the Middle East and beyond. It is a close ally of the United States of America, China, and Turkey. It has co-operation agreement with Iran as well.
Qatar was boycotted by Saudi Arabia, UAE, Bahrain, and Egypt in 2017. However, a normalisation tune was adopted by the boycotting sides in early 2021 and significant steps were taken to reopen the land, sea and air corridors for the movement of people and goods to and from Qatar.
Qatar often hosts international events and conferences on education, economy, religion, and politics. It has raised its profile in the international arena and is considered a middle power. It is a member of the UN, OPEC, GCC, the Arab League, OIC, and many other international institutions. However, according to Amnesty International (2021) freedom of expression is restricted in the country.
Economic factors and their impact on Qatar
In 2020, Qatar’s GDP was worth around $146.37 billion which is lot less than that in 2019. This shows the impact of global lockdowns on the country’s economy. However, the GDP is forecast to increase and reach $195.00 Billion by the end of 2022 due to the expected rise in gas production and investment for the 2022 World Cup football (Trading Economics, 2021).
Petroleum gas, crude petroleum, refined petroleum, ethylene polymers, and nitrogenous fertilisers are some of the top exports of Qatar that mostly go to countries such as Japan, South Korea, India, China, and Singapore. On the other hand, its top imports are aircrafts, spacecrafts, gas tribunes, iron pipes, and jewellery that come mostly from the USA, the UK, China, and Germany (OEC, 2021).
Qatar is one of the richest countries in the world. In fact, it is the richest one with a GNI (Gross National Income) per capita of $116,799 (Suneson, 2021). The unemployment rate in the country is 0.2% which is one of the lowest in the world.
The oil reserve in Qatar is massive and equal to 13% of the global supply. Other industries such as tourism and hospitality, Islamic finance, fertilizer production, agriculture, and fisheries are rapidly growing as well. However, its low-cost dominance in liquefied natural gas (LNG) export is now challenged by Australia, the USA, Egypt, and Mozambique (World Bank, 2020).
Social factors and their impact on Qatar
Qatar is a small country with a total population of around 2.9 million (Worldometer, 2021). Interestingly, Qataris are considered a ‘minority’ in their own nation with a representation of only 15% of the total population. Other significant nationalities living in the country are Arab, Indian, Filipino, Nepali, Bangladeshi, Egyptian, and Sri Lankan.
Qatar has set an aim to become the most open nation in the Gulf. It is broadly a tolerant country. Islam is the major religion with around 86% adherents. Other notable religions are Christianity and Hinduism. Arabic is the official language while English is widely spoken as well.
Qatar is a very good country to work and live where it is usually easy to make friends. Cultural and tourism attractions are developing rapidly. The country has a relaxed work culture and a low crime rate. It offers high salaries as well. However, the division of class, and high cost of living are two significant social problems in the country.
Technological factors and their impact on Qatar
Technological environment is the next element to discuss in the PESTEL analysis of Qatar (Qatar country profile). There is no doubt that Qatar is one of the top countries in the world that has accepted and adapted new technologies. It decided long ago to diversify its economy. As a result, the energy-based economy is gradually shifting focus towards a tech and knowledge-based one.
The domestic IT market is growing rapidly. Approximately 99% of the population use social media. Facebook, Instagram, Twitter, Snap Chat, and LinkedIn are the most used social media platforms. The government is also very keen on investing in technology. However, developing and nurturing a local talent pool is a challenge for the country.
Environmental factors and their impact on Qatar
Qatar has recently focused heavily on tourism particularly in response to the blockade imposed by Saudi Arabia, Bahrain, Egypt, and UAE. The industry is developing rapidly drawing attention of the international tourists. A massive number of tourist attractions have been built that coupled with natural attractions, have increased the appeals of the country to both local and international tourists.
However, Qatar has several environmental challenges to deal with. For instance, it is one of the hottest places on Earth. In fact, the temperature is high that it had to install air conditioning in the open air including in streets and outdoor markets (Dalton, 2019). Other environmental challenges are sandstorms, ocean acidification, and pollution (air and water).
Legal factors and their impact on Qatar
Legal environment is the last element to discuss in the PESTEL analysis of Qatar (Qatar country profile). The legal system in the country combines both civil law and Islamic law. The Labour Law ensures employees’ rights and welfare. 48 hours is the maximum number of hours in a work week excluding breaks; however, during the fasting month (Ramadan) the number is reduced to 36 hours per week (Qatar Labour Law, 2021).
However, it should be mentioned that there is no minimum wage in Qatar. Likewise, lack of freedom of expression, safety of migrant workers in construction industry, and limited rights of domestic workers have raised concerns and drawn criticisms from different human rights groups.
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Last update: 19 July 2021
Amnesty International (2021) Qatar 2020, available at: https://www.amnesty.org/en/countries/middle-east-and-north-africa/qatar/report-qatar/ (accessed 18 July 2021)
Dalton, J. (2019) Qatar now so hot it has started air-conditioning the outdoors, available at: https://www.independent.co.uk/climate-change/news/qatar-air-conditioning-temperature-weather-heat-climate-change-athletics-world-cup-a9160751.html (accessed 19 July 2021)
OEC (2021) Qatar, available at: https://oec.world/en/profile/country/qat (accessed 17 July 2021)
Qatar Labour Law (2021) Welcome to Qatar Labor Law, available at: https://qatarlaborlaw.com/ (accessed 19 July 2021)
Suneson, G. (2021) These are the 25 richest countries in the world, available at: https://eu.usatoday.com/story/money/2019/07/07/richest-countries-in-the-world/39630693/ (accessed 17 July 2021)
Trading Economics (2021) Qatar GDP, available at: https://tradingeconomics.com/qatar/gdp (accessed 15 July 2021)
Worldometer (2021) Qatar population, available at: https://www.worldometers.info/world-population/qatar-population/ (accessed 18 July 2021)
World Bank (2020) Qatar’s Economic Update — April 2020, available at: https://www.worldbank.org/en/country/gcc/publication/qatar-economic-update-april-2020 (16 July 2021)
Author: M Rahman
M Rahman writes extensively online and offline with an emphasis on business management, marketing, and tourism. He is a lecturer in Management and Marketing. He holds an MSc in Tourism & Hospitality from the University of Sunderland. Also, graduated from Leeds Metropolitan University with a BA in Business & Management Studies and completed a DTLLS (Diploma in Teaching in the Life-Long Learning Sector) from London South Bank University.