Authored by – Alexander Cavendish, CEO, Hedonova, a US based Hedge Fund
Like every other Middle Eastern nation, Qatar was also heavily dependent on oil and natural gas, among other traditional investment avenues for earning most of its revenue and investments. However, in recent years there has been a shift in investor preferences towards alternative investments, especially after Qatar hosted the world-famous FIFA World Cup in 2022. Alternative or alternate investments are non-traditional investments unrelated to the traditional market landscape. They offer investors the benefits of diversification, a high return potential, and risk mitigation against traditional market volatility. Hedonova projects that Qatar, with the fourth-highest GDP in the world, is seeing a significant increase in alternate investments because the government is also enabling such investments by making regulatory reforms, funding infrastructural projects, giving tax incentives, and taking other measures to encourage domestic and foreign investors to invest in alternate investments. Here are Hedonova’s predictions on the changing landscape of alternate investments in Qatar and favorable assets for investors.
Rising alternate investments in Qatar – Hedonova’s forecasts
Real estate is one of the most promising alternate investments in Qatar. Many High Net Worth Individuals (HNWIs) are estimated to spend over 1 million$ on real estate investments in 2023, especially in sustainable, luxurious, and innovative cities like Lusail. However, Hedonova has made real estate investment more accessible for non-HNWIs enabling interested investors to invest with a sum as minimal as 5000$.
Because Qatar is abundant in natural energy resources like the sun and wind, it is making headway for ambitious sustainable infrastructural projects with energy-efficient, water-conserving, and smart-tech-enabled installations that are driving up the market value of such structures. These infrastructural developments are attracting many foreign investors because they improve the chances of earning maximized long-term revenue.
Private equity investments are also becoming a lucrative investment opportunity for investors. They offer investors the scope for extremely high returns and are appropriate for those with a long investment horizon and high-risk appetite. However, with the law reform in the Foreign Investment Law that now enables non-Qatari investors to own up to 100% of their assets, private equity is becoming all the more beneficial for investors of alternate assets.
Qatari government initiatives to make alternate investments more accessible
According to Hedonova’s data insights, many other alternate investments are contributing to the changing investment landscape in Qatar. These include start-ups/ venture capital, private debt, hedge funds, Islamic Financial products, art & collectibles, and cryptocurrencies, among others. The Qatari government is also making various regulatory and financial changes to make alternate investments more accessible for an entire spectrum of investors. These steps include:
- Improving regulatory and legal reforms to remove the hurdles of domestic and international investing
- Setting up helpful organizations like the Qatar Financial Centre and the Qatar Investment Promotion Agency to simplify and incentivize the investment journey for investors, investees, and financial institutions alike
- Supporting the growth of promising start-ups, accelerators, and early-stage companies to boost investment
- Funding infrastructure projects and creating job opportunities as a positive consequence
- Raising national and global investor awareness through educational, outreach, and conferencing efforts
Despite the rise of alternate investments in booming global economies like Qatar, it is always wise to consult a certified financial advisor like Hedonova that can give you clear insights on how to identify and navigate lucrative alternate investments.