Qatar’s National Vision 2030 sets out the goal of achieving sustainable and diversified economic growth through the establishment of a knowledge-based economy, relying in part on the efforts of entrepreneurs. To date, Qatar’s economy remains dependent on its revenues from oil and natural gas. With crude oil prices falling to below $50 a barrel, the importance of pushing for this agenda has become more apparent.
Qatar has the highest prevalence of entrepreneurial activity among innovation-driven, or advanced, economies – suggesting a high potential for economic diversification driven by entrepreneurial activity.
This entrepreneurial activity is driven in large measure by entrepreneurs who have recognized a business opportunity rather than starting up their own business out of necessity. This entrepreneurial activity does not however translate into high rates of established business ownership, an important measure of the financial viability of these businesses.
Common causes cited for discontinuing a business are that the business was not profitable, that rent was too high, and that finance was not available. Fewer respondents cited an opportunity to sell the business or a pre-planned exit as reasons for business discontinuance.
Entrepreneurial activity was most prevalent among Qatari males with postgraduate experience. Among foreigners, entrepreneurial activity was most prevalent among non-Qatari males with only some secondary education. With the workforce comprising mostly foreign workers, the survey suggests that current entrepreneurial activity is not focused on high value-added economic activities.
Qatar also benefits from the highest rate of “intrapreneurship” (entrepreneurial activity by employees within companies) among countries surveyed by GEM in 2014. Intrapreneurship measures employee involvement in the development of new activities on behalf of their employers. Intrapreneurship is a driver of growth and productivity for innovation driven, or advanced, economies.
Unlike with traditional entrepreneurial activity, the prevalence of intrapreneurship among foreign workers is highest among those with a postgraduate degree, suggesting an important avenue for economic diversification and the establishment of high value-added economic activities.
The National Experts Survey finds that there is insufficient equity and VC funding for new and growing firms, and that government bureaucracy, regulations and licensing requirements make doing business in Qatar unduly difficult. These findings are broadly in line with the 2015 Global Competitiveness Report and the 2015 Doing Business rankings which also report underperformance in these areas, despite impressive rankings in other indicators.