KEY TRENDS IN QATAR OVER THE NEXT 36 MONTHS - AN

S E C R E T DOHA 000205


DHAKA FOR POL/ECON, DEPARTMENT FOR DS AND DSS

E.O. 12958: DECL: 03/24/2019
TAGS: AMGT ASEC ECON KSPR PREL QA
SUBJECT: KEY TRENDS IN QATAR OVER THE NEXT 36 MONTHS - AN
UPDATE

REF: A. 2008 DOHA 664

B. DOHA 140

Classified By: Ambassador Joseph E. LeBaron for reasons 1.4 (b and d).


1. (C) Embassy Doha's second interagency off-site was held
March 3, 2009 at CENTCOM Forward HQ at Camp As-Saliyah (see
ref A). This was the second such off-site (see ref B).
These interagency off-sites will be held twice yearly, with
the objective of reviewing and updating our field interagency
assessment of key trends in Qatar over the coming 36 months.
Specifically, the interagency team focused on:

-- The most important trends with greatest implications for
U.S. national interests in Qatar.
-- Our expectations for those trends over the next 36 months.
-- Whether these expectations have changed since
establishment of the Mission's first field interagency
assessment in September 2008.


2. (C) The off-site concluded with a discussion of the USG
policy imperatives which flow from these trends, and a look
at mechanisms for interagency synchronization to most
effectively pursue those policy imperatives. This cable
presents Embassy Doha's updated analysis of key trends in
Qatar. A discussion of policy imperatives and mechanisms for
interagency synchronization will be discussed in a separate,
classified Interagency Field Synchronization Plan.

--------------
POLITICAL AND DIPLOMATIC TRENDS
--------------


3. (C) A review and update of Qatar's political and
diplomatic trends reveals the following:

-- (C) The uncontested domination of Qatari politics by the
Al Thani family will continue through the next 36 months.
Though we have little detailed knowledge of the internal
workings of the family, it appears that the rule of the
current Amir Sheikh Hamad bin Khalifa Al Thani is secure (his
health notwithstanding). We expect a smooth transition in
power to his son after his passing, based on what we know
today.

-- (C) All critical decisions in the country, whether
political, legal, or economic, continue to be made by a tight
circle of Al Thani family members. So intertwined are the Al
Thanis with the fiber of the nation that it may be said that
the fate of Qatar is the fate of the Al Thanis and their
rule. The twin roles that personality and risk play in the
creation and execution of Qatar's foreign and domestic
policies will continue to be dominant.

-- (C) Al Jazeera Satellite Television Network will continue
to be an instrument of Qatari influence, and continue to be
an expression, however uncoordinated, of the nation's foreign
policy. Qatar has continued efforts to mend political fences
damaged by Al Jazeera's broadcasts, for example with the
November 2008 visit of Jordanian King Abdullah. Those
efforts will continue.

-- (C) Qatar will continue to position itself as a mediator
to secure the regional diplomatic role the Al Thanis crave.
It will do so not just for reasons of pride and ego, but in
order to reduce instability in the region on the assumption
that political and economic instability is especially
threatening to tiny states such as Qatar.

-- (C) The Amir and a small circle of family members making
all the major decisions in the country will continue their
demonstrated commitment to the rule of law and to more
participatory government. Qatar will continue its slow march
toward a more participatory Qatari society, restrained by
concerns that more democracy may put a brake on the Amir's
progressive agenda. GOQ sources say that Advisory Council
elections may be held as early as mid-2010. The Permanent
Elections Committee will continue to accept technical
training from NGOs, including U.S. organizations.

-- (C) Qatar will continue to rely heavily on foreign labor.
Because they are so outnumbered by foreigners, Qataris will
continue to regard foreign workers as a security, rather than
a human rights, concern. Qatar will seek workers from
countries currently under-represented in their expatriate
labor pool in order to avoid being grossly outnumbered by one
nationality, such as Indians.

-- (C) The Qataris themselves will continue to experience
alienation in the face of cascading change. The increase in
the Qatari population has come largely from societies with
different religious, linguistic, and cultural norms than
Qatar. They tend to be Hindu or Buddhist, and few speak
Arabic. Gross economic disparities will lead to a mammoth
increase in the currently low crime rate.

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MILITARY TRENDS
--------------


4. (C) A review and update of Qatar's military trends and
expectations reveals the following:

DEVELOPMENT OF QATAR'S MILITARY

-- (C) Qatar's goal of creating a professional military force
will remain a challenge. Losses through retirement in the
senior ranks will be compounded by the difficulties the GOQ
faces in grooming junior Qatari officers to assume
leadership. Qatar continues to rely on third-country
nationals, particularly in the enlisted ranks, and the
possibility that sensitive U.S. military information will be
compromised will continue to cause concern in our bilateral
military relationship.

-- (C) The Qatari military will continue to seek foreign
sources of professional military training and education.
(Rebuffed by the U.S. Military Academy, Qatar now plans to
cooperate with the French school, St. Cyr, to create a
military academy in Qatar. Junior officers will begin
military training in the U.S. next month.)

-- (C) Due to the global economic crisis, Qatar may extend
its timelines for acquisition of defense equipment, including
U.S. defense sales. The Qatari military is delaying its
purchase of 17 weapon systems that they had earlier sought to
purchase. While the C17 and C103J purchases are still on
track, the GOQ is delaying the purchase of helicopters and
other defense items.

-- (C) Although Qatar will continue to express a preference
for many U.S. defense systems, the Qatari military will
continue to find frustrating the U.S. system of foreign
military sales (FMS). The requirement of congressional
notification and reduced access to sensitive technology will
discourage the Qataris from purchasing U.S. systems. Qatar
will seek to purchase weapons from France and other European
countries as a result of their frustrations.

-- (C) Qatar will continue to develop a capacity to conduct
humanitarian assistance missions in the region. (This
explains Qatar's purchases of C17 and C31J aircraft.)

U.S.-QATAR MILITARY RELATIONS

-- (C) In the near term (next 12 months): The U.S. will want
continued freedom of use and access at Al-Udeid Air Base,
while Qatar will want to ensure that we are respecting
Qatar's sovereignty. The inherent frictions created by these
interests will cause us to experience continued tactical and
operational problems, particularly involving customs and
immigration. Some tactical irritants will impede missions in
the region.

-- (C) In the Mid-Term (next 24 months): Our stringent FMS
requirements, and Qatar's own acquisition slowdown, will
impede the goal of increasing Qatar's military capacity.

-- (C) The development of a closer U.S. - Qatari military
partnership will be frustrated by interoperability issues
created by Qatar's purchases of French weapons systems.

-- (C) Owing to the global economic crisis and their own
budgetary cutbacks, Qataris are no longer amenable to paying
the full cost of our relocation costs from Camp As-Saliyah to
Al Udeid Air Base, particularly costs related to temporary
facilities relocation (FFA costs). They will scrutinize line
items of every purchase more closely and will not make
purchases frivolously. This trend may continue over the
longer term, depending on the state's revenues from oil and
gas.

-- (C) In the Long Term (36 months): Expansion of our
military relationship with the Qataris will be affected by
the quality of our political relationship. Our political
relationship will also be significantly affected by our CT
relationship.

--------------
COUNTERRORISM AND COUNTERPROLIFERATION TRENDS
--------------


5. (C) A review and update of Qatar's counterterrorism and
counter proliferation trends reveals the following:

-- (C) Qatar is growing in importance as a transit hub in the
Middle East. In 36 months, Qatar will have a new
international airport and there will be further growth in the
number of people traveling to, and through, Qatar. This
increase will accordingly increase the counterterrorism and
counterproliferation challenges, further taxing the GOQs
already strained security infrastructure.

-- (S) Doha is likely to emerge as a transit point for
illicit technology. Those attempting to transit with illicit
technology are likely to be non-Qatari, so the possibility
exists that the authorities will take measures to stop it.
Although there are no notable instances of lack of
cooperation in counterproliferation, we have seen instances -
such as cases of North Korea using Qatar Airways to move
prohibited technologies - in which the GOQ was unable to
monitor these activities due to lack of expertise. Such
instances are likely to recur.

-- (S) The GOQ has the financial resources to purchase
security equipment for installation at airports, but lack the
expertise and personnel to implement it effectively. Given
the small population of Qataris, filling all positions in
security and immigration with Qatari citizens will become
even more difficult in the next 36 months.

-- (S) Counterterrorism cooperation from the Qatari
Government is currently poor, although there have been very
recent indications of improvement. The level of cooperation
from Qatar on counterterrorism and countproliferation
cooperation is intertwined to some degree with the bilateral
political relationship, and will continue to be so.

-- (S) Qatar will continue to be an inconsistent partner in
combating terrorist financing, unless continually prodded.
Qatar has been reluctant to fight terrorist financing for
reasons we do not fully understand. We do believe Qatar has
been reluctant to combat the financing of terrorist groups
and activities in part because it does not want to invite an
attack by antagonizing terrorist groups.

-- (S) Due to its small size and great wealth, Qatar will not
be a major source of jihadists. Qatar's citizens can,
however, support terrorism financially, and the capacity of
the Qataris to do so may outstrip the ability of the
government to stop it.

-- (S) The American military presence in Qatar will continue
to be a target for terrorism.

--------------
LAW ENFORCEMENT, LEGAL, AND JUDICIAL TRENDS
--------------


6. (C) A review and update of Qatar's crime and law
enforcement, legal, and judicial trends reveals the following:

-- (C) The population of Qatar has doubled in the past 5
years to more than 1.6 million people. This growth and the
societal changes that have accompanied it have outpaced the
ability of Qatar's government to address effectively the 21st
century law enforcement challenges it faces.

-- (C) Qatar's crime rate is still among the lowest in the
world, but there has been a 330% increase in violent and
non-violent crime since 2005. This trend will continue due
to the increase in the expatriate population, rapid economic
development, widespread use of the Internet, and the MOI's
slow pace to adapt to and implement necessary institutional
changes. The Qatari government will continue responding to
this threat by adopting biometric technologies and
information sharing with other law enforcement jurisdictions.

-- (C) The Qatari judiciary is largely independent. Qataris,
not just foreigners, are prosecuted for criminal conduct
according to the same standards as expatriates. This
approach represents a commitment to rule of law at the
highest levels of the GOQ and will continue.

-- (C) There are only 90 prosecutors and 120 judges in the
country, many of whom hear both civil and criminal cases; the
judicial system is overwhelmed. This trend will likely
continue.

-- (C) Qatar's Chief Justice is committed to reforming the
Qatari judicial system, which has no alternative dispute
resolution procedures or alternative sentencing measures such
as probation. Plea-bargaining is not practiced. Those
reform efforts will continue, though limited by Qatar's human
resource constraints.

-- (C) With increased flows of money into and out of Qatar,
the country is susceptible to economic crimes, but is still
ill-equipped to deal with them. In particular, rapid
economic development is increasing the opportunities for
money laundering and cybercrime in the country despite
expanded GOQ efforts to combat it.

-- (C) The Ministery of Interior (MOI) is the largest
employer in Qatar, with a workforce of approximately 10,000
people. However, Qatar has perhaps the lowest per capita
police to resident ratio in the world, one policeman for
every 800 residents. By comparison, the average ratio in
Western countries is one policeman to 300 residents.

-- (C) The MOI will continue to face a formidable challenge
in qualitatively staffing and retaining its officer corps and
enlisted ranks. The Qatar MOI's senior leadership is
reaching retirement age; there is a shortage of junior
officers, as the drive to fill more private sector jobs and
expanding economy is providing them with economic incentives
to leave the public safety/security services.

-- (C) The Internal Security Force (ISF),which is the elite
component of the MOI, trains constantly, but without
identified training goals or measures. There is considerable
scope for training and cooperation between the U.S. military,
particularly Special Operations Forces, and the MOI.

-- (C) The Minister of State for Interior Affairs, Sheikh
Abdallah bin Nasser Al Thani, will continue to command
respect and influence in the eyes of the Amir and Crown
Prince.


-------------- -
TRENDS IN THE ECONOMY, SCIENCE, AND TECHNOLOGY
-------------- -


7. (S) A review and update of trends in Qatar's economy
reveals the following:

-- Overall, the outlook for Qatar's economy remains positive
over the coming 36 months, though the upward trajectory is
moderated by the global economic crisis and drop in commodity
prices. It's only partly cloudy here economically, although
more clouds are appearing on the horizon.

-- (S) The "megatrend" driving all other economic and
environmental trends continues to be the exploitation of
hydrocarbon resources. In the next three years, Qatar will
double its output of liquefied natural gas (LNG) to 77
million tons per annum. A diversified contracted customer
base will provide some stability to Qatar's income from a
drop in demand in any one country/region.

-- However, the sharp drop in oil and natural gas prices (the
latter are often linked/indexed to the oil price) will reduce
Qatar's GDP growth and the major surpluses seen in recent
years may disappear. (For example, Q4 2008 GDP was 23 percent
lower than Q3, though still slightly larger than Q4 2007).
Ramping gas production is likely to still offset the drop in
commodity prices. But if oil drops below USD 45 per barrel,
Qatar will have to revisit its budget plans.

-- (S) Moreover, Qatar's additional natural gas supply will
result in further downward price pressure for natural gas in
the short-term. Demand for natural gas has softened
significantly with the global economic crisis.

-- Banking, real estate, stock prices and the labor market
have softened. Strong government spending should outweigh
these negative effects.

-- Most of the wealth will remain under the control of the
state, which distributes it via government spending. Even
among Qataris, however, a disparity in wealth will continue.

-- (S) Qatar's economy will continue to be dependent upon
both managerial/technical expertise and manual labor from
abroad. Although Qatar is undertaking educational reforms
which will fill some human resources gaps over the long-term,
the ambitions of the elite for Qatar's future are greater
than the capability of the local population to implement it.
Calls by the country's leadership for "Qatarization" - the
drive to move Qataris into managerial and technical positions
in place of foreign workers - will continue publicly, while
genuine implementation will fade or not be achieved.

-- (S) The financial sector will experience a qualitative and
quantitative increase. The Qatar Investment Authority (QIA)
will play an important role, though will be more cautious in
the face of the global financial downturn. The economic
crisis may have set back plans for a single, unified,
regulator though this could still be formed within 3 years.
Insurance products will become increasingly important as a
means of protecting investments.

-- (C) Debt among Qataris is high and will remain so. Banks
will refrain from pressuring Qataris to pay those debts. If
banks feel increasing pressure from deterioration in assets,
they will likely seek relief from the GOQ. The trend toward
tighter liquidity and the greater use of Islamic banking
options will continue.

-- (C) There will be piecemeal liberalization and
diversification, and Qatar is likely to become more cautious
in its plans for development of its financial sector. The
telecommunications industry is gradually being opened to the
private sector, and some economic decisions, such as patent
and trademark regulations and standards, will be made in
concert with GCC partners.

-- (C) Qatar's role as a regional and international
transportation hub will grow. Doha International Airport
will serve an estimated 10 million passengers in 2008. This
is a fivefold increase from a decade ago. Phase One of the
new airport is scheduled to open in 2010 with a passenger
capacity of 24 million. Qatar Airways will increase its
route network, including its U.S. destinations. There are
plans for a new seaport which will increase capacity by five
times in the first phase. Hotel capacity will quadruple from
the current 7000 rooms by 2012.

-- (C) Qatar will continue its commitment to becoming a
leader in science and technology. Relaxed investment laws
will attract more foreign participation in the science and
technology sectors. Internet usage has already increased to
more than 300,000 users, an increase of 866% since 2000, and
is expected to grow further.

-- (C) There will be growing concern over the environment and
food safety, but pollution will continue to be a major
problem. The newly established Ministry for the Environment
exemplifies this growing concern for the environment. Energy
companies in Qatar are increasingly involved in trying to
address environmental challenges.

-- (C) The rapidly increasing population will strain public
services such as water supplies, roads, and other
infrastructure components. Electricity demand is expected to
increase from 3419 megawatts in 2008 to over 10,000 megawatts
in 2012. Water usage will grow from 150 million gallons per
day in 2008 to 330 million gallons per day in 2012.

--------------
TRADE AND INVESTMENT TRENDS AND PATTERNS
--------------


8. (C) A review and update of Qatar's trade and investment
trends reveals the following:

-- (C) Qatar will continue to be plagued by a lack of human
capital.

-- (C) Qatar will continue to seek the latest technologies
and will look to U.S. leadership in this area. The Qatari
leadership knows that its fossil fuel supplies will run out
and is determined to use its current wealth to integrate
technology into its economy and society. But other than the
mere desire to acquire new technologies, there does not
appear to be a coherent strategy that identifies Qatar's
technology needs and how to fulfill them in a systematic way.

-- (C) Qatar spends USD 180 billion combined in the following
sectors: oil and gas, health and medical sanitation
projects, information communication technology, aerospace,
architecture construction engineering, safety and security,
franchising and education/training. These huge expenditures
will continue and the potential opportunities for U.S.
exporters will grow.

-- (C) Qatar will seek to become a "mega-brand" by marketing
itself as an international destination of "global" quality.
Qatar however lacks the services and supplies to sustain its
ambitions to become a global "brand name." The poor quality
of labor (born in part of a disenfranchised labor force) and
sparseness of services may cause major bottle-necks in its
infrastructure. There will continue to be opportunities to
leverage our expertise in a country with an ill-trained
native workforce.

-- (C) Qatar's pattern of "creative destruction" will
continue its growth trend, sweeping away the old and
replacing infrastructure with larger and more modern
versions. This will represent expanded opportunities for
U.S. businesses.

-- C) Qatar recognizes that the U.S. is the world's leader in
education and training, and education and training will
provide enormous opportunities for the U.S.

-- (C) The U.S. will remain the top exporter to Qatar
bolstered by Qatar's big ticket purchases of Boeing and
Lockheed aircraft. At the same time, an informal quota
system will persist whereby the Qataris purchase from a
variety of nations to curry favor with different governments.

-------------- -
TRENDS IN PUBLIC OPINION, MEDIA, AND EDUCATION
-------------- -


9. (C) A review and update of Qatar's public opinion, media,
and education trends reveals the following:

PUBLIC OPINION

-- (C) Despite the change in the U.S. administration, and
regional issues such as Iraq, Iran and Palestine, trends in
public opinion regarding the USG will continue to be volatile
for the next 36 months.

-- (C) Qataris will remain evenly split over whether it is a
good idea to have a close relationship with the U.S. In
recent CENTCOM polling, fifty-three percent oppose the U.S.
use of Al Udeid Air Base. But sixty percent of the polling
sample maintained that security is the main benefit of
bilateral relationship with the U.S., thus justifying the
presence of Al Udeid Air base.

EDUCATION

-- (C) Government financial support and a desire to provide
more Qataris with quality higher education will continue to
fuel the education sector in Qatar. Education City will
attract two new schools with international reputations -
probably from the United States - a law school and an
institution offering an MBA. The education system will
continue its standardization and major reform, mostly
borrowed from Western models including the United States.

-- (C) The Qatari Government's earlier intent that the
Ministry of Education be replaced by the Supreme Education
Council has been reversed. Government schools are expected
to exercise more autonomy along the lines of the independent
schools formerly administered by the Supreme Education
Council, as the Ministry of Education works to establish a
common core curriculum across schools in Qatar.

-- (C) Female students will continue to dominate higher
education, as percentages of university-educated women
continue to trend upwards and rates for men trend downwards.
Almost 46% of Qatari women between the ages of 25 and 29 have
acquired university level education. Amongst Qatari men
within the same age group, only 26% had university education.

-- (C) The lack of an educated workforce will persist due to
the opportunities Qataris have to make money without first
becoming educated. There is a lack of incentive for Qatari
males to finish secondary school.

-- (C) The rigorous admission requirements of U.S.
universities in Qatar Foundation (QF) create a disconnect.
Students at QF schools are seen as elites. There is a growing
friction between the elites and non-elites.

-- (C) While Qatar earlier sought to adopt an
Australian-style model of education involving a blend of
academic and technical coursework, it now appears that the
country will adopt the U.S. model of community college
education. Qatar currently lacks the community college and
vocational training system needed to respond to private
sector needs.

MEDIA

-- (C) Al Jazeera (AJ) maintains high viewership in Qatar
with more than 50% of the media market share. Over the next
36 months, there will be a steady expansion of AJ in Africa
and Asia, and through subsidiaries into other markets, such
as Turkey. AJ will slowly but steadily lose market share
within the region as computers improve their regional appeal.

-- (C) Qatar's commitment to a free press will remain limited
to news about other countries. Newspapers in Qatar, both
English and Arabic, will discuss certain political and
economic issues candidly but never criticize the ruling Al
Thani family or Qatar's foreign policy.

-- (C) According to several polls, about 40% of Qataris get
information from newspapers and this high rate of readership
is likely to continue. The presence of Northwestern
University's Medill School of Journalism may affect local
media coverage, but primarily beyond the 36-month window.

-- (C) The GOQ will continue to use the media to float trial
balloons on proposed changes in national laws. It will also
use the media to craft public opinion in its favor.

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DEMOGRAPHIC TRENDS
--------------


10. (C) A review and update of Qatar's demographic trends
reveals the following:

-- (C) The official population figure as reported to the
public is 1.63 million. This demonstrates continued rapid
growth.

-- (C) The actual population, according to a recent comment
by the Minister of State for the Interior, is two million.
As many as 1.8 million of this population is of foreign
origin. These numbers are expected to grow among every
nationality and region of origin, checked only by Qatar's
economic prospects and Qatari security concerns about certain
nationalities such as Pakistanis and Iranians.

-- (C) As the foreign population grows, Qataris will become a
smaller minority in their own country despite a relatively
high birth rate. Qatar will not increase the size of its
citizen population by gradually easing restrictions on
naturalization.

-- (C) South Asians from India, Sri Lanka, Nepal, Bangladesh,
and Pakistan account for an estimated 800,000 to 900,000 of
the expatriate population and work in a variety of sectors,
including construction, import/export, labor, business, and
information technology. The Indian expatriate community
remains the largest in Qatar. The Nepalese community grew
from 200,000 to 300,000 during 2008, and is now the second
largest.

-- (C) The Qatari population is likely to get younger.
Despite the expectation of a longer life expectancy, Qataris
continue to have large numbers of children. The estimated
median age of the Qatari population is between 31 and 32
years.

-- (C) Qataris under the age of 35 will be increasingly well
educated, urban, and wealthy. They will possess an
extraordinary range of opportunities distracting from the
business of building their country.

-- (C) Several Arab countries' nationals have a major
presence in Qatar, including Egypt, Palestine (typically
long-term residents),Yemen, Jordan, Lebanon, Sudan, and
Syria. Expatriate Arabs constitute an estimate 300,000 to
400,000 of the population. They tend to work in engineering,
accounting, import/export, education, energy, services,
hotels, and beauty.

-- (C) An estimated 200,000 East Asians live in Qatar. They
are mainly from the Philippines, Indonesia, Japan, South
Korea, and China. East Asians are prominent in the fields of
mechanical technology, energy, construction, engineering,
housekeeping, and labor.

-- (C) There are an estimated 10,000 to 20,000 Iranians
living in Qatar. Many Iranians in Qatar are long-term
residents. The Qatari Shia population is estimated at 10
percent of the Qatari national population. Qatari women
marry Iranian men, a rare instance of a female Qatari
marrying a foreign husband.

-- (C) There are as many as 40,000 Africans living in Qatar.
They come from Kenya, Nigeria, Somalia, Ethiopia, Eritrea,
and South Africa. African expatriates work mainly in
construction, labor, trade, import/export, energy, and oil
services.

-- (C) Europeans account for an estimated 20,000 to 25,000 of
the expatriate population. They are generally citizens of
the United Kingdom, France, Germany, Spain, and Turkey.
Europeans work in energy, shipping, engineering,
construction, management, education, finance, and investment.

-- (C) There are at least 10,000 to 12,000 expatriates from
North and South America (excluding the U.S.) residing in
Qatar. They are mainly from Canada, Brazil, Venezuela,
Mexico, and Colombia. These individuals work in energy,
oilfield services, education, and for Qatar Airways.

-- (C) The American citizen population will continue to grow,
with the growth in the energy and educational sectors and
with the increased U.S. military presence. There are
approximately 8,000 American citizens registered with the
U.S. Embassy in Doha, compared with only 1,500 in 2000. Over
170,000 U.S. citizens transited through Doha in 2007, and
this figure will grow as Qatar's airport expands and its
national airline grows.

-- (C) At any given time, the Embassy estimates that there
are approximately 15,000 private American citizens present in
Qatar. American citizens are prominent in the energy
industry, working for ExxonMobil, Conoco Phillips,
Occidental, Chevron, and various energy services companies.
American citizens also work for military contractors, the
U.S. universities at Education City, the American School of
Doha, and a wide range of educational institutions in Qata.
Continued growth in the education and energy sctors will
bring in more American citizens over te next three years.


LeBaron