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Gulf Times Thursday, December 19, 2013

COMMENT
Chairman: Abdullah bin Khalifa al-Attiyah Editor-in-Chief : Darwish S Ahmed Production Editor: C P Ravindran

P.O.Box 2888 Doha, Qatar editor@gulf-times.com Telephone 44350478 (news), 44466404 (sport), 44466636 (home delivery) Fax 44350474

GULF TIMES
Qatar shaping destiny for posterity with sustainable growth
Qatars growth story has been one of breathtaking economic expansion in recent years. Between 2003 and 2006, nominal GDP growth averaged 24.6% to $52.7bn, meaning that in the four years the economy tripled in size. By 2012, the GDP almost trebled to $192bn, with the oil and gas sector accounting for 58%, according to a recent QNB Group report. Qatars economy, with the highest per capita income in the world, is estimated to grow 6% this year, higher than the earlier 5.3%, on unforeseen gains in gas production, but growth will moderate to 4.6% in 2014, according to revised official estimates published on Monday. Inationary pressures in Qatar are unlikely to subside in 2014 with a moderate 3.5%, but measures to curb market abuses are expected to help keep price rises in check, the Ministry of Development Planning and Statistics said. An outstanding feature of Qatars phenomenal growth has been the growing share of the non-hydrocarbon sector, which could be worth more than half of the countrys GDP by 2015. Driven by mega infrastructure projects for the FIFA World Cup 2022 in an estimated $200bn-plus spending drive, the non-oil segment is slated to grow from 42% in 2012 to top 50% by 2015, QNB Group said. Qatar is snapping up assets across the globe as it seeks to reduce its energy dependency. The $100bn-plus Qatar Holding, the foreign investment arm of the Qatar Investment Authority, has been the most active of the regions sovereign wealth funds in recent years. With stakes in companies including Barclays, Volkswagen, Porsche, Xstrata and Credit Suisse, the fund earned a 17% return on its investments last year. Qatars nancial dynamism is drawing international and regional attention. The most competitive economy in Middle East and North Africa, the country is also the 11th-most competitive in the world, according to the World Economic Forums Global Competitiveness Index 2012-2013. Qatar was recently upgraded to Emerging Market status by S&P Dow Jones Indices and Morgan Stanley Capital International, set to take effect in 2014, increasing its importance for an international investment portfolio. Qatars leaders are devising policies to ensure that the fruits of the countrys growth are shared among its citizens. The country would create a new $12bn investment rm, backed by blue-chip assets from its sovereign wealth fund, and list it on the Qatar exchange. Qatar Holding said in February the new rm would invest in assets around the world. Listing a company of this magnitude will give Qataris a chance to be part of the countrys growth and will bring in sophisticated foreign investors, said Doha Bank Group CEO R Seetharaman. The country is also offering shares worth QR50bn of several state-owned companies to Qataris over a period of 10 years. The destiny of a country is largely dened by the way it makes use of its resources so that the future generations should live with dignity and prosperity. Guided by the forward-looking policies of HH the Emir Sheikh Tamim bin Hamad al-Thani and in compliance the Qatar National Vision 2030, Qatar aims to be an advanced society capable of sustaining its development and providing a high standard of living for all of its people for generations to come.
Gulf carriers will cover coast to coast from New York to Seattle (below).

USA, here we come!

Emirates, Qatar Airways and Etihad have announced the launch of new 2014 routes to destinations worldwide
By Updesh Kapur Doha

Qatars leaders are making sure the fruits of growth are shared among its citizens

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he land of opportunity is avour of the month, or more appropriately avour of 2014, as preparations are well underway for a very busy calendar year ahead. The next 12 months will witness unprecedented activity in the air corridor that links the Gulf and the US. It will be the busiest period for air traffic between the two regions with more routes, more ights and more seat capacity than ever before connecting both markets. In recent weeks the Big 3 Gulf airlines Emirates, Qatar Airways and Etihad have announced the launch of new 2014 routes to destinations worldwide in line with their year-onyear aggressive growth strategy. In a year when all three airlines will open up almost 20 new routes between them across different continents, onethird of these will be to the US alone. Beginning in March, the regions three mega carriers will open up six new routes between them in the space of nine months. Two of the destinations will be new on the Gulf roadmap Boston and Miami. The American expansion will see the number of routes operated by the Big 3 increase from 14 now to 20 by the end of next year. Currently there are 119 weekly scheduled passenger ights between the three Gulf neighbours and the US. By this time next year, frequency will rise 30% to 154 weekly services, but this gure is likely to change as the carriers are almost certain to announce further US expansion. The love affair with the US started in 2004 by Dubais Emirates has excelled well beyond the honeymoon period and set to continue with passion as the three rivals look to cement their presence in the skies between both parts of the world. After Emirates foray into the US with New York, Los Angeles and San Francisco, it quickly ramped up its presence to seven destinations across the country now also covering Dallas, Houston, Washington and Seattle. By far the biggest Gulf operator to the US, Emirates will add Boston to its portfolio in March 2014. The carrier has focused much of its recent American expansion on increasing frequency and seating capacity on established routes such as New York and LA, whether its deploying additional daily ights or inducting the near 500-seater Airbus A380 super jumbo. Qatar Airways entered the American market in 2007 with route launches from Doha to New York and Washington due mainly to the arrival of new long haul aircraft into its eet. Houston was added in 2008, but it took ve years before the national carrier ventured further into the US market with the introduction of scheduled passenger ights to Chicago last summer.

2014 will see the airlines ambitious US expansion plans take shape with not one, nor two, but three American destinations added in a four-month period starting in April Philadelphia followed in June by Miami and soon after Dallas. By contrast, Etihad, the national carrier of the UAE, will add two new routes Los Angeles and Dallas, six months apart starting in June. It already ies to New York, Washington and Chicago. So why the sudden fascination with the US? For starters, the Gulf carriers have, in recent years, concentrated much of their dramatic expansion in Asia, the Middle East and Europe. Without a strong network in these markets, it wasnt feasible for the Gulf carriers to develop a stronghold in the US. With coverage saturated in their core markets, and considering emerging passenger traffic ows, it was only natural to expand into unexplored territory. Quite ironic when the US is the worlds biggest aviation market! The arrival of long haul planes has helped the carriers open up new nonstop services linking their Gulf hubs with cities across the US that have ying times of between 12 and 16 hours. Growing bilateral relations and rising economic activity are always an impetus to stimulate movement of people between nations. Air capacity, both passenger and cargo, is therefore a crucial component of any economic activity. Bilateral trade between the GCC and the US increased from $71.1bn in 2010 to $123.7bn last year a rise of almost 74% according to gures released at a recent meeting of the US-Qatar Business Council in Washington. The oil and gas energy connections of the Gulf and southern US are only too natural to take advantage of, but there are plenty of other sectors that can pave the way for more business. IT, logistics, construction, education, food, beverage and hospitality are just a few. Culture, sports, media, fashion, science, medicine and research are among the others. The aviation sector on its own accounted for its fair share of the gures with US aircraft manufacturer Boeing a key supplier of planes to the three leading Gulf carriers. With the

three placing combined orders for 250 aircraft worth almost $100bn during last months Dubai Air Show, the US is clearly a key trading partner for the region. Qatars trade with the US has crossed $5.5bn so far this year, up from $3.6bn in 2010, and set to continue its growth path. US Ambassador to the State of Qatar, Susan L Ziadeh said: The aviation sector plays a key role in the ever expanding US-Qatar trade relationship. The new routes to the US operated by Qatar Airways are just one example as Qatar Airways now ies to four US cities with three more to be added in 2014. As Qatar grows as both a travel hub and a destination for international travellers, its expanding aviation links to the US will increase the ow of investors, tourists and students between both countries and ultimately strengthen our people-to-people exchanges. The fact that six American universities have overseas campuses within Qatars Education City is a reection of the strong relationship the two countries share which Ambassador Ziadeh clearly alludes to. Her comments can also be echoed by developments in the UAE. With trade between the Gulf and the US enjoying sharp annual increases, it isnt this alone that has tempted more ights between the two intercontinental markets. The regions aviation sector is facilitating traffic ows of travellers from different parts of the world. The Gulfs small population base is insufficient to ll the 400-plus aircraft based in Dubai, Doha and Abu Dhabi hence, the strategy to connect different parts of the world with air services via the Big 3 Gulf cities. One of the worlds largest traffic ows is between South Asia namely India, Pakistan and Sri Lanka and the US. It is this air corridor that the

In the air
Qatar Airways: Flies from Doha to New York, Washington, Houston and Chicago. NEW for 2014: Philadelphia (daily, April 2), Miami (four-times-a-week, June 10) and Dallas (daily, July 1). Emirates: Flies from Dubai to New York, Washington, Houston, Dallas, Los Angeles, San Francisco and Seattle. NEW for 2014: Boston (daily, March 10) Etihad: Flies from Abu Dhabi to New York, Washington and Chicago. NEW for 2014: Los Angeles (daily, June 1) and Dallas (three-times-a-week, December 3)

Gulf has successfully tapped into with the advent of US ights but only after having built up a strong presence in South Asia. This will continue and only strengthen as the Gulf carriers bolster their position with more ights to and from these key Asian markets. With domestic US airline partners, the Big 3 can transport passengers further aeld beyond their American gateway cities to destinations that are not viable as stand-alone non-stop ights from the Gulf. These include cities across the US as much as cross border destinations in Central America, South America and the Caribbean via Houston and Miami. Flights to Floridas commercial capital of Miami are long-awaited, hailed as a potential money spinner being a key gateway to neighbouring countries where there are limited or no services from Asia and the Middle East. In reverse, giving travellers easier and quicker access to the Gulf and beyond to rest of the Middle East, Africa and Asia, has opened up an air corridor bypassing congested hub airports in Europe. One would question why only two US carriers currently operate ights to the Gulf: daily Delta services from Atlanta to Dubai and United serving the UAE city daily from Washington with an onward hop to Doha. Its more to do with business strategy and pursuing traffic ows than anything else. As mentioned earlier, one of the worlds largest traffic ows is between the US and South Asia. It is neither economically practical nor protable for a US carrier to y its own metal (aircraft) to the Gulf in large numbers when much of the passenger traffic is connecting onwards. To rely on partner airlines to carry passengers onwards to these larger markets is not deemed feasible. Gulf airline executives clearly point out the US is the last missing piece in a global jigsaw. It is a natural progression of organic growth. All sing from the same hymn sheet one cannot be a true global player without being part of the worlds largest aviation market. It is inevitable that the Big 3 will continue their US growth, more likely through increased frequency and bigger aircraft deployment than new route openings. Of the major US cities yet unexplored, only time will tell whether two of Americas biggest cities Atlanta and Detroit will feature on the Gulfs radar. Watch this space! Updesh Kapur is a PR & communications professional, writer, aviation and travel analyst. He can be contacted at updeshkapur@gmail.com