BUSINESSPAGE | 14 PAGE | 14

13TUESDAY 21 JULY 2020

QDB participates in first virtual edition of Asia Blockchain Summit

PEZA to discuss Islamic

finance in Philippines

Qatar's business leaders, top bankers optimistic about reigniting economy

LANI ROSE R DIZONTHE PENINSULA

As the third phase of corona-virus restrictions are set to be lifted next month, Qatar’s top bankers and business leaders are optimistic about reviving the local economy.

Participants of the live co-hosted Euromoney and Com-mercial Bank webcast ‘Qatar: Navigating the New Normal’, which included United Devel-opment Company (UDC) Pres-ident, CEO and Board Member Ibrahim Jassim Al Othman; Commercial Bank Group Chief Executive Officer Joseph Abraham; and Commercial Bank Executive General Manager for Wholesale Banking Raju Bud-dhiraju; stressed that Qatar is on the road to recovery, and though demand patterns will change, the strategic direction of the nation was unchanged.

“We were equipped with liquidity from financial institu-tions to get us through the first three months of the pandemic. We did not stop our con-struction business throughout the lockdown. In fact, we have just recently awarded major contracts for the Gewan Island

development. In Qatar, you see the life is coming back at a very rapid pace at the moment. And it’s about time that we get over this fear and start to live our lives normally. "

"Maybe it won’t be exactly the same, and maybe this won’t be over completely very soon. But we need to get back on track and continue with our lives. You cannot just lock yourself down forever. Things have to move, and have already started to move. I’m sure by late this year or early next year, we will see quite a change. I’m sure everybody learned a lot from this, and I only look forward to positive things resulting from

this pandemic,” said Al Othman. The participants also high-

lighted how Qatar’s experience of the 2008 financial crisis and the 2017 blockade had prepared the country for the sudden shock of the pandemic and lockdown. The panel interview also highlighted the rapid and effective action by the Qatari government, in particular the Qatar Central Bank and the Ministry Of Finance, as well as the cooperation between the corporate and the financial sectors in managing the chal-lenges during pandemic.

“As a leading Qatari bank we believe the future is digital and we have experienced a

fundamental change in cus-tomer behaviour, with many more clients using digital banking channels for the first time. COVID-19 has therefore presented a window of oppor-tunity for us to accelerate our client experience of digital banking and our digital agenda, both in terms of how we interact with our customers at the front-end but also embedding digital throughout our organization. The impor-tance and role of technology is going to be much more prev-alent in people’s thinking. And Qatar has a very high level of technology awareness,” added Abraham. �P14

FROM LEFT: UDC President, CEO and Board Member, Ibrahim Jassim Al Othman; Commercial Bank Group Chief Executive Officer, Joseph Abraham; and Commercial Bank Executive General Manager for Wholesale Banking, Raju Buddhiraju

GCC government debt projected to increase by $100bn in 2020SATISH KANADY THE PENINSULA

With the funding needs in the Gulf Cooperation Council (GCC) increasing significantly in 2020, the total GCC government debt is expected to increase by a record-high of about $100bn in this year alone, with an additional $80bn run-down in government assets to finance an aggregate GCC central government deficit of about$180bn.

The S&P Global Ratings said yesterday low oil prices and the economic repercussions of the COVID-19 pandemic have sig-nificantly widened govern-ments’ fiscal deficits.

“Based on our macroeco-nomic assumptions, we expect to see GCC government balance sheets continue to deteriorate up until 2023,” said S&P Global Ratings credit analyst Trevor Cullinan.

“Most GCC sovereigns have demonstrated ready access to the international capital markets this year, and are in the enviable position of

having substantial pools of external liquid assets to fund their fiscal deficits should market access become con-strained”, he said.

S&P Global estimates that GCC sovereigns’ central gov-ernment deficits will reach about $490bn cumulatively between 2020 and 2023.

A large part of the surge in GCC government funding needs relates to central gov-ernment deficits in 2020, with the simple average reaching 18 percent of GDP compared with 5 percent in 2019. In the wake of the sharp decline in oil prices from second-half 2014, the 2016 combined deficit was at similar levels--$190bn, or 16 percent of combined GDP.

In its forecast, S&P Global assumes an average Brent oil price of $30 per barrel (/bbl) for the rest of 2020,$50/bbl in 2021, and $55/bbl from 2022, relative to $64/bbl in 2019. However, as deficits still remain quite sizeable in some cases, GCC government balance sheets will continue to deteriorate up until 2023. �P14

14 TUESDAY 21 JULY 2020BUSINESS

FROM PAGE 13Buddhiraju went on to reit-

erate the importance of Qatari medium and long-term pros-pects in various sectors. “While there are challenges in the short term arising out of the COVID-19 pandemic, we must realize that five years from now, Qatar is very well placed with many investments, including but not limited to North Field Expansion projects increasing the gas

production capacity by 65 percent, and the Hamad Inter-national Airport capacity of 60 million passengers. This presents a tremendous oppor-tunity in Qatar, and companies that invest in technology will develop a distinct competitive advantage,” he added.

The event, which was streamed live to a global audience of over 500 attendees, drew a record audience of

international business, analysts, and financial professionals. It also featured exclusive real-time footage of both The Pearl and Gewan developments, another first for a Euromoney webcast.

“We were overwhelmed with the level of interest and interaction, more than anything we’ve seen since launching our digital stream in March,” said Richard Banks, Editor of Euromoney LiveStreams.

Qatar's business leaders, top bankers optimistic about reigniting economy

GCC government debt projected to increase by $100bn in 2020

FROM PAGE 13As a percentage of GDP,

Qatar has the lowest 2020 gov-ernment deficit-to-GDP ratio of 10 percent.

Since the sharp fall in oil prices, many GCC sovereigns have posted sizable central government deficits. These increased funding needs prompted total GCC gov-ernment debt issuance in local and foreign currency of over $90bn in 2016 and 2017, and S&P expects a new record high

of about $100bn in 2020. And then expect total annual debt issuance to trend down toward $70bn by 2023.

GCC governments have, for the most part, borrowed rather than liquidated their assets to fund their deficits. S&P includes in its projections a funding mix of asset drawdowns and debt issuance. It expects that debt issuance will meet about 60 percent of the $490bn financing requirement in 2020-2023.

“We base this assumption

on the financing trends of the past few years, governments’ explicitly stated policy deci-sions, and our view of the avail-ability of assets”, the rating agency said.

Thanks to their hydro-carbon wealth, some GCC gov-ernments have accumulated large pools of financial assets, which they can use to fund their fiscal deficit. For instance, Gov-ernment assets in some GCC countries like Qatar exceed government debt.

QDB participates in first virtual edition of Asia Blockchain SummitTHE PENINSULA — DOHA

In its endeavoUr to accelerate the digital transformation of the financial services sector in the country, Qatar Development Bank (QDB) recently participated in the Asia Blockchain Summit 2020 (ABS2020), where the bank’s CEO Abdulaziz bin Nasser Al Khalifa delivered a keynote presentation on FinTech Inno-vation in Qatar.

The third annual summit, held vir-tually for the first time this year, wit-nessed the participation of more than 200 speakers, 800 investors, and pro-fessionals from leading industry startups, financial service providers, academic institutions, and policy groups, who gathered over five days to discuss the future of blockchain technology and its real-world applications.

Commenting on QDB’s participation in the event, Abdulaziz Bin Nasser Al Khalifa said: “From FinTech’s early emer-gence as a challenger to a conventional financial services sector to its role today as a change catalyst and enabler, it is safe to say that our industry has come a long way. Blockchain is following suit, with 10 percent of global GDP expected to be stored on Blockchain by 2027. In Qatar, Blockchain and other emerging technol-ogies can play a major role in Qatar’s overall economic transformation, espe-cially in the digitization of various sectors,

where they can be applied in four key areas; Government to Citizen, Business to consumer, Government to Business, and Business to Business.”

He added: “At QDB, we are making remarkable headway in creating a world-class FinTech Hub in Qatar in col-laboration with the Qatar Central Bank and the Qatar Financial Centre, as well as laying the foundation for transforming ourselves into a Digital Development Bank of the future and serve as a model to be followed in the region. In this regard, ABS2020 is a great platform to engage with key stakeholders and witness the emergence of future-proof business models and technologies that

can transform the financial services sector.” In his keynote, the QDB CEO talked about the steady rise of an eco-system model in the financial sector and the potential partnerships between banks and cross-sector players to dis-cover new relationships and build inno-vative platforms that enable participants from within and outside the region to access trade finance, asset exchange, payments, and value-added services.

AlKhalifa also shared updates on the Qatar FinTech Hub (QFTH), which has started receiving applications for the first wave of its Incubator and Accelerator programs. QFTH is set to help institu-tions accelerate their digital

transformation by integrating Fintech and digital technologies in their product and service offerings.

Qatar’s nationwide smart transfor-mation initiatives, its National Vision for the year 2030, and the 2022 FIFA World Cup, will harness and leverage technology in unprecedented ways as the country builds and scales a knowledge-based economy, the QDB CEO pointed out.

According to Al Khalifa, Blockchain will be at the heart of this transformation, from a smart government infrastructure to Islamic FinTech and a cashless World Cup experience, which he said presents limitless opportunities for the world’s innovators, be it large conglomerates or disruptive startups, to play an active role in Qatar’s business ecosystem.

The QDB CEO’s presentation took place on the 3rd day of the summit, which focused on Blockchain’s role in entrepreneurship. Other speakers in this year’s edition include the First Canadian Commander of the International Space Station Chris Hadfield, U.S. Securities and Exchange Commissioner Hester M. Peirce, Co-Chair of the European Com-mission FinTech Task Force Pēteris Zil-galvis, Head of Blockchain and Data Policy at the World Economic Forum Sheila Warren, and the Creator of ‘Ethereum’ cryptocurrency Vitalik Buterin, among other industry experts and stakeholders.

Natural gas boasts the potential to drive greening of Asean regionTHE PENINSULA — DOHA

The Gas Exporting Countries Forum (GECF), the global platform of the leading gas producing nations, organised a joint online workshop with the Economic Research Institute for Asean and East Asia (ERIA) on ‘The Role of Natural Gas Towards Greening Society in ASEAN and East Asia’ on 16th July 2020.

The discussion on one of the world’s most populous regions was held amidst changing energy demand patterns, par-ticularly in the light of COVID-19, and explored the Asean's ambition to propel its energy transition into clean energy systems using natural gas, while simultaneously addressing economic recovery, job creation, and climate mitigation.

The workshop featured high calibre speakers, including H E Arifin Tasrif, Minister of Energy and Mineral Resources, Indonesia, Prof Jun Arima, Pro-fessor of Graduate School of Public Policy, University of Tokyo, Japan, Takeshi Soda, Director, Oil and Natural Gas Division, Agency for Natural Resources and Energy at the Ministry of Economy, Trade and Industry, Japan, Dr Twarath Sutabutr, Inspector General at the Ministry of Energy, Thailand, and Shigeru Kimura, Special Advisor on Energy Affairs to the President of ERIA.

The GECF Secretary General Yury Sentyurin welcomed the audience and shared his delight with the participants on Malaysia becoming the first member from the ASEAN region to join the Forum, which now spans 20 members and four continents.

Highlighting the importance of cooperation among natural gas consumers and producers as a bedrock of gas market sta-bility, HE Sentyurin also spec-ified that the GECF strives for natural gas supply and demand security for the Asean and East

Asia, which is in line with the unanimously supported 2019 Malabo Declaration at the outcome of the 5th GECF Summit. Headlined ‘Natural Gas: Energy for Sustainable Development’, the Declaration demonstrates the GECF Member Countries’ resolve to strengthen global energy security as reliable suppliers of natural gas to the world’s growing energy demand, he said.

Secretary General Sentyurin stated: “Our projections show that over the next three decades natural gas consumption in the Asean and East Asia region will more than double, rising from 736 billion cubic metres (bcm) in 2019 to around 1,500 bcm by 2050. Its share in the energy mix of this currently coal-led region is projected to grow from a modest 10 percent at present to over 15 percent by 2050.”

“However, we see even more potential for fuel substi-tution, especially in the power generation and transport sectors, provided that gas-based infrastructure afforda-bility grows, and more favourable policy measures are implemented.”

Speaking about Indonesia, H E Tasrif referred to Indo-nesian President Joko Widodo’s pledge at the 21st COP Meeting and the Paris Agreement (both in 2015) to commit to reduce greenhouse gases in Indonesia by at least 29 percent by 2030, and using the clean attributes of natural gas to achieve that goal.

“Today, we are shifting from an oil dominion to gas

dominion. We are trying our best to find more gas resources and find effective ways to transfer the resources to become proven reserves. In 2019, Indonesia’s total gas pro-duction was 6,138 mmscf (million standard cubic feet per day) which came from various sources, in Sumatra, Java, Papua. Moreover, the gov-ernment is also developing gas supply to meet the ever-growing demand. We are also ensuring that upstream of gas activity is still effective for investors.” According to the Minister, Indonesia is attaching priority to the use of natural gas by investing in programmes such as Gas Price for Industry, Conversion of Diesels to Natural Gas for Power Plant Use, Devel-opment of Gas Pipeline Infra-structure, and City Gas, to name a few.

“By optimising natural gas utilisation, Indonesia would have a future target that will enable natural gas to take 22 percent of its share in the energy mix by 2025 and 24 percent by 2050. Natural gas will become the future of clean energy together with renewable energy,” he said.

It is to be noted that the world’s largest island country, Indonesia, was one of the founding members of the GECF and has meaningfully con-tributed to the establishment and the positioning of the Forum as its long-standing ally. The Indonesia Minister used the platform of the GECF to invite all interested parties to take part in developing the Indo-nesian gas industry.

“With the increasing demand for energy and the urgent need to develop more green society we believe that the role of gas will be very crucial. We hope that the rise of natural gas’s role in fulfilling the increasing demand for energy will continue to create a sus-tainable energy market, espe-cially in the Asean and East Asia region,” said the Minister.

PEZA to discuss Islamic finance in PhilippinesTHE PENINSULA — DOHA

The Philippine Economic Zone Authority (PEZA) will hold its third online Business Continuity Forum on ‘Islamic Finance as Vehicle to Economic Recovery’ on Thursday.

The webinar which will discuss the Shariah gov-ernance framework and guidelines on the estab-lishment of Islamic banks and Islamic banking units in the Philippines. The forum will highlight the discussion on Islamic finance as a vehicle to economic recovery.

Doha-based PEZA Investment Promotions Partner (KaPIPPS) Joseph Timothy Rivera (pictured) said the virtual conference will attract a bigger audience as the coverage will now span across all GCC countries to include most Middle Eastern and Asian countries.

Blockchain and other emerging technologies can play a major role in Qatar’s overall economic transformation, especially in the digitisation of various sectors, where they can be applied in four key areas.

Abdulaziz bin Nasser Al KhalifaQDB CEO