(MENAFN - The Peninsula) Qatar's 2014/15 budget proposals for the record public spending are expected to benefit the local contracting companies in a big way. As per existing government decision, the Qatari contracting companies will get 30 percent share in the QR87.5bn earmarked for development projects this fiscal
The government has recently made it mandatory for all global companies bagging mega infrastructure development work to share at least 30 percent of the contract with local entities
According to the budget proposals, projects valued at an estimated QR664bn are anticipated to be implemented during the next five years.
This excludes oil and gas projects, meaning the local companies, which were just spectators of booming Qatar until recently, will emerge as key players in the over-all development from now.
This also means at least 30 percent of the money spent on a project would be ploughed back into the national economy
In the budget proposals, the government has unequivocally stated that it would adopt a set of policies to support the private sector, such as avoiding competition between public and private sectors in the local market. It has also made it clear that it would award more projects to private sector and encourage the ministries and state institutions to outsource its supporting businesses to private companies
The Chamber, representative body of the private sector, has been lobbying the government for the past four years to ensure the local contracting companies are being part of the country's growth story
Reacting to the budget proposals, Qatar Chamber Board member Sheikh Hamad bin Ahmed Al Thani hoped that the tenders for key proposed projects would be floated without delays.
"Private sector share in the new budget is huge. The issue of local contracting companies missing opportunities in Qatar's development trajectory was a major worry for the private sector. The budget proposal reflects the Emir's decision that the local companies play a bigger role in the country's overall development," Sheikh Hamad said in an interview to Al Arab
Rashid Hamad Al Adbah, a leading businessman, said that the active involvement of local companies in Qatar's key projects will help complete the propose projects on time. The new budget is also aimed at encouraging Qatar's emerging SMEs sectors.
The local contracting companies' opportunities are not limited to the FIFA-related projects. The budget has unveiled a host of projects in the education and health sectors as well. Projects worth a total of QR26.3bn have been announced in the education sector. The budget allocation for the health sector stands at QR15.7bn
Abdullah Al Khater, a local financial analyst, noted the new budget offers enough scope for the much-discussed public-private partnership. He wanted the local contracting companies to get ready, both in terms of infrastructure and manpower; to take up the new challenge and prove they are competent to deliver mega projects. They must also grab the opportunity to get themselves familiar with the expertise of international companies