Why Residency Policy Matters for the Gulf Economy

Do Gulf states need to do more to retain and attract high-value expats, such as professionals and entrepreneurs? The benefits seem to be clear, but getting the right policies may be challenging.

By Fahad Badar

I recently had a conversation with a major investor in the Qatari economy, an expatriate businessman.

 He had just had his visa renewed, but for only one year, on the basis that he is over 60 years old. Given that he could live for another couple of decades or more, that the scale of his investment is huge, and that investment and attracting expatriate talent is a priority for the country, this visa extension does seem unnecessarily short.

This kind of incident highlights the issue of how to encourage long-term residences in the country as part of a strategic commitment to increase the population. It is an issue that all Gulf states are confronting.

One of the most reliable causes of economic growth is population growth – but some types of enhanced population are more economically beneficial than others. 

Young professionals and entrepreneurs are those most in demand from nations looking to attract expatriates.

Typically, Gulf states do not offer full citizenship to expatriates. The principal route to long-term residences is through some kind of long-term visa.

Retention of high-value expatriate professionals and investors is at least as important as attraction – perhaps more so.

 The longer that they stay in the country, the greater the advantages. Long-term residents are more likely to invest in the local economy, and remit less of their savings abroad.

Qatar’s policy could be made both more attractive and clearer – easy-to-follow eligibility rights and rules, the ability to work in different sectors, and to set up businesses, all set out clearly in online portals. At the moment, information is available from different sources, and is not always consistent.

The requirements of ‘Golden Visas’, used by many countries, are becoming more sophisticated.

 There is a move away from a link to net wealth alone, as this can attract individuals with a criminal past who are engaged in money laundering.

 It is better to vet people, and consider a range of considerations confirming suitability.

The Qatar Investor Visa requires a clean criminal record, a good conduct certificate and a $200,000 investment.

 In Oman, a new ten-year Golden Residency Visa scheme represents an expansion on existing schemes. The new programme broadens eligibility, digitalises applications, and is inclusive for first-level family members. 

There are seven qualifying routes, each with a minimum investment of 200,000 Omani rial (OMR), the equivalent of US $520,000. 

It is easy to find the relevant information, on the requirements and the application process. The United Arab Emirates also has a clear set of requirements for its Golden Visa programme. Residency is for between five and 10 years, and is offered to investors, entrepreneurs and various categories of professionals, and includes family inclusion.

For Qatar, the population grew sharply in the first two decades of this century, and more slowly since. 

The population grew from 1.7mn recorded in the 2010 census, to 2.4mn in 2015, a rise of 41.5%. It reached 2.8mn at the 2020 census and is estimated to be around 3.1mn now. Only around 10% of residents are Qatari citizens, reflecting the high number of professional expatriates and guest workers.

A positive finding from the census is that, despite a population that has many more men than women there is a high proportion of people who are married. 

There is also a healthy rate of births. The World Population Review website records 82 births per day and 99 immigrants, compared with nine deaths.

One issue is that the growth in population has not kept pace with the expansion of real estate. 

The period of low interest rates and preparation for the 2022 FIFA World Cup led to a construction boom.

 The excess supply is not huge, however, and it could be turned to an advantage. A potential selling point to high net-worth expats is plentiful modern housing at reasonable prices and excellent transport infrastructure, while for business investors, there is modern office space.

Globally, concerns about a projected fall in the human population are growing. 

Most nations have birth rates that are below the so-called replacement rate. 

The replacement rate is 2.1 babies per woman, but in much of the world it is around 1.0 or lower. The United Nations has projected that the world population will peak in the 2080s – however if fertility rates continue to be low or to fall, this could come sooner.

As we near the age of declining world population, nations are becoming more aware that their ultimate asset is not infrastructure, paper money or precious metals, but people. Competition for the most valuable economic asset looks set to intensify.

The author is a Qatari banker, with many years of experience in the banking sector in senior positions.