AsianInvestor Qatar report: World Cup

AsianInvestor Qatar report, July 2013

On December 2 2010, Qatar was announced as the successful bidder for the 2022 FIFA World Cup. The immediate response worldwide tended to divide in to two camps, one asking about the hardship of playing football in the middle of an Arab summer, and other asking: where’s Qatar? And this speaks to one of the main achievements of the successful bid: if there was anyone who didn’t know about Qatar beforehand, they do now.

The World Cup will be transformative for Qatar in many respects, and global recognition – the idea of putting the place on the map – will be only one of them. The infrastructure required to host the tournament will have a significant impact on the appearance and development of the state, and that infrastructure development will be a vital driver of the economy, diversifying business away from oil and gas. And it will be an opportunity to showcase Qatari society and the state’s ability to organise an event on an unprecedented scale: the only other sporting event of any consequence that Qatar has hosted is the 2011 Asian Cup, where the average attendance was just 12,000 people.

The event’s backers like to depict Qatar’s success as a regional rather than a local one. “We viewed our bid as not just a Qatari bid, but as a Middle Eastern one, encompassing all the countries of the region with benefits that would be felt throughout,” Nasser Al Khater, executive director of communications and marketing for the Qatar 2022 Supreme Committee, tells AsianInvestor.

“Our region is often misrepresented and misunderstood,” he says. “Holding an event of such magnitude would bring different peoples of different cultures and religions together in the Middle East, united in their share passion for football. We urged FIFA and the international football community to envision the positive impact of bridging cultural gaps and increasing understanding between cultures through football.” Additionally, he says he hopes the tournament will leave a lasting legacy, in many forms: technological (cooling, modular stadiums), social (progress and development in the Middle East) and bridging cultures through football, “with people leaving our region with a refreshed outlook on the Middle East and what it means to them.”

A separate article looks at infrastructure development broadly in Qatar, and it can be tricky to separate out what is World Cup related and what is a function of Qatar’s expanding population, since things like the new rail system serve both purposes.

Even if one only considers the stadiums, the requirement is extraordinary and will cost $4-5 billion for their construction alone. As FIFA’s evaluation document on the Qatar bid explains, the World Cup format requires 12 stadiums of sufficient scale and quality to host World Cup matches. So, even though all Qatar’s venues will be within a radius of 60 kilometres – “a novel approach to event operations and legacy,” as FIFA says – Qatar must still develop 12 world-class facilities in that small space. Three will be extensively renovated from existing facilities; nine will be built from scratch. No previous World Cup has required so much new building. Moreover, afterwards, modular sections from the stadiums will be used to construct 22 stadiums around the world in developing countries, which represents a remarkable logistical challenge in its own right.

Design pictures of the stadiums show that just putting up soulless arenas is not going to be enough for Qatar: each one of the envisaged stadiums is a striking architectural achievement. Doha Port Stadium is positioned resplendently in Doha’s bay, with dhows able to pull in to ornate quays around it. The Al-Gharaffa Stadium in Al-Rayyan, a major renovation, looks like a huge, multi-coloured, woven basket. The Al-Shamal Stadium is styled on a traditional dhow fishing boat, a swoop of curved teak. Al-Khor Stadium is a sweeping teardrop of a structure, modelled on a seashell; Umm Slal is styled on a nearby fort; Al-Wakrah is a lattice bowl somewhat reminiscent of the Bird’s Nest stadium from the Beijing Olympics. The final will be held in the Lusail Iconic Stadium , encircled by a moat crossed by six bridges. The claim is that all of these stadiums, despite being air conditioned, will have a zero carbon footprint because of their use of solar power.

Besides the stadiums, 90,000 hotel rooms will be required, plus the infrastructure to support 400,000 fans. This is where the lines start to blur: all fans will use a new multi-billion dollar local and national train system, though this is not being built purely for the World Cup itself, and will have continuing utility after the tournament has gone. “It is necessary here that a clear distinction between previously planned infrastructure projects initiated and undertaken as part of the state’s Urban Development Masterplan be made, whose projected costs lie between $60 and 100 billion and would have occurred irrespective of Qatar winning the rights to host the World Cup,” says Al Khater. And as the Middle East research group MEED notes: “As Doha gears up for the World Cup, most eyes will be on the stadiums and other facilities that will be built above the surface, but most of the real work will be going on underground.”

But one thing the World Cup does do is deliver a deadline, whether or not the infrastructure in question has a longer-term need. “The interesting point about the World Cup infrastructure is it has to be built on time,” says Ian Kennedy, founder and director of the Institute for Infrastructure Studies, which has opened in Doha. “It would be easier to delay infrastructure if it things were not going according to plan were it not for the tournament. The completion of infrastructure projects is challenging, and most run late and over budget. This has to be nailed down and completed on time.” Al Khater agrees: “The tournament simply acts as a catalyst – a firm deadline for the State to achieve its developmental objectives.”

As yet, there’s little evidence of stadium development being underway, although land is being cleared for the railways and local mass rapid transit system that will serve them following the June award of $8.2 billion of contracts around the metro system. Still, contracts are beginning to be awarded on the vast supply chain that must come together to host the games. Clifford Chance, for example, announced in March that it had been appointed by the Supreme Committee for Qatar 2022 to advise on its Technical Programme, which includes advising on the development of the main Iconic Stadium in Lusail, which will hold over 85,000 people. Andrew Longmate, who is General Counsel for the Supreme Committee, called it “the first of a number of major legal advisory mandates that will be tendered over the coming months.”

Elsewhere, Aecom Technology Corporation was appointed in May to offer design consultancy and construction supervision for the Al Wakrah Stadium in Doha. Zaha Hadid was chose as architect.

“Several appointments programme-wide and stadium-specific have already been made and more are soon to follow,” says Al Khater. “Early earthworks will begin on our first stadium site in Q4 2013 or Q1 2014.”

Funding is likely to be largely through the state, but Qatar argues the knock-on benefits will be felt throughout society and the economy. “Commercially, the opportunities in the field of sport are endless,” says Al Khater, who says the Middle East is “an untapped market of enormous potential for FIFA and global football” with a young and vibrant population. He cites an AT Kearney survey from 2011 valuing the global sports industry at $625 billion with the bulk of growth from new and developing markets which have an expected annual growth rate of 7%. Then there’s tourism and hospitality. The Qatar bid committee commissioned Grant Thornton to study this, and found that the value of these sectors in the Middle East alone was about $655 billion, contributing 8.6% of GFP. It expected that number to climb to $2 trillion and 10%, which in turn beings greater economic diversification.

So what does it say about Qatar’s development and wealth that this small country, which many westerners would have struggled to find on a map 10 years ago, can attract one of the world’s two largest events?

“It says that the international football community believed that the FIFA World Cup could be a transformational event in shaping the region’s future, acting as a catalyst for the development of Qatar’s infrastructure, its society, and most importantly its citizenry,” says Al Khater. It will do so by spurring development in industries in their infancy in the region, from renewable energy to commercial sport and hospitality, “establishing sustainable industries beyond 2022 that have lasting employment opportunities”; developing technology to allow people to enjoy outdoor spaces 12 months of the year; and by using football “to foster knowledge and understanding towards the region and to break down social barriers and misconceptions.”