Qatar said it will invest £5billion in the UK over the next five years, deepening the countries’ trade ties ahead of aBrexit breakaway from Europe.
Chief executive officer of the Qatar Investment Authority, Sheikh Abdullah Bin Mohammed Bin Saud Al-Thani said: “In our last strategy session we committed a big amount of investment in the U.K., especially in infrastructure.
“There is a pressure from my board to diversify in terms of geography and asset class, but we are still looking, even after Brexit, for opportunities.”
He disclosed no further details beyond the sum of the planned investment and its timeline.
A delegation of more than 400 Qatari officials and business executives, led by the emirate’s prime minister, is visiting London and Birmingham for a two-day meeting with U.K. counterparts, according to Qatari government statements.
The visit concludes on Tuesday, a day before U.K. Prime Minister Theresa May plans to start the two-year clock on Brexit negotiations by invoking Article 50 of the Lisbon Treaty.
Qatari investments would help to cushion the economic fallout from Brexit on both sides. Ahead of the break, the U.K. is taking steps to maintain foreign investments, going as far as to provide written assurances to Nissan Motor Co. in an effort to stem competition from other EU members that want to poach talent and capital.
Big Stake
Qatar, too, has a big stake in keeping the U.K. economy and asset prices strong during and after Brexit. It’s the world’s biggest producer of liquefied natural gas, and delivers 90 percent of the U.K.’s imports of the fuel. The emirate stepped in to invest billions in Barclays Plc during the global financial crisis and has built up a stock and real estate portfolio worth more than 40 billion pounds over the past decade.
Rachel Pether, an adviser at the Sovereign Wealth Fund Institute, said: “Qatar doesn’t see Britain leaving the EU as impacting their relationship and it may be an opportunity for it to be stronger.”
Qatari Prime Minister Sheikh Abdullah bin Nasser bin Khalifa Al-Thani confirmed that approach.
He said: “Qatar has great confidence in the U.K., and this confidence will be demonstrated in the additional investments we will make over the next decade.”
He disclosed no details about prospective deals.
The delegation to the U.K. includes chief executive officers of Qatar Petroleum and Qatar Airways. George Iacobescu, Chairman and CEO of Canary Wharf Group, partially owned by QIA, and Xavier Rolet, CEO, London Stock Exchange Group Plc, another portfolio company, are also attending the investment forum.
“If you ask anyone here they won’t have any clue at what’s happening in this economy,” Al-Thani, the chief executive officer of the Qatar Investment Authority, said of the U.K. But “the long holding of our positions gives you a sign of our satisfied return,” he added.
Protecting the value of Qatari assets in the U.K. — which range from Harrods department store, a stake in J Sainsbury Plc and tony properties such as Savoy Hotel and the Shard skyscraper — isn’t the only motivation behind the emirate’s road show. Lower oil prices have sapped government revenue, forcing Qatar, the richest country in the world on a per-capita basis, to issue $9 billion bonds in May. Officials are seeking more investment flows as the country diversifies its economy away from oil and gas and continues a $200 billion infrastructure upgrade before the 2022 World Cup.
Fahmi Alghussein, CEO of Doha-based asset manager Amwal LLC said: “We want to attract institutional money from the U.K., especially through our forthcoming exchange-traded fund that will list on the Qatar Stock Exchange.”
One indicator of Qatari appetite for investment in the U.K. is continued purchases of real estate, both by the state fund and individuals. Foreign investors see the top end of London’s property market as an attractive haven, with the pound’s slump offsetting political uncertainty, according to Laurence Ronson, sales director at Ronson Capital Partners.
He said: “London looks like exceedingly good value in terms of a weakened sterling.”
Ronson, who is developing two luxury buildings in the capital, added: “We’ve seen that with Chinese, Middle Eastern and American money looking at opportunities. All the doom and and gloom that has been predicted post-Brexit has not happened. In fact, the economy is growing.”