Qatar has been one of the fastest-growing economies in the world during the last decade. Economic growth has averaged 16% over the past decade and GDP per capita has reached approximately $100,000, making it one of the wealthiest countries in the world. Its massive base of oil and gas has provided a solid basis for its thriving economy and, unlike other GCC countries, it is less leveraged, has fewer special flows or mass tourism, and hence is less integrated in the global economy, putting it in a stronger position in this current challenging financial environment. 
However, this high dependency on revenues from the hydrocarbon industry has pushed the government to pursue a vigorous policy of diversification to alleviate the pressure of depending entirely on that one sector.
An essential part of this policy has been to encourage and support the development of its banking system and use it as a channel through which liquidity is provided to the private sector and the emerging businesses in the country, away from the oil and gas sectors. Sectors that were barely on the horizon a few years ago, such as real estate and construction, have become major drivers of growth. 
This is the first in a series of articles to be published in Gulf Times examining to what extent the banking sector has been successful in aiding the diversification of the economy.
These articles will delve into the history and development of the financial system by enquiring into its evolution and structure, the economic performance of the system and the relative positioning of the various participants, as well as the challenges facing the system. 
This will be followed by a discussion of the impact of banking on the economy and its ability to contribute to the diversification policy. 
The evolution and role of money exchange companies, which provide a significant service to the expatriate community, will also be investigated. An analysis would not be complete without detailing the development and role of the Qatar Central Bank as the ultimate institution responsible for the banking system and the financial system of the country in general.


lDr Abdulaziz A al-Ghorairi is senior 
vice-president and chief economist, 
Commercial Bank