Qatar has postponed plans to build a new chicken farm complex that would have helped bolster its food security, according to a company that would have helped finance the project.
Doha-based private bank Investment House had been working to raise some QR750 million (US$206 million) through a planned initial public offering (IPO) for a company that aimed to nearly quadruple the amount of home-grown poultry and eggs in Qatar.
The farm was part of a wider strategy to increase the amount of locally produced foodstuffs to reduce Qatar’s current overwhelming reliance on imported produce.
Through the IPO, Investment House had planned to raise around half of the total amount of funding required for the 5.7 sq km complex, which would have had the capacity to produce up to 40,000 tons of chicken and 7.5 tons of eggs each year.
The rest of the funding would ideally have come from private investors, the government said in an announcement made in December.
However, earlier this week Investment House CEO Hashem Al-Aqeel was quoted by Reuters as saying that it had been ordered by regulators to put its flotation plans on hold.
While he did not give a reason for the move, or a new timeline for the IPO’s launch, the announcement comes amid a period of belt-tightening in Qatar, as a number of projects not directly related to the 2022 World Cup have either been shelved or scaled back.
This is in part due to the sudden drop of oil prices since last June, which are also forecast to bring down gas prices in the coming year.
“The lower oil price is affecting Qatar – we are seeing a slowdown in the rate of investment here in the construction, banking and energy sectors,” Al Aqeel told Reuters.
The poultry farm isn’t the only project on hold.
Designed to deal with Doha’s increasing traffic issues, the project involving building a series of tunnels and bridges to connect Hamad International Airport, Katara Cultural Village and the Dafna/West Bay business district.
MEED previously put a price tag of around $12 billion on the project.
News of the postponement came just a week after Qatar’s government established a ministerial committee to oversee projects of “strategic importance.” The committee was tasked with prioritizing major development initiatives and reviewing costs, among other responsibilities.
Meanwhile, a leading regional project delivery specialist has predicted that the fall in oil prices would encourage alternative funding schemes in Qatar in the coming years.
Dr. Mamoon Alameen, who will speak at the Project Qatar conference next month, recently said he believed the decline in prices would not affect the key infrastructure projects already underway for 2022.
“It may, however, catalyze PPP (public-private partnerships) in many sectors,” he added in a statement.