Qatar - Defense, Aerospace, and Security

Defense, Aerospace, and Security

Last published date: 2024-07-29

The relationship between the United States and Qatar continues to thrive, with cooperation in the defense, aerospace, and security sectors a cornerstone of the bilateral relationship. These sectors are expected to remain best prospects for U.S. businesses for years to come.

Overview

Defense

As Qatar continues to manage an ambitious military modernization program, the Qatar Armed Forces rely on foreign military sales (FMS) and direct commercial sales (DCS). At the U.S. Embassy in Doha, FMS purchases are facilitated through the Office of Military Cooperation, while DCS purchases are through the U.S. Commercial Service. Major purchases since 2014 include Apache helicopters, Javelin missiles, early warning radar, PAC 3 Patriot systems, and F-15-QA fighter aircraft. In late 2021, Qatar received its first shipment of F-15-QA planes from Boeing. The Qatari military sponsors an initiative to create a vast network of military training facilities and programs to support its recent defense acquisitions.

A homegrown player in the Qatari defense sector is Barzan Holdings (Barzan). Barzan was launched in March 2018 and is wholly owned by the Qatari Ministry of Defense. Barzan acts as the procurement and commercial arm for Qatar’s Ministry of Defense on strategic projects, and has offices and investments abroad, including in Charleston, South Carolina.

The U.S.-Qatar military strategic partnership has made great strides since 1992. The United States and Qatar signed a Defense Cooperation Agreement in 1992, which was renewed in 2013 for an additional ten years. Al Udeid Air Base, the largest U.S. airbase outside the United States, serves as a forward headquarters for U.S. Central Command and Air Force Central Command. Between August and December 2021, Qatar supported the transit of tens of thousands of evacuees from Afghanistan at Al Udeid Air Base, deepening the relationship between Qatar and the United States. In 2022, President Biden designated Qatar as a Major Non-NATO Ally (MNNA), a special designation under U.S. law that provides foreign partners with certain benefits in the areas of defense trade and security cooperation. The MNNA designation is a powerful symbol of the close relationship the United States shares with Qatar and demonstrates deep respect, friendship, and partnership between the two countries. While MNNA status provides military and economic privileges, it does not entail any security commitments. Nonetheless, U.S. companies stand to benefit from the MNNA because it could further increase defense cooperation. In November of 2022, the State Department approved a Foreign Military Sale to the Government of Qatar of the Fixed Site-Low, Slow, Small Unmanned Aircraft System Integrated Defeat System (FS-LIDS) System of Systems and related equipment for an estimated cost of $1 billion. The proposed sale will improve Qatar’s capability to meet threats by providing electronic and kinetic defeat capabilities against Unmanned Aircraft Systems.

Qatar has also expressed interest in exploring outer space; it recently observed the Sprint Advanced Concept Trainings (SACT) organized by U.S. Space Command in Colorado Springs. The exercise is designed to improve collaboration between USSPACECOM and its components, allied- and partner-nation space enterprises, and the commercial space industry. Qatar signed a joint cooperation project with the National Aeronautics and Space Administration (NASA) to design and launch a specialized satellite to study the effects of climate change, water resources, and the impact of rising sea levels on the desert in the Arabian Peninsula. The satellite is expected to launch in 2025.

Cybersecurity

Qatar made significant investments in cybersecurity to support the 2022 FIFA Men’s World Cup. Despite its relatively small population, the market saw some of the fastest growth in cybersecurity spending in the GCC in 2022. The new Ministry of Communications and Information Technology (MCIT) launched ‘Tasmu,’ the Smart Qatar initiative. The program pledges to transform Qatar into a smart city leader in the Middle East. Because of Tasmu, public sector requirements for cybersecurity will increase; Qatar’s implementing of e-government and digitization solutions will facilitate public sector investment in cyber-solutions. The Qatari cybersecurity market was estimated at over $1 billion in 2022 and is expected to reach $1.6 billion by 2026.

Aerospace and Aviation

Qatar has continued to strengthen its aviation position globally via its national carrier, Qatar Airways. The airline has a strong footprint in the United States, operating twelve direct routes, having a codeshare alliance with American Airlines, and a partnership with Alaska Airlines. Qatar Airways is one of largest cargo carriers in the world. In 2022, during President Biden’s meeting with Amir Sheikh Tamim Bin Hamad Al-Thani, a deal between Boeing and Qatar Airways Group was signed that includes a $20 billion sale of 777 cargo freighters and a $7 billion order for 737 MAX passenger aircraft.

Qatar Airways Group had a stellar 2022, reporting a net profit of $1.21 billion during its 2022/23 fiscal year. It carried over 31 million passengers, a growth of over 70 percent compared to 2021. Qatar Airways Cargo remains a global powerhouse, its cargo facility in Doha received the IATA Smart Facility Operational Capacity Certification (SFOC) in 2023. In 2023, the cargo division also launched its first cargo hub outside Qatar, in collaboration with Rwanda’s national airline RwandAir in Kigali (Qatar Airways Group owns a 49 percent stake in RwandAir). According to its CEO, Akbar Al Baker, the airline may continue expanding its number of destinations by more than 25 from 170 under plans for rapid growth.

Aviation is an important industry in Qatar for U.S. suppliers. Boeing and Gulf Stream dominate the market, but other U.S. suppliers provide information technology, ground support equipment, and similar services to Qatar Airways and its hub, Hamad International Airport (HIA).

Safety and Security

In the safety and security sector, Qatar enjoys a strong security partnership with the United States. The secure and successful execution of the 2022 FIFA Men’s World Cup demonstrated the effectiveness of the collaboration. Looking to the future, this relationship will continue to grow to support Qatar’s oil and gas North Field Expansion project and upcoming sporting events to be hosted in Doha.

Driven by the rising global demand for natural gas and record prices for oil and gas, Qatar enjoys a strong economy. The North Field Expansion will increase Qatar’s liquified natural gas production by 64 percent by 2028, the expansion investment will reach approximately $29 billion. This rapid expansion will require the protection and safeguard of new strategic infrastructure, requiring sophisticated security systems. In addition to major gas facilities and desalination plants, Qatar continues to secure and improve systems in the airport, the electrical grid, and other critical infrastructure assets. The Ministry of Interior is the main actor in security related regulations and implementation.

Aside from energy, the facilities management industry offers opportunities for companies providing solutions in physical security, surveillance, access control, and fire protection products and services. The facilities management market in Qatar is estimated at over $5 billion, with growth projections reaching up to $22 billion by 2030. This growth is driven mainly by upcoming sporting and business events, and the various programs to reach Qatar National Vision 2030.

Sub-Sector Best Prospects

For defense, over the last decade, the most purchased items in the defense sector include anti-ballistic missile systems and a new generation of fighter aircraft. Military electronics and cyber-systems, helicopters, light tactical armored vehicles with weapons systems, guided air-to-air and air-to-ground missiles, fighter jets, and air defense systems are also common purchases.

In recent years, budgets centered on security and defense equipment, training, and procuring technologies needed to host the 2022 FIFA Men’s World Cup. The spending will shift focus, post-World Cup. There are niche opportunities for solutions that can add value and efficiency to existing programs. Interoperability, integration, and communication systems are areas of potential growth.

Opportunities in Defense

Integrated air and missile defense systems.
Navy & marine defense systems.
Space and satellites.
Training and capacity building programs.
Cybersecurity and electronic warfare systems.
Local Manufacturing: To support Qatar National Vision 2030, the government seeks successful partners that can help develop local manufacturing capabilities and transfer knowledge to entities such as Barzan Holdings.