According to the chief economic adviser of the Qatar Financial Centre (QFC), Islamic finance will need to play a pivotal role in meeting the increasing demand for funds by the Gulf Cooperation Council (GCC). Dr Haitham al-Salama said oil prices are not likely to exceed $100 in the near future and are forecast to stay around the $55-$65 per barrel. Also, a spike in the shale oil production is expected, which will push the prices down. He added that this puts further emphasis on the economic diversification efforts of oil producing countries, particularly in the GCC. Qatar has already taken various measures to diversify the economy, which includes lowering the subsidies and cost optimisation apart from prioritising planned spending. Finance Minister HE Ali Sherif al-Emadi had recently said Qatar would be spending another QR46bn in 2017 to upgrade its infrastructure in the run up to 2022 FIFA World Cup.
A consultation paper released this week announces a proposal by Qatar's regulator for extending its ban on onshore banks operating Islamic windows in order to make financial institutions part of the Qatar Financial Centre (QFC). Islamic windows enable conventional banks to offer Islamic financial services. The only prerequisite is that clients' money is segregated from the rest of the bank. An extension of the ban is expected to prevent conventional banks from taking advantage of the QFC.