What Does Qatar's Change in Leadership Mean for Its SWF?

I had an unexpected holiday from teaching at Qatar University yesterday when it was announced that Sheikh Tamim bin Hamad Al-Thani was taking the reins from his father Sheikh Hamad, and a public holiday was declared to celebrate the transfer of power.   What will this mean for the Qatar Investment Authority?  I have more questions than answers:

  • QIA’s leadership structure may change.  It has just been announced that Sheikh Hamad bin Jassim Al-Thani (or “HBJ”, as he is sometimes called) is no longer Prime Minister of Qatar, and Qatar’s Minister of State for Interior Affairs, Sheikh Abdullah bin Nasser bin Khalifa Al Thani, will take his place.  It is not clear if HBJ will continue to serve as Foreign Minister, or whether he will continue to serve as the de facto head of the Qatar Investment Authority and its subsidiaries.  
  • This connection between the head of the foreign policy arm and its investment arm is significant: although SWFs have seemed to avoid the kind of baldly political investments that some worried would occur, there are a few SWFs, such as QIA, where the fund is used as part of a set of integrated foreign policy tools.  The fund is not used to, say, spy on another country or destabilize it in some way (that happens, of course, but is typically done through other means).  Rather, the fund may be used to create or reward cross-border investment with other countries.  As someone put it to me, “you buy our oil/gas, we invest in you.”  Will this kind of policy linkage continue?
  • As a more general matter, will Sheikh Tamim bin Hamad follow the same path as his father in internal and external politics?  It has been suggested in official statements and by news media here that he will likely lead the country in a similar style, but that he is going to bring some fresh perspectives to the role and, according to some, may accelerate towards a democratic constitutional monarchy.
  • How will Qatar’s Gulf neighbors react to the change, and how will this affect partnering between the QIA and other Gulf funds like KIA and ADIA?  Saudi Arabia and the UAE have been apprehensive over Qatar’s support of the Muslim Brotherhood,  and more senior leaders (and by that I just mean “the old guys”) in other Gulf states are likely not ecstatic with Qatar’s shift in power to such a young sovereign.  However, I suspect that the change will not create a significant shift in policies or relations among the funds themselves.