Skip to main content

Qatar has pledged to invest 4.7 billion euros ($4.9 billion) in Spain as the European country launches an economic overhaul with its share of European Union pandemic recovery funds

Qatar’s Emir Shekih Tamim bin Hamad Al-Thani announced that the energy-rich Gulf state would increase its investments in Spain during a state dinner with Spain’s King Felipe VI on Tuesday evening .

Details of the investments were not made public beyond the Spanish government, saying they would help ensure the country’s “energy security” and its transition to a “green economy”.

But as Europe scrambles to find alternatives to Russian energy, Qatar has turned to a source of liquefied natural gas given its huge gas reserves.

The Emir and Spanish Prime Minister Pedro Sánchez met in Madrid on Wednesday and signed 12 agreements to consolidate stronger bilateral relations. The agreements covered topics ranging from economy and trade to education, military cooperation, health and science.

The leaders’ meeting took place on the second day of the Emir’s state visit to Spain, which included the first Spain-Qatar business forum.

“In the current international context of the conflict in Ukraine, this new bilateral strategic relationship with Qatar becomes even more important for Spain for reasons not only of investment but also of energy security,” the Spanish government said in a statement. .

Spain leads Europe with six liquefied natural gas processing plants in its ports. Beyond the ambition to diversify its own energy mix, Spain is striving to become an energy hub for Europe.

The investments will be made by the sovereign wealth fund Qatar Investment Authority and channeled into projects by the Spanish public finance authority COFIDES “to find investment opportunities aligned with” the country’s plans to use the recovery funds of the EU, said the Spanish government.

Spain, which received the second-largest allocation from the EU behind Italy, plans to deploy 70 billion euros ($74 billion) in direct transfers from the EU over the period 2021-23 . It is set at an additional 70 billion euros in European loans between 2023 and 2026.

Spain is rolling out a series of major public investment projects using its share of EU pandemic recovery funds, which the Prime Minister likened to a “Marshall Plan for Europe”.

With a strong focus on sustainability and digitalization, the projects are designed to encourage major private sector investment. They include a push to promote electric cars in Spain and for the development of green hydrogen as a clean energy source.

The Spanish government said Qatari money would “provide a flow of investment into Spain for its green and digital economy projects”.

Despite galloping inflation made worse by Russia’s invasion of Ukraine, Spain is still expected to see its economy grow by 4% this year.