Qatar is well-positioned to benefit from artificial intelligence-boosted productivity gains in its labour market and the private sector plays a critical role in advancing the AI adoption, according to the International Monetary Fund

Qatar is well-positioned to benefit from AI (artificial intelligence)-boosted productivity gains in its labour market and the private sector plays a critical role in advancing the AI adoption, according to the International Monetary Fund (IMF).

"The country's proactive approach in enhancing digitalisation and embracing AI have bolstered its digital access and AI readiness, facilitating a rapid increase in AI exposure and labour force AI preparedness," the IMF said in its latest Article IV consultation report.

Highlighting that the country’s increased AI exposure is expected to bring more AI-driven productivity gains than risks; the Bretton Woods institution said its expatriate-dominated labour structure also allows the country more flexibility in adjusting its labour force for swifter AI adoption.

Asserting that the private sector plays a critical role in advancing AI adoption, creating job opportunities that align with AI's transformative potential; it said private sector's dynamism is pivotal in generating high-skilled employment that could better leverage AI, thereby contributing to future productivity gains.

Estimates suggest that further AI adoption in Qatar could significantly boost productivity, with potential gains varying based on factors such as speed of adoption and labour force exposure.

"However, it is important to recognise that despite the overall advantageous position of Qatari workers, those who are employed in the public sector with clerical positions are more susceptible to job displacement risks associated with AI," it said.

Highlighting that efforts to deepen digitalisation and AI adoption should strengthen with policies in place to address potential job displacement risks; IMF said the government could enhance digital skills of the labour force through targeted upskilling and reskilling programmes and digital talent attraction schemes for expatriate workers, facilitate job transition including from the public to the private sector to mitigate job displacement risks, and develop adequate and well-targeted social safety nets to support vulnerable groups.

The report found that successful AI adoption could generate considerable gains in labour productivity. With the focus on private sector growth, continued investment in human capital and efforts to attract high-skilled expatriates, Qatar’s labour force may enjoy more opportunities than risks.

Several NDS3 (Third National Development Strategy) “enabling clusters” are well positioned to harness AI-driven productivity gains, it said, adding NDS3 identifies IT and digital, financial services, and education as the ‘enabling clusters’ that support diversification efforts.

By matching the occupational composition of each economic sector in Qatar with the AI exposure-complementarity matrix, the IMF analysis found that the ‘enabling’ sectors concentrate in the high AI exposure and complementarity quadrant indicating that they are better positioned, compared to other sectors, to benefit from productivity gains from AI adoption.

In contrast, key ‘growth clusters’ identified in NDS3, such as manufacturing, logistics, and tourism have limited exposure to AI and hence remain largely shielded from both risks and opportunities related to the technology.

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