The Qatar Investment Authority (QIA) has pledged to invest US$5 billion into the Spanish economy, emulating Abu Dhabi sovereign wealth fund Mubadala’s multi-billion dollar bilateral deals.

The plans were announced on Tuesday by Qatar’s Amir Sheikh Tamim bin Hamad Al Thani during a dinner in Spain hosted by King Felipe VI. Consort of the Amir Sheikha Jawaher bint Hamad Al Thani was accompanying the Qatari leader during the visit.

According to the Qatar News Agency, Qatari investments in Spain total more than US$22 billion. QIA is set to invest in projects backed by the European Union’s Covid-19 recovery fund.

On Wednesday, Spain’s state-owned investor Compañía Española de Financiación del Desarrollo  (Cofides) signed an MoU with QIA to identify potential joint investment opportunities in both Spain and Qatar. Cofides is 54% owned by Spanish public agencies, and 46% owned by private banks including Santander, BBVA and Sabadell. The focus is tech-enabled sectors, as well as sectors supporting energy transition initiatives, including renewable energy, clean transportation, and the circular economy.

Cofides’ Chairman, José Luis Curbelo, said: “By combining COFIDES expertise in business development and QIA’s long-term investment perspective, both institutions leverage their strengths for the successful implementation of this agreement, which should translate in sound investments aligned with Spain’s economic strategy”.

QIA interest in Spain comes just months after Abu Dhabi sovereign fund Mubadala  forged bilateral relationships to look to common interests, particularly in relation to the development of the Spanish economy, in energy transition, sustainable mobility, transport, circular economy, digitization, biotechnology and agribusiness. Indeed, the QIA deal appeared to be a replay of Mubadala’s efforts in February. Cofides president José Luis Curbelo said the UAE “offers investment opportunities in areas such as infrastructure and transport, tourism and renewable energies, in which Cofides has extensive and extensive experience”.

Mubadala has entered a number of bilateral deals involving sovereign funds, indicating that it is an element of Abu Dhabi’s soft power as it seeks to cement economic and political alliances. Mubadala has signed sovereign investment partnerships with the UK, China, France, Russia, Greece and Kazakhstan. QIA’s deal with Spain appears to be an answer to the deal, indicating that the tensions between Qatar and its neighbours may not have dissipated.

In September 2021, Mubadala indicated that it was scaling up its plans under the UAE-UK Sovereign Investment Partnership (UAE-UK SIP) with the GBP5 billion (US$7 billion) investment framework agreed in March boosted to GBP10 billion (US$14 billion) over the next five years.

SIPs focus on tech, infrastructure and energy transition – areas where Mubadala has already made significant investments in the UK over the past decade. Global SWF’s investment tracker for Mubadala shows that infrastructure including renewable energy represents 47% of the value of its investment in the UK.

Related funds QIA
Related tags VC