Qatar losing the 2022 World Cup could be a huge blow - but not in the way you'd think

All eyes are on Qatar and whether it will be stripped of its ability to host the 2022 World Cup, after several high-ranking FIFA officials were charged with racketeering and corruption.

So far there have been no suggestions of bribery in the award of either the Russia or Qatar tournaments, but there are fears that the FBI's investigation into alleged corruption at FIFA, which involves charges related to more than $150 million (£97 million) in alleged bribes and kickbacks, could soon encompass both tournaments.

This could have big implications on Qatar's economy - but not because it's relying on billion dollar stadiums to get its economy moving. Bank of America Merrill Lynch's economist Jean-Michel Saliba says direct World Cup-related spending (stadiums and hotels) is small at approximately $16 billion (£10.4 billion) and is only worth an annual 1-1.5% of GDP over the period.

In fact, given that oil prices have fallen so much it would in fact be "credit positive" if Qatar didn't spend so billions building stadiums in the desert.

But while losing the games could help in the short term, the indirect impact of losing the World Cup could be hugely negative.

Saliba says as much as $30 billion (£19.5 billion) worth of infrastructure projects could be put at risk if the tournament is lost. This would be a huge blow for Qatar's ambitions to transform itself from an oil rich Gulf state into a country with global clout like nearby United Arab Emirates.

Transport links, ports, and even a new city planned for the World Cup were all part of that vision. Saliba says the tournament "provides impetus to the non-oil economy."

Saliba says:

"Hypothetically, an illustrative, arguably arbitrary, scenario where the direct World Cup capex is cancelled and the transport, metro, and Lusail City projects are downsized could put US$30bn, or roughly 20% of the capex pipeline, at risk.

"This would be 17% of GDP, or 2.5% of GDP annually. Such a scenario would suggest a 0.6pp annual drag on real GDP growth, assuming a low multiplier of 0.3 of real spending to real non-oil GDP."

Still, BAML says that Qatar's World Cup direct capital expenditure "woes," in the event of it being stripped of hosting the World Cup, are "overstated." Instead we should be focusing on the long term impact.