Qatar will invest £1bn in the UK’s climate technology sector as part of a “milestone” agreement set to bring “decades of innovation”.

The partnership is expected to create thousands of highly skilled jobs and see the launch of climate technology hubs across both nations, the UK Government has said.

Part of the cash boost will go into tech programmes, carried out by Rolls-Royce, that improve energy efficiency, support new sustainable fuels and lower carbon emissions. 

Prime Minister Keir Starmer said the partnership “is a significant step in our [the UK’s] ambition to become a clean energy superpower” and will attract further foreign investment.

The cash injection will also go into start-ups in the UK and Qatar focusing on energy efficiency, carbon management, and green power.

Prime Minister of Qatar Sheikh Mohammed Abdulrahman al Thani said: “We are delighted to formally launch this groundbreaking partnership. The United Kingdom has a proud history of innovation in cutting-edge technology, and Qatar has long been a trusted investment partner to British businesses. This new collaboration aligns with our long-term strategy to invest in the economies of the future.

“We welcome the formalisation of our strategic relationship with Rolls-Royce. Qatar is already one of the largest purchasers of Rolls-Royce engines for Qatar Airways and a major investor in the small modular reactor nuclear industry. This new partnership further strengthens Qatar’s position as a leading global investor in climate technologies.”

The climate tech hubs are expected to be delivered in partnership with universities, industry, free ports and the Qatar Free Zone (QFZ).

QFZ are areas within Qatar that offer special economic incentives and regulatory advantages to encourage foreign investment.

Sites in Qatar will also enable start-ups to access markets and opportunities in both countries, allowing for further inward investment.

Business secretary Jonathan Reynolds said: “Increasing investment in the UK is a mission at the heart of this government. This partnership between Rolls-Royce and Qatar is not only a huge vote of confidence in the UK but will also help create thousands of highly skilled jobs. 

“Our commitment to becoming a clean energy superpower is steadfast, and investments like these make a huge contribution to bolstering the UK as a leader in climate technology. We’re showing investors that Britain is back as a stable place to do business, helping to secure the investment needed to make every part of our country better off.”

Starmer met the Amir of Qatar Sheikh Tamim bin Hamad Al Thani in Downing Street to mark the agreement.

The Amir is on a state visit to the UK and has met King Charles and Queen Camilla, as well as opposition leader Kemi Badenoch and celebrities such as David Beckham.

The two countries have also unveiled plans to set up a shared Genomics Medicine Academy, and a joint commission on AI research.