Economy Economic Growth and Gross Domestic Product (GDP) One of the main aims of Qatar National Vision 2030 is to diversify the economy and reduce dependence on the hydrocarbon industries.
Economy
The economy has weathered the impact of both the COVID-19 pandemic and the blockade that was imposed on 5 June 2017, with positivity after borders reopened between Saudi Arabia and Qatar following the AlUla Declaration in January 2021. Hydrocarbon exports were not affected. Qatar's Economic Outlook Report 2021–2023, released by the Planning and Statistics Authority (PSA) in January 2022, estimates that the economy will recover in 2021 by 1.5% to 2.3%. It is expected to recover further in 2022, between 1.6% and 2.9%, mostly from the recovery of non-oil activities, with a growth rate of 2.8% to 4.7%. GDP growth of between 1.5% and 2.3% was expected in 2021, and is expected to rise to between 1.6% and 2.9% in 2022 before stabilising in 2023 to between 0.7% and 1.8%. Due to the optimistic forecasts for the stability of oil and gas prices during 2021–2023, it is possible that the public finances will achieve a surplus of between 1.9% and 3.6% of GDP. According to PSA, Qatar’s quarterly Gross Domestic Product (GDP) at current prices was QAR176.23 bn in Q3 2021, up 40.6% year-on-year (y-o-y) and up 12.8% against the Q2 2021 revised estimate of QAR156.29 bn. The quarterly GDP at constant prices was QAR168.13 bn, an increase of 2.6% y-o-y and up 4% against the Q2 2021 revised estimate of QAR161.71 bn.
Export, Import and Trade Surplus
Imports of goods in December 2021 was around QAR9.9 bn, an increase of 16.2% y-o-y, and an increase of 1.7% m-o-m. China was the main country of origin. The foreign merchandise trade balance – the difference between total exports and imports – showed a surplus of QAR25.7 bn, an increase of QAR17.1 bn or 198.9% y-o-y, and an increase of nearly QAR1.2 bn or 4.7% m-o-m. QATAR BUSINESS AND ECONOMY E-GUIDE ©
The State Budget for 2022 was announced in December 2021, been based on a conservative average oil price of USD55 a barrel, up from USD40 in the 2021 budget. HE Ali bin Ahmed Al Kuwari, the Minister of Finance, stated this was thanks to a recovery in global energy prices. The oil revenue for 2022 has been estimated at QAR154 bn, up 26.6% on the previous year. Despite the implications of the COVID-19 pandemic on the global economy during the last two years, the State budget sees a significant increase compared to the previous year. There is an increase in revenues by 22.4% to QAR196.1 bn and an increase in expenditure by 4.9% to QAR204.3 bn, largely due to a temporary increase in current expenditure related to the hosting of the FIFA World Cup Qatar 2022TM. This gives a budget deficit of an estimated QAR8.3 bn, to be covered by the Ministry of Finance (MOF) from available resources or via debt instruments in domestic and international financial markets, as required. The 2022 Budget shows that QAR74.0 bn has been allocated for major projects. The State will continue work on development projects related to infrastructure, citizens’ land development and public services. As seen in previous budgets, investment continues to focus on the education and healthcare sectors. Allocation for the education sector is QAR17.8 bn (8.7% of total expenditure), some of which will be directed towards the expansion of schools and educational facilities. There is QAR20 bn (9.8% of total expenditure) for the healthcare sector, for a number of projects and initiatives to improve the quality of healthcare services.
Inflation and Cost of Living For December 2021, the Consumer Price Index (CPI), used to calculate inflation rates in Qatar, reached 102.14 points, an increase of 0.65% m-o-m and an increase of 6.47% y-o-y. The Qatar Economic Outlook from PSA states imported and domestic inflation of 2%-3.5% is expected during 2021–23.
Population and the Labour Force Total population in January 2022 was 2,791,925: males 2,011,530; females 780,395. The Labour Force report for Q2 2021 showed the number of salaried workers decreased by 1.7% and the unemployment rate was 0.1%. m
Checked & Updated February 2022
In December 2021, the total exports of goods (including exports of goods of domestic origin and re-exports) amounted to around QAR35.6 bn, an increase of 107.8% y-o-y, and an increase of 3.8% month-on-month (m-o-m). The y-o-y increase was mainly due to higher exports of Petroleum gases/ other gaseous hydrocarbons. China was the main country of destination.
The Budget
Sources of information: International Monetary Fund (IMF); Ministry of Finance (MOF); Planning and Statistics Authority (PSA); Qatar Central Bank (QCB)
MARHABA
14 EGUIDE M83 ECONOMY.indd 1
4/5/22 2:49 PM
