Qatar’s external surpluses on balance of payments’ current account will stay in double digits, the General Secretariat for Development Planning (GSDP) said. It estimated the surplus to be 22% of the nominal GDP this year and 20.6% in 2013.
Qatar’s current account surpluses will continue adding to the net international investment position and supporting the accumulation of funds for future
The growth of export revenue will slow as production of oil and gas plateaus but import demand will keep rising, both to meet project needs and support a larger population, the GSDP said. “Qatar’s current account surpluses will continue adding to the net international investment position and supporting the accumulation of funds for future,” the GSDP said in its “Country Outlook 2012-13”.
According to the GSDP, Qatar will again post a “sizeable” fiscal surplus in 2012, despite large, planned increases in recurrent outlays on wages, salaries and pensions as well as greater capital spending. A surplus of 7.8% of nominal GDP is expected in 2012 based on an estimate of the price of the country’s hydrocarbon basket.
The fiscal surplus in 2013 is predicted to come down to 4.8% as hydrocarbon income stabilizes and spending continues growing, along with the economy and population.
The GSDP expects Qatar to see a robust growth in its real GDP (6.2%) in 2012
As emphasized in Qatar’s National Development Strategy 2011-2016, the challenge remains to broaden the revenue base and to shrink the non-hydrocarbon deficit. The GSDP expects Qatar to see a robust growth in its real GDP (6.2%) in 2012. Although hydrocarbon growth will slow, growth outside the sector – including downstream processing and petrochemical industries – will continue at a fast clip.
In 2013, the overall growth is expected to moderate to 4.5%. The non-hydrocarbon sector is seen maintaining momentum through to 2013, but oil and gas growth will taper off as yields from maturing oilfields resume their decline, after a pick up in 2012.
Further, with the start up of the Barzan Project (scheduled for 2014) and the completion of investments in enhanced and incremental recovery in older oil fields, upstream production will rally.
Forecast nominal GDP growth of 4.7% is unlikely to stray far from expected volume growth of 4.5%
Historically, the changes in hydrocarbon prices have had an important influence on the resources available to Qatar’s economy. This year, the average annual oil prices are forecast to advance from their levels in 2011, giving a modest boost to nominal GDP growth, which is projected at 11.2%. But with oil prices likely to stabilize or even drift down in 2013; forecast nominal GDP growth of 4.7% is unlikely to stray far from expected volume growth of 4.5%.
On construction, the GSDP said Qatar may well spend $39bn (10% of the GDP) this year and in 2013 on infrastructure and total project disbursements.
Between 2012 and 2019, Qatar has planned infrastructure investments totaling about $130bn
The construction sector is expected to benefit and record volume growth of about 10% in these two years, GSDP said. New project activity will make heavy demands on labor and require new workers, lifting Qatar’s population in the near term, but making the non-Qatari population more transient as many of the workers will probably leave when projects end.
“The knock-on effects of projects spending on income and demand in the rest of the economy will be dampened by large leakages in the form of imports of materials and capital goods as well as remittances of wage and other income,” GSDP said.