Manufacturing sector, particularly in petrochemicals, and the roll-out of infrastructure projects in the run-up to the 2022 World Cup, would continue to drive Qatar's economic diversification and growth of the non-oil sector, Global Investment House said.
Since 2011, Qatar has successfully completed its 20-year investment plan to commercialize its natural gas reserves, the third largest globally, with 25tn cubic meters or 13% of the world's total proven reserves. This has led Qatar's economy to almost double over the last four years to $192.3bn as of 2011.
Qatar's economy is expected to moderate to a steady rate of 5.2% in 2013 (6.6% in 2012), following a record double-digit growth in 2006-2011.
The non-oil and gas sector, which is estimated to expand 9.9% in 2012, is expected to drive growth in Qatar's economic expansion during 2012 and going forward, Global Investment House said.
Oil and gas sector was significant contributor to the overall GDP at 42.6% in 2012.
LNG production more than doubled in 2009-2011 to 74.8mn tons.
With an additional 3.9% increase expected in 2012, LNG production is expected to stabilize at 77mn tons till 2017.
Crude oil production, after a slight 0.5% increase expected in 2012, would continue to decline at CAGR of 5.7% to 559,000bpd in 2017.
Nevertheless, the significance of the oil and gas sector has been waning in recent times, as the government's efforts to diversify the economy away from its reliance on hydrocarbons are coming into effect. Share of the non-oil & gas sector in the overall economy increased to 57.4% in 2012 from 40.7% (2011).
According to GIH , Qatar plans to invest $200bn over the next 10 years as part of its preparation for the 2022 FIFA World Cup, and a significant part ($140bn) would be spent in the first five years in projects such as new airport, seaport, and a rail and metro system.
These projects are expected to be complemented by additional investments from Qatar petroleum ($50bn) and other public and private firms ($100bn). Furthermore, the Qatari government aims to increase spending on public administration, healthcare, and education as part of its new 2013-14 budget, including 21% higher capital spending and 16% higher current spending than in the previous budget.
Qatar reported another trade surplus during 2012, as exports rose 17% to $131.5bn, while imports increased at a slower rate of 14.3%. Trade surplus grew 17.8% in 2012 in addition to the 62.2% increase registered in 2011. Exports continued to be driven by LNG, which represents over 60% of the total exports.
The current account surplus increased 19.9% YoY to $61.3bn in 2012, led by high gains from trade surplus, which offset non-merchandise deficit. Similar to the trade surplus, the current account surplus is expected to decline to $57.1bn in 2013, as rising imports and non-merchandise outflows drag down surplus.
Endowed with the large surplus from oil and gas exports, Qatar has continued to acquire foreign assets. In addition, repatriation of proceeds by foreign corporations, following the completion of LNG infrastructure expansion, led foreign outflows.
Foreign outflows (net) were $1.5bn in 2012 due to a $1.8bn outflow, though Qatar received $324mn in foreign investment. Portfolio investments remained volatile, reflecting the general weakness in the financial markets.