Doha,April,06:Balanced growth: Qatar has invested huge amounts in the expansion of the LNG sector. Further, the surpluses generated from the increase in hydrocarbon production and high prices, are being invested in the non-hydrocarbon sectors such as manufacturing, construction and financial and banking services. Attention is also being paid in improving the standard of living of the citizens.
Benefits of the Arab Spring: Qatar faced none of the chaos and unrest that characterized its neighbours in the Arab Spring. While it responded politically to the unrest, its economic prospects did not suffer. Indeed, it benefitted economically from the Arab Spring’s effect on the international oil and gas prices, which enabled it to enhance its public revenue and support its expansion programs.
Overseas investments: Large overseas investments have raised Qatar’s status as a source of funding for the global economy. Examples include the £ 13 billion spent in the recent years on purchasing Chelsea Barracks, Harrods and the Olympic Village. Qatar is also the largest shareholder in Barclays Bank.
Well-capitalized banking sector: The Qatar Investment Authority (QIA) had input US$ 2.8 billion of capital into the banking system in three tranches between 2009 and 2011 to help the domestic banks during the global crisis. As a result, the capital adequacy ratio (CAR) of the banking sector increased to 20.6 percent by end 2011. A well-capitalized banking sector enables the industry to access credit at competitive rates, thus driving the economy. The sector also remains resilient in the event of a downturn.
Threat from Iran: Threat of Iran continuing its nuclear programme remains a strong threat to the stability of the Qatar. With the potential to trigger a Gulf conflict is something that GCC leaders must guard against. Also, bilateral relations between Qatar and Iran are likely to deteriorate if Qatar continues with its stance on the Syrian conflict.
Downside risks from the global economy: Although the overall outlook is favourable, the downside risks from the global economy continue due to the European crisis.
Construction Industry Highlights
The construction sector in Qatar is witnessing unprecedented expansion with diverse projects announced this year reflecting consistent and extensive growth. This boom covers almost all the sectors within construction including roads, ports, oil and gas infrastructure, education and social infrastructure as well as sports related infrastructure due to the hosting of the FIFA World Cup 2022. Future projects have been announced by the government and should be initiated by Qatar Rail, Qatar General Electricity and Water Corporation (Kahramaa), Public Works Authority (Ashghal) and the Qatar 2022 Supreme Committee.
The National Vision 2030 is aimed to set Qatar’s place as the region’s premium economy, with a core interest in developing the modern infrastructure sectors such as education, healthcare and tourism.
The Qatar Government has allocated 40 percent of its 2012-2016 budget to infrastructure projects alone.
The value of currently planned and announced construction projects in Qatar exceeds US$ 266 billion. Approximately 15% percent of all construction projects in the GCC region are concentrated in Qatar, whilst UAE and Saudi Arabia are continuing to lead the way.
Qatar has known and announced projects worth US$ 266.8 billion. Notably, the infrastructure sector leads the way with a total value of projects in pipeline valued at US$ 102.4 billion, buildings sector projects are estimated at US$ 82.0 billion, followed by oil and gas projects valued at US$ 61.2 billion.
Source:
Qatar Chronicle
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