Qatar’s economic landscape is looking pretty strong, according to the International Monetary Fund (IMF). They’ve got a nice 4% average growth rate projected for the medium term. A big player in this growth story is Qatar’s North Field expansion, planned to give their liquefied natural gas (LNG) production a hefty boost. This expansion could entrench Qatar’s position as a global energy supplier while maintaining fiscal and external balances.
The IMF’s latest assessment suggests Qatar’s resilience is powered by cleverly crafted policies and, of course, that significant hydrocarbon wealth they’re sitting on. The plan is to beef up LNG output through the North Field, which is expected to not only support the economy but also lead to an improved fiscal standing.
There’s a focus on not just boosting the hydrocarbon export but diversifying into a private-sector-driven, knowledge-based economy. The Third National Development Strategy (NDS3) is part of this mission, aiming for a more sustainable and eco-friendly economic path.
A non-hydrocarbon growth of over 4% by 2025 is also on the cards, with the Purchasing Managers’ Index (PMI) reflecting positive indicators. This all sounds like good news for 2024 too, where a bounceback is expected with non-hydrocarbon sectors taking the lead.
Despite the tumble in hydrocarbon revenues, Qatar managed to keep a healthy current account surplus of over 17% of its GDP in 2024, a testament to the robust performance of its services sector. While the fiscal surplus did shrink a bit, there was a welcome improvement in the non-hydrocarbon primary balance.
Fiscal discipline is the name of the game for Qatar moving forward. The 2025 budget looks to follow closely in the footsteps of 2024, with gradual changes intended to keep the economy on a prudent path. The idea is to sustain twin current account and fiscal surpluses, which will be interesting to watch.
