The Economic Growth Of Qatar For 2019-2020
Qatar is a major exporter of gas, and Yasir’s gas business was thriving. But unfortunately, due to the diplomatic rift with the neighbouring nations, it saw economic growth of only 1.4% in 2018, lower than 1.6% in 2017.
However, Yasir was relieved when the Qatar Central Bank stated in its 2018 report that ‘despite the slow GDP growth than the previous, economic growth outlook is positive for 2019.’ The central bank also said that economic growth would accelerate remarkably over the following two years as there’s an expectation of continued strong exports and stable oil prices.
In 2018, the growth was estimated to have recovered by 2.1% because the activities have recovered from the diplomatic split between Qatar and some GCC neighbours. It is supposed that the economy will expand by 3% over the medium term. The reason behind it is the continuous investments being made for hosting the FIFA World Cup and because of a huge natural gas facility coming on-stream.
Most probably, 2019 will witness overall macroeconomic stability due to the favourable movements in oil prices globally, improvement in fiscal balance, and strong exports for businesses like Yasir’s.
The Qatar central bank has stated that between 2018 - 2020, the real GDP is most likely to grow at an average of 2.8% (referring to the data from the Planning and Statistics Authority).
Yasir’s overall outlook stays positive because the growth is expected to rise by 3.4% by 2021 due to the growth of the service sector because of the Football World Cup coming. There will also be a growth in the hydrocarbon sector because the Bazan natural gas facility will come in 2020, and by 2024 there will be the completion of the expansion of the North Field gas project. For attracting Foreign Exchange inflows in the banking system and re-establishing the spread v/s US policy, Qatar Central Bank has started raising interest rates.
Also, money spent in major projects will increase by 15%, and in 2019, the budget surplus is likely to fall to 4.35 billion riyals as compared to 15.1 billion riyals in 2018, said the bank.
Supported by recent tax reforms and the introduction of a VAT over the medium term, public finance is likely to remain in a small surplus. According to the central bank, foreign capital influences are returning, and banking liquidity has also improved remarkably.
Qatar has injected forty billion dollars into its banking system to improve liquidity in the months' post the boycott. Qatar’s economy has remarkably overcome all the hindrances caused by the diplomatic split with GCC neighbours.
Since the mid-2017, the Qatar economy has remained unaffected by the economic and diplomatic blockade imposed by neighbouring countries, led by the United Arab Emirates and Saudi Arabia. This has made Qatar one of the most favourable countries to start a company for businesses like Yasir.
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