Business Monitor International


Qatar Business Forecast Report

Published 16 December 2014 | Quarterly

  • 55 pages
  • Instant access to your report online and PDF format through your account library
  • Includes 3 free updated quarterly reports
 
$1,195.00
Qatar Business Forecast Report

Core Views

  • Qatar's short-term political risk profile remains among the most stable in the region. Despite enjoying little in the way of democratic freedom, Qataris benefit from massive hydrocarbon wealth which is spread generously across the country's native population and enjoy the highest per capita GDP in the world. A small population - and one without much inclination to protest against the government - will keep the country insulated from large-scale public unrest in the immediate term.

  • The Qatari economy will continue to expand at a rapid pace over the next few years, supported by accommodative fiscal policy - notably infrastructure spending - and strong population increases. The non-hydrocarbons economy will propel growth, with construction activity and the services sector set to remain the dominant performers.

  • We forecast real headline growth of 6.6% and 6.1% in 2015 and 2016 respectively. Lower hydrocarbon prices present no immediate threat to Qatar's infrastructure investments and economic performance. The new Barzan gas development, which is scheduled to come on-stream in 2015, will shore up growth in the hydrocarbon sector throughout the coming quarters.

Key Risks To Outlook

  • Given the economy's heavy reliance on the hydrocarbon sector, a pronounced global economic downturn - if it were to translate into a sustained drop-off in demand for oil and gas - could impact negatively on our forecasts for Qatar's external account position, budget and growth outlook. That said, we highlight that the country's US$115bn sovereign wealth fund - as well as its continuing ability to tap international debt markets - provides the economy with significant bulwarks against these risks.

  • The construction sector remains exposed to the potential for delays and cost overruns, a factor that is increasing and unlikely to improve over the medium term.

  • The confirmation that Qatar will host the FIFA 2022 World Cup removes a key downside risk to our economic and...

Table of Contents

Executive Summary
5
Core Views
5
Key Risks To Outlook
5
Chapter 1: Political Outlook
7
SWOT Analysis
7
BMI Political Risk Index
7
Foreign Policy
8
End Of GCC Dispute Eases Qatar's Isolation
8
The reconciliation agreement reached between Qatar and the rest of the Gulf Cooperation Council (GCC) allows the regional bloc to
The reconciliation agreement reached between Qatar and the rest of the Gulf Cooperation Council (GCC) allows the regional bloc to
present a more united front at a time of rising external challenges, and eases Doha's diplomatic isolation
While Qatar will remain under
GCC pressure to adopt a less assertive foreign policy, we stress that the country's international engagement is far from over
TABLE: POLITICAL OVERVIEW
8
TABLE: TIMELINE OF QATAR - GCC DISPUTE
9
Long-Term Political Outlook
10
Limited Challenges For The Coming Decade
10
We find it hard to argue that political instability could become a core scenario in Qatar
Nevertheless, with the government playing
the role of conflict mediator in one of the hottest international conflict flashpoints in the world, in addition to having a growing young
the role of conflict mediator in one of the hottest international conflict flashpoints in the world, in addition to having a growing young
population and increasing number of expatriates, Qatar will not be immune to external and internal shocks in the long run
Chapter 2: Economic Outlook
13
SWOT Analysis
13
BMI Economic Risk Index
13
Economic Activity
14
Economy To Power On As Investment Remains Unaltered
14
The Qatari economy will continue to expand at a rapid pace over the coming years on the back of the government's ambitious public
The Qatari economy will continue to expand at a rapid pace over the coming years on the back of the government's ambitious public
investment programme, and we forecast real headline growth of 6
Lower hydrocarbon
prices present no immediate threat to Qatar's infrastructure investments and economic performance
TABLE: Economic Activity
14
TABLE: ONGOING AND UPCOMING MAJOR PROJECTS
15
Economic Policy
17
World Cup Confirmation Does Not End Image Problem
17
The confirmation that Qatar will host the FIFA 2022 World Cup removes a key downside risk to our economic and construction growth
The confirmation that Qatar will host the FIFA 2022 World Cup removes a key downside risk to our economic and construction growth
forecasts
However, Qatar's international image continues to decline, a factor that will complicate the government's efforts to turn the
country into a knowledge-based and high value-added economy
Economic Policy II
19
Qatar - Asia Ties: Not Just About Hydrocarbons Anymore
19
Investment and financial ties between Qatar and Asian countries are growing rapidly, in line with rising trade interdependence
This
trend will continue over the rest of this decade, as Qatar pursues more investment opportunities outside of Europe and gains a foothold
trend will continue over the rest of this decade, as Qatar pursues more investment opportunities outside of Europe and gains a foothold
in the yuan trade
Banking Sector
20
Overseas Expansion To Accelerate
20
Qatari banks will continue to expand overseas over the coming decade, encouraged by strong capital positions and the elevated degree
Qatari banks will continue to expand overseas over the coming decade, encouraged by strong capital positions and the elevated degree
of competition characterising their domestic market
Despite a recent moderation in domestic lending activity, we retain our positive
view of Qatar's commercial banking sector
0% in
2015
TABLE: KEY FIGURES - AS OF END-2013
20
Business Monitor International Ltd www
com 3
Contents
Contents
Chapter 3: 10-Year Forecast
23
The Qatari Economy To 2023
23
Solid Long-Term Growth Prospects
23
The outlook for the Qatari economy over the next 10 years is positive, particularly given the positive outlook on the hydrocarbon sector
The outlook for the Qatari economy over the next 10 years is positive, particularly given the positive outlook on the hydrocarbon sector
and our view that the country will continue recording substantial current account surpluses
Political risk is likely to remain low, as we do
not see the al-Thani family losing its grip on power
TABLE: Long-Term Macroeconomic Forecasts
23
Chapter 4: Operational Risk
25
SWOT Analysis
25
Operational Risk Index
25
Operational Risk
26
TABLE: Operational Risk
26
Transport Network
27
TABLE: Midle East and North Africa Transport Networ k Ris ks
27
Economic Openness
30
TABLE: MENA - Economic Openness
30
TABLE: Top 5 Trade Partners Product Imports (USDmn ), 2007-2012
31
TABLE: Top 5 Products Exported (USDmn ), 2010-2012
32
Chapter 5: Key Sectors
35
Infrastructure
35
TABLE: Construction & Infrastructure Industry Data
36
TABLE: Construction & Infrastructure Industry Data
37
Oil & Gas
39
TABLE: Oil Production
39
tABLE: Oil Production
39
TABLE: Gas Production
40
TABLE: Gas Production
40
Other Key Sectors
43
Table: Food and Drink Sector Key Indicators
43
Table: Telecoms Sector Key Indicators
43
Table : Pharma Sector Key Indicators
44
Table: Autos Sector Key Indicators
44
Table : Freight Key Indicators
44
Chapter 6: BMI Global Assumptions
45
Global Outlook
45
Warning Signs Growing
45
Table: Global Assumptions
45
Table : Developed States , Real GDP Growt H, %
46
Table : BMI VERSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORECASTS, %
46
Table : Emerging Markets , Real GDP Growth , %
47

The Qatar Business Forecast Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Qatar and is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market.

An influential new analysis of Qatar's economic, political and financial prospects through end-2018, just published by award-winning forecasters, Business Monitor International (BMI).

Key Uses

  • Forecast the pace and stability of Qatar's economic and industry growth through end-2018.
  • Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
  • Assess the critical shortcomings of the business environment that pose hidden barriers and costs to corporate profitability.
  • Contextualise Qatar's country risks against regional peers using BMI's country comparative Risk Rankings system.
  • Evaluate external threats to doing business in Qatar, including currency volatility, the commodity price boom and protectionist policies.

The Qatar Business Forecast Report by Business Monitor International (BMI) includes four major sections: Economic Outlook, Political Outlook, Business Environment and Key Sector Outlook.

Economic Outlook:

How will the Qatar economic policy-making and performance impact on corporate profitability over 2014-2018?

BMI provides our fully independent 5-year forecasts for Qatar through end-2018 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The Qatar Business Forecast Report features BMI's forecasts with supporting analysis for 2014 through to end-2018, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

  • Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
  • BMI's comprehensive Risk Rankings system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

  • Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
  • Balance of Payments - trade and investment, current and capital account.
  • Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
  • Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
  • Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
  • Foreign Direct Investment - approvals, inflows and climate.
  • External Debt - debt profile (short and long-term plus public and private sector exposure).
  • Global Assumptions - forecasts for each year to end-2018 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.

Key Benefits

  • Rely upon BMI's 100% independent forecast scenarios for Qatar and underlying assumptions - we take no advertising and are privately-owned.
  • Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on Qatar, sourced and fully maintained by BMI from an extensive network of private sector, government and multilateral contacts.
  • Gain key insights into the current and future direction of government economic policy, which could significantly affect your company's business prospects, from BMI's team of analysts and economists.

Political Outlook:

What are the political risks to doing business in Qatar over the next 5-years?

BMI's Qatar country Risk Rankings evaluate the short- and medium-term threats to political stability.

Political Outlook Contents

  • SWOT Analysis for the Qatar Market - Political Strengths, Weaknesses, Opportunities and Threats facing Qatar.
  • Political Stability and Risk Assessment - BMI's Risk Rankings assess explicit short- and long-term risks to political stability; latest ankings, rankings and trends for Qatar's risk are compared with regional and global averages.
  • Current Administration and Policy-making BMI assesses the threats to the continuity of economic policy, and likely changes to the business operating environment.

Key Benefits

  • Benchmark Qatar's risk profile against its neighbours, the global and regional average, allowing easy comparison of risks between key business markets.
  • Identify, evaluate and anticipate political and security risks to the business environment, and to your company's current operations and future plans.
  • Gain valuable insights into government and policy-making, through BMI's specialist team of analysts and economists, and their network of private and public sector sources.

Business Environment

Business Environment Risk Rankings with SWOT Analysis - Business Environment Risk Rankings for Qatar, benchmarked against rankings for regional neighbours.

Country Competitiveness - Competitiveness of Qatar's business operating environment in supporting corporate growth and profitability, compared with regional neighbours.

Business Environment Contents

  • Domestic Environment - Transparency, cronyism and corruption; labour market flexibility; corporate tax burden; interest rate levels; sophistication of banking sector and stock market; levels of business confidence; infrastructure and IT.
  • Foreign Direct Investment - Analysis of foreign investment regime; foreign ownership laws; attractiveness of business environment to foreign investors.
  • Foreign Trade - Analysis of trading environment, government trade policy, liberalisation measures, tariffs and membership of trade areas.

Key Benefits

  • Assess your company's evolving exposure to country specific operational and business risks, using BMI's in-depth analysis of the legal and regulatory business environment.
  • Understand your market's comparative strengths and weaknesses in the key areas of commercial infrastructure and business institutions, using BMI's proprietary global Business Environment Risk Rankings.

Key Sector Outlook

Which industry sectors in Qatar will grow fastest, and where are the major investment opportunities in the market?

BMI's identifies investment opportunities in Qatar's high growth industries including automotives, defence & security, food & drink, freight transport, infrastructure, oil & gas, pharmaceuticals & healthcare and telecommunications & IT.

Key Areas Covered:

  • Market Overview - Size and value of each industry with developments over 2009-2013, covering major industry key performance indicators (KPIs) that have impacted company performance.
  • 5-year Industry Forecasts - Forecasts for each year over 2014-2018, using BMI's proprietary industry modeling technique, which incorporates all key domestic and international indicators - including economic growth, interest rates, exchange rate outlook, commodity prices and demographic trends - to provide fully integrated forecasts across, and within, each industry.
  • Demand- and Supply-Side Data/Forecasts - BMI's industry data covers both the output of each industry and the domestic demand, offering clear analysis of anticipated import/export trends, as well as capacity growth within each industry.

Key Benefits

  • Target strategic opportunities in high growth industries, which are benefiting from global mega trends, and thus offer strong investment and growth opportunities.
  • Compare the growth path of different industries to identify which are best placed to benefit from domestic and international economic prospects, and which have historically suffered from volatile growth trends - a key indicator of future risks.

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Testimonials

The sections that I find most interesting and useful are the macroeconomic data and forecasts for the country, top export destinations and economic activity. The indicators/analysis of these areas helps us orient our thinking, our assumptions and, consequently, our decisions in the commercial area.

Country Manager, DHL Express