Qatar Country Risk Report

Providing comprehensive data and in-depth analysis of political, financial and economic risk.

Report includes: BMI's Core Views, 10-year Forecasts, BMI's Economic Risk Index, Political Stability and Risk Index, Long-term Political Outlook, Operational Risk Index, SWOT Analysis and Structural Economic Sections

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  • Understand and measure the political, business environment and operational risks to your company
  • Gain insight on emerging trends that could support, strengthen or disrupt your activities in the market
  • Benefit from 10-year macroeconomic forecasts and insight into the structural characteristics of the economy
  • Get the long-term political outlook and explore possible scenarios for change
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Qatar Country Risk Report
Product Price
$1,195.00

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 performance of the Qatari economy will be more mixed than in recent years, amidst the intertwined pressures of the global energy slump and tightening domestic liquidity. We forecast real economic growth of 3.1% this year and 3.6% in 2017, driven mainly by strong growth in investments as preparations for the FIFA 2022 World Cup continue.

  • Lower hydrocarbons prices do not present a significant threat to Qatar's fiscal sustainability. Nevertheless, the government will seek to tighten control over public spending and rationalise Qatar's vast pipeline of infrastructure projects - a trend that will be positive for the economy over the longer run.

  • We expect the Qatari Central Bank to maintain its policy lending rate on hold at 4.50% for the coming months, in a continued divergence from the Fed's hiking cycle. Deepening liquidity problems mean that more active steps to ease the strain on the domestic banking system are likely, including a cut in the repo rate and a reduction in the required reserve ratio.

  • Qatar's decision to send 1,000 ground troops to Yemen - nearly 10% of its armed forces - marks a decisive milestone in the country's foreign policy. The move aligns Qatar more closely with its Gulf neighbours, but carries domestic risks and comes with little benefit.

Key Risks

  • 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 USD335bn 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 initiation in May 2015 of Swiss and US investigations into alleged corruption in world's footballing governing body FIFA is once again fuelling uncertainty over Qatar's hosting of the 2022 World Cup. While our baseline scenario assumes that the tournament will go ahead in Qatar as planned, the loss of the rights to the event would hit growth on several fronts, and deal a significant blow to the country's global soft power ambitions. That said, such a scenario would hardly be the end of the road for Qatar's impressive growth story.

Macroeconomic Forecasts (Qatar 2014-2017)
Indicator 2014 2015e 2016f 2017f
National Sources/BMI
Real GDP growth, % y-o-y 6.2 4.0 3.1 3.6
Nominal GDP, USDbn 211.7 152.9 150.9 181.0
Consumer price inflation, % y-o-y, eop 2.7 2.7 3.0 3.0
Exchange rate QAR/USD, eop 3.64 3.64 3.64 3.64
Budget balance, % of GDP 16.0 1.7 -4.6 -2.0
Current account balance, % of GDP 23.5 9.0 -1.9 1.5
Executive Summary
5
Core Views
5
Key Risks
5
Chapter 1: Economic Outlook
7
SWOT Analysis
7
BMI Economic Risk Index
7
Economic Growth Outlook
8
Learning To Live With Slower Growth
8
TABLE: SELECTED INFRASTRUCTURE PROJECTS IN QATAR
8
GDP By Expenditure Outlook
10
TABLE: GDP GROWTH FORECASTS
10
TABLE: GOVERNMENT CONSUMPTION FORECASTS
10
TABLE: PRIVATE CONSUMPTION FORECASTS
11
TABLE: FIXED INVESTMENT FORECASTS
11
TABLE: NET EXPORTS FORECASTS
11
Fiscal Policy And Public Debt Outlook
12
Fiscal Deficit Temporary, FIFA World Cup Investments Not At Risk
12
External Trade And Investment Outlook
13
Gargantuan Surpluses Are Gone, But No Crisis On The Horizon
13
Monetary Policy
14
Growth, Liquidity Concerns Make For Further Rate Divergence
14
Monetary Policy Framework
15
Chapter 2: 10-Year Forecast
17
The Qatari Economy To 2025
17
Solid Long-Term Growth Prospects
17
TABLE: LONG-TERM MACROECONOMIC FORECASTS
17
Chapter 3: Political Outlook
19
SWOT Analysis
19
BMI Political Risk Index
19
Domestic Politics
20
More International Criticism To Come, But World Cup Not At Risk
20
TABLE: POLITICAL OVERVIEW
20
TABLE: SELECTED INFRASTRUCTURE PROJECTS
21
TABLE: MIGRANT LABOUR FORCE RELATED PROJECTS
21
Long-Term Political Outlook
22
Limited Challenges For The Coming Decade
22
Chapter 4: Operational Risk
25
SWOT Analysis
25
Operational Risk Index
25
Operational Risk
26
TABLE: OPERATIONAL RISK
26
Economic Openness
27
TABLE: TOP FIVE IMPORT PARTNERS & PRODUCT IMPORTS, 2010-2014, USDMN
27
TABLE: FREE TRADE AGREEMENTS
28
TABLE: FREE TRADE ZONES AND INVESTMENT INCENTIVES
29
Availability Of Labour
31
TABLE: MIDDLE EAST AND NORTH AFRICA - AVAILABILITY OF LABOUR RISK
32
TABLE: TOP 10 SOURCE COUNTRIES FOR MIGRANT WORKERS ('000), 2013
33
TABLE: LABOUR FORCE EMPLOYMENT BY SECTOR ('000), 2007-2011
34
Chapter 5: BMI Global Macro Outlook
37
Global Macro Outlook
37
Summer Of Risk
37
TABLE: GLOBAL ASSUMPTIONS
37
TABLE: DEVELOPED STATES, REAL GDP GROWTH, %
38
TABLE: EMERGING MARKETS, REAL GDP GROWTH, %
39
TABLE: MACROECONOMIC DATA & FORECASTS
41

Assess your risk exposure in Qatar with our 100% independent forecasts assessing the pace and stability of this key market. Backed by trusted data from BMI Research's 52 million data point economic forecast model, this report will allow you to measure political, economic, business environment and operational risks in Qatar with confidence.

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