Qatar's Economic Growth Accelerates to 3.7% in 2022
According to specialized economic reports, the Qatari economy returned to recording growth in 2021, as the gross domestic product grew by 1.5% thanks to the increase in consumer demand and the easing of the turmoil caused by the Covid-19 pandemic. Government support measures, including a $21 billion stimulus package, followed by the launch of a rapid vaccine program, and high energy prices contributed to a rapid recovery.
The growth pace is expected to accelerate to 3.7% in 2022 in light of the growth of the non-oil sector by 5.5% thanks to the imports of the travel, hospitality, logistics, and business activities related to the events of hosting the FIFA World Cup matches, as this global event is expected to attract about 1.5 million visitors from November to December.
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According to the report, the improvement in private sector activities was clearly reflected in the PMI reading for the month of April, which recorded its highest level ever at 63.6 points as a result of the improvement in the conditions of the construction sector and the increasing backlog.
The high growth in domestic credit, rising by 11% in 2021, indicates the recovery of the private sector, while some signs of recovery appeared in the real estate market activity after several years of decline, as the real estate price index issued by the Qatar Central Bank rose by 2.6%, based on Annually, March 2022
This growth in the non-oil economy sector is supported by the government's ambitious "Qatar National Vision 2030" Program, which includes huge investments in infrastructure for a number of strategic sectors such as manufacturing, finance, and tourism.
In a related context, the rise in energy prices is expected to boost the budget surplus to reach 12.8% of GDP this year, compared to 0.2% of GDP in 2021. The Ministry of Finance had announced a moderately expansionary budget for the 2022 fiscal year. / 2023 to increase public spending by 5% on capital and current expenditures compared to the budget of the last fiscal year, in order to achieve a balance between more financial control measures in the future and support economic growth and development goals
The realized revenues are likely to exceed the budget estimates, which are based on a conservative oil price of $55 a barrel. The economic recovery also contributes to opening the way for the government to get rid of the remaining measures to boost the economy during the pandemic period, including postponing loan installments. In addition, a value-added tax may be introduced in 2023, which will contribute to a further boost to public revenues, although the timeline is still uncertain.
It is worth noting that the State of Qatar is in the process of signing several agreements to export liquefied gas to Europe, following the visit of His Highness the Emir to Germany, as part of a long-term plan for Qatar to replace Russia, as the first exporter of gas to the European continent.