Qatar is an emirate in the Middle East, occupying the Qatar Peninsula on the northeasterly coast of the Arabian Peninsula. Capital and largest city is Doha. It is bordered by Saudi Arabia (south); otherwise the Persian Gulf with the island of Bahrain and at the other side Iran surrounds the state.
Even the world’s fastest growing economy has not been able to escape the global economic crisis this year. GDP growth in Qatar is set to decelerate to seven to 10 per cent in 2009 from 14.3 per cent in 2008, according to the Economist Intelligence Unit (see latest update here).
It latest report on the oil and gas rich peninsula in the Persian Gulf points to an 80 per cent hike in gas production from 2009-10 as six new super-trains come on stream, supporting GDP growth at a time when other oil states are going to be hit by an expected 50 per cent fall in oil revenues.
But there is some good news coming in the form of lower inflation. Qatar has seen its cost of living, particularly accommodation, rocket with inflation of 15.1 per cent in 2008 the highest on record. At the end of the first quarter inflation was down to 13.2 per cent as the economy cooled.
The EIU also notes that Qatar has a solid accumulation of financial reserves and steady expected income from gas exports that will shield the tiny country from the global recession.
However, the current account surplus is set to fall to 2.5 per cent of GDP in 2009, the lowest in a decade. By 2010, all the same, this will balloon to 17.6 per cent thanks to a surge in LNG exports to 72 million tones.
There is also praise for the country’s economic diversification strategy from the EIU. It cites a series of major infrastructure projects, including the causeway to Bahrain that critically do not depend on finance raised in global markets.
Other policy shifts on the horizon are a cut in corporation tax from 35 to 10 per cent to encourage business start-ups, a streamlined licensing system and a single regulatory framework for the financial system.
It is therefore easy to conclude that Qatar has probably been the country in the world least affected by the global economic crisis, and will be the first to overcome its challenges.
qatar sea views