Despite a “normalised” economy, the International Monetary Fund’s forecast for Qatar is positive given support from liquefied natural gas production.
The International Monetary Fund (IMF) has told Gulf Business on Tuesday that it has found the Qatari economy to have “normalised” following an economic upsurge during the Qatar 2022 World Cup (WC).
Qatar’s output is expected to “expand by about 1¾ percent per annum during 2023–25 with the non-hydrocarbon sector growing at 2¾ percent driven by domestic demand”, Ran Bi, the IMF’s Mission Chief to Qatar also told Gulf Business.
Bi also said that last year’s tournament had yielded Qatar a “robust” tourism sector, “boosted by the global visibility brought by the 2022 FIFA World Cup”.
The IMF said that their findings following an Article IV Mission to Qatar indicate a “favourable medium-term outlook, liquefied natural gas(LNG) production expansion and intensifying reform efforts.”
On Qatar’s medium-term growth, Bi said that Qatar’s Third National Development Strategy, which is based on National Vision 2030 (QNV 2030), the Gulf state can expect a 5 percent year-on-year growth rate.
As per the government communique, the QNV 2030 manifesto promises to charter “economic justice and progress for all” in Qatar, wherein “the private sector will play a prominent role” in the local economy.
In an earlier survey of the nation’s economy conducted by PricewaterhouseCoopers (PwC) International, QNV’s clarity has recently been seen to skyrocket the local economy in only a matter of a few years into “maturity.”
Bi also praised the Qatar Central Bank for maintaining price and financial stability, which has “moderated” national inflation. She did, however, warn that banks would have to remain “diligent.” To this end, Bi advised for greater reforms in Qatar to “further deepen domestic financial markets”.
‘Normalisation’ or ‘slowdown’?
The image painted by the IMF and PwC comes as a stark contrast to an August 18 Doha News report investigating the rise in businesses being shuttered following the 2022 WC.
Speaking anonymously to Doha News, one local entrepreneur said: “In Qatar we are facing an economic slowdown due to hosting the World Cup. This is very common in the economy with several nations that hosted either the World Cup or the Olympics.”
The Doha News investigation found high rents, operational costs and an inundation of similar business ideas in the marketplace has forced many into walking away from their unsustainable entrepreneurial dreams.
As early as February of this year, just twomonths following the end of Qatar’s monumental tournament, a popular anime-themed cafe, called Anime Cafe, which was popular among the genre’s fans, was forced to discontinue trading.
Amid the news breaking of the cafe’s closure, Snoonu CEO Hamad Mubark Al Hajri said in a post on X on February 19 that he was “shocked” that Anime Cafe, which once served as a creative outlet for his children, was no more.
“Are we in need of a committee or the help of experts to know the cause of our economic problems?” Al Hajiri also asked in the post.
To this end, the IMF’s Bi says Qatar is at an “important juncture.” In her estimation, Qatar’s economic success will be determined by the extent to which the state keeps up to date with digitisation.
