For the first time in a decade, the amount of money taken home by government workers in Qatar has declined after lower oil prices eroded the country’s finances.
Preliminary data released this week by the Ministry of Development Planning and Statistics (MDPS) shows spending on wages and salaries fell 2.7 percent in 2014-15 compared to the previous fiscal year.
This doesn’t necessarily mean that employees took a pay cut, as the decline could have been caused by a reduced headcount within government departments.
But the numbers mark a significant shift from previous years, during which compensation was typically increased for public servants, including in 2011 when salaries were raised an eye-catching 60 percent for nationals.
The drop in spending comes as senior politicians in Qatar – including the Emir – have stressed the need to control spending.
However, spending on administrative costs and grants continued to surpass the budgeted amounts, MDPS reported.
Meanwhile, lower oil prices appear to be hitting Qatar harder than expected, with government economists revising their growth forecasts downwards and projecting the country will start running deficits next year.
However, the outlook remains bright for many business sectors as the economy diversifies away from oil and gas.
Lower-than-expected growth
According to its semi-annual economic outlook, MDSP said that it expects Qatar’s economy to grow by 7.3 percent this year. While that’s still robust by global standards and 1.2 percentage points higher than 2014, the projection is down from a forecast of 7.7 percent published in December.
Lower oil prices – which can also act as a drag on natural gas prices – are causing energy companies in Qatar and around the world to cut costs.
That’s led to reports of significant layoffs and hiring freezes at some of the oil and gas firms here.
This week, MDPS hinted that more cuts may be in store, saying it expects additional “effective cost reductions” within the industry.
With hydrocarbon revenues making up more than half of Qatar’s government revenues, falling oil prices have caused the amount of money brought in to fall by 15.8 percent over the previous fiscal year.
However, MDPS cautioned that this figure is preliminary and that there have been delays in previous years in tallying up oil and gas revenues.
The ministry said this means that the government is expected to run its first fiscal deficit in 15 years in 2016. While MDPS did not put a dollar figure on its projection, others have suggested it could be around US$3.91 billion.
The deficit will likely put pressure on bureaucrats to cut costs, but this could prove tricky given ongoing preparations for the 2022 World Cup and infrastructure development. In its report, MDPS said:
“Oil prices, which are forecast to be well below levels of recent years, are expected to squeeze revenues (at a time when) capital spending programs will move ahead and current spending commitments will be difficult to trim.”
Outside the energy and government sectors, the ministry’s report predicted that the pain caused by lower oil prices would not be felt across the wider economy.
The rush to complete countless real estate, transportation and infrastructure projects means the construction sector is expected to lead Qatar’s economic growth this year.
Despite reports of key development projects being postponed, senior ministers have publicly insisted that all government spending initiatives are going ahead as planned.
Qatar will launch its all proposed projects as intended, said Finance Minister Ali Sherif Al Emadi, according to The Peninsula. No projects will be delayed or deferred, he added.
Transitioning economy
This is good news for both contractors and businesses that have benefited from Qatar’s construction boom. That includes banks, which have done brisk business extending credit to contractors working on large infrastructure projects, as well as insurance and trucking companies.
The ministry expects that rapid boom to start tapering off next year and in 2017 as contractors focus on completing existing jobs such as the Doha Metro and Msheireb, rather than breaking ground on new projects.
Expansion of the broader service sector – which includes financial, real estate, transport and communication businesses, among others – is also expected to be curtailed by relatively lower population growth.
But other areas are expected to pick up the slack. That includes hospitality businesses, which are benefiting from more conferences being held in and around Doha as well as the increasing number of tourists visiting Qatar, MDPS said.
Taken together, both the construction and service sectors – which together make up about 60 percent of Qatar’s economy – will keep growing, but at a slower pace (see sidebar).
While oil and gas production is predicted to plateau in the coming years, the manufacturing sector is forecast to grow thanks to a new refinery – Laffan 2 – that’s expected to start operating next year and produce jet fuel, among other products.
Thoughts?
that was expected , thou i thought it would be much more worse
When the oil price drops 50% of course that is going to hit anyone’s finances hard when 90% of your economy if O&G related. (LNG contracts are typically tied to the oil price)
This is why we have seen huge layoffs in the O&G sector and a free or slow down in recruitment in other areas that are not WC related directly. (everything is funded by the government directly or indirectly so if their revenues are hit, it will trickle down).
I actually think this is a good thing for Qatar to look at the way the money in spent in the country, the last 10 years Qatar has been spending like a drunken sailor with even less accountability. Too much money has been wasted, including on some highly paid useless expats and some pie in the sky projects. Hopefully this ushers in a more sober financial strategy for the next decade.
The best thing that can happen to Qatar and Qataris is $30 oil. It will ground everyone and allow us to refocus our priorities on what’s important…
like for example closing the 9 Universities that gave the country less than a thousand graduate .
half whisc are not even QATARIS
which*
I seem to remember reading that in the first VCU graduating class of 30 students, only 4 were Qatari. Is that correct, or am I mis-remembering?
i have no idea about the exact numbers , but for sure they are very low considering that 9 UNI only have less than a thousand graduate. QU had more than double that number & graduate form international UNI outside of Qatar almost triple that number .
QU is a much larger university and costs a LOT more. The 9 ‘universities’ are small branch campuses, not fully-fledged universities, and they weren’t designed to have large intakes. You have to look at the education cost per student to make a realistic comparison. Texas has graduated 600 engineers, and most of its students are Qatari according to press releases.
Besides, Qatar University has virtually no respect internationally. If students want to stay in Qatar and have a degree that is recognized globally, then Education City campuses are the only option.
Agreed, a QU degree, rightly or wrongly, is hardly worth the paper it is written on. This may change if they get their accreditation straightened out, but that project seems to have stalled.
Cornell has graduated around 24 Qataris total including first graduating class in ’08-’15.
It must be more than that. Haven’t there been about 200 students graduate from WCMCQ since 2008?
If there were 200 ‘graduates’ that would surprise me. I think at most, WCMCQ accepts about 25-40 students a year (and certainly not all complete the 2 years). And to clarify: it offers a 2-year intensive pre-med program. The students finish that and hope to do well on their MCATs and gain entrance to a reputable med school afterwards, but they do not receive or earn a university diploma or certificate from WCMC. They simply have completed 2 years of university classes. That’s it. If they want, they can transfer to CMUQ and finish another 2 years of university to get a 4 year BS degree — but this joint program between the two schools is a fairly recent development (less than 5 years). In the early days, those who didn’t get into med school were just out of luck.
Not true. Most Qataris do 1 or 2 years of Foundation (Like ABP to get english/math/science up to par) then everyone 2 yrs intensive premed then 4 yrs med school. There have been around 200 graduating doctors but most are not Qatari. As I said previously around 24-25 total. If they drop out of med school or don’t make it to med they can transfer to CMUQ and that’s been in place 2 yrs now.
Around that many graduates but vast majority of total students are not Qatari. Around 14% of give or take 275 total students. Most come from Pakistan, India, Egypt, etc.
By 4th year medicine the Q attrition rate is very high. This year was the most Qs ever. 4.
VCU has had 538 graduates so far, with 326 of them Qatari
You can also add:
– closing Qatar Museums
– closing Sidra or limiting its budget and scope of work
– cutting the budget for hosting international conferences and sports events by 95%
– and most importantly, cancelling the 2022 world cup
That would save Qatar a two-year budget at the current expenditure rate 🙂
Qatar museums yes,limiting sidra yes , hosting worthless conferences yes.
world cup NO, we have an obligation we have to meet .
In that case there will be savings but not that huge. I think the WC projects are by far the most expensive and resource-intensive
still an obligation that need to be fulfilled , another crazy way to cut the costs. turn Education city to fans housing city ,it would so cool .at least the most buildings are there / modify them .LOL
So destroy education facilities, (what good is education anyways, right) to support a one time event? They could however, decrease the spending on them. Some of the professor’s are paid quite quite high….
Sounds logical….
not destroy, reuse them for a better thing, you dont really think its a good investement for qatar/qataris
It is a good investment, it’s an investment in education that brings Qatar closer to it’s goal of becoming a knowledge based economy.
لا تتفلسف بأسم القطريين لو سمحت
You’re doing the same with your username
I get your point, but to do you need to waste millions building that new mosque at the EC to become a knowledge-based economy? Honestly all this waste is not justified, and a lot of Education City and QF projects in general are useless. World-class universities in Qatar? Yes that is a great idea! Wasting billions of dollars every year on those universities to end up with few hundreds of graduates every year? There is something wrong here that needs to be addressed asap or else the whole Education City project becomes a burden rather than a benefit to the country.
sorry you either live in imaginary land or just say things you don’t even know what it means , you cannot say education city is a good investment, when 9 university combined give less graduates than one , its been 10 yrs almost when will they have achieved what so called goal in QATAR , in 20 more years. unless you give me a good answer (numbers/achievements,..) els your saying its a good investment don’t mean a thing to QATAR
Despite what people say, these universities do not just accept anyone. You must have a high level of speaking, writing and comprehending the English language. As well, other fields of study are expected to be up to a certain level. Unfortunately, many government schools do not have strong educational systems.Hence, this is why at the moment there are not many attending the universities.
Qatar University is more lenient in its acceptance and hence why there are more Qataris there. The same can be said with CNA.
Mohammed bin Hamad bin Khalifa Al Thani attended Georgetown SFSQ (as well as quite a few other members of the royal family) and he has done quite a bit in terms of achieving.
sorry , your not making any sense , according to you ,education should be available to every one ,but saying (these universities don’t just accept any one) , unless you have a high level of ENGLISH? then what the use of opening 9 universities in QATAR (AN ARABIC COUNTRY) while the average Qatari citizen ( giving an example of royal family member is BAD ONE) cannot have access it. do you realize what are saying ?
Because I hope that Qataris become more competitive and self-challenging.
Education should be available for everyone (which it is) but that does not mean to be so lenient just to give it to people.
And yes, Qatar is an Arabic speaking country. But, we hope to work on a global scale and that requires the English language. The average Qatari can have access to these facilities, there is nothing stopping them from having the capabilities to do so. Qatar even provides the Academic Bridge Program to try and improve those that wish to join them.
You asked to see an achievement so I simply stated one. I think he is an enthusiastic, innovative and bright fellow that has a lot going for him. There are others of course. Texas A&M has produced several Qatari graduates that are now in key positions in the Oil&Gas sector.
You want to see results immediately. All good things in life take time, commitment and patience.
you said it , on a GLOBAL scale , ppl learn other languages to communicate with ppl from other
countries, not to go to schools in their own countries , TELL ME WHERE IN THE US , CANADA, GERMANY , FRANCE where they FUND BY BILLIONS international private schools/colleges/UNIVERSITIES that wont reconsider using their own language as the official language of studying, and the majority of its students are not its citizen .& saying that public school isn’t very good to give its student the PROPER ENGLISH LEVEL TO ATTEND thoes universities. public school should give the basics for the future , if it to be more specific with its course , that’s when they are to be consider private one. (AGAIN THE ROYAL FAMILY MEMBER DOES NOT CONSIDER A GOOD EXAMPLE, HH SPECKS French , that means his been to private school, because most public school don’t offer it ) also you don’t compare the uprising of member of the royal family and an average person in any country around the world .
🙂 relax, it is just a discussion.
Putting caps does not make your comments any more valid.
As this does not seem to be going anywhere I’ll leave it as is.
im telling it was a vision , & will end up being a VISION if the results dont match
Perhaps you are right. Perhaps not.
We’ll see in time. Anyways, if we do not talk again anytime soon…I hope you have a happy Ramadan 😀 !!!
U2
I do think investing in education is important. To get rid of other education facilities and just solely have QU does not seem beneficial. Especially when these facilities offer a means to teach a more diverse outlook.I do not believe at all QU would teach some of the courses that were taught in them due to the content.
However, I also agree that the amount of money put into them is ridiculous.
let me put it this way, we have a budget cut , we only have 100 MILLION DOLLAR to spend on education.would you spend it on QU that gives you 1300+ graduate (which lets say 60% are Qatari) ) OR on NINE universities that didn’t even gave you 1000 graduate. (AT THE END OF THE DAY , YOU MUST HAVE THE INTEREST OF THE STATE OF QATAR IN MIND )
I do have the interest of the state in mind 🙂 Cultural growth and education are an intricate part of improving a state.
There’s many things that could be done to save money. Like…the World Cup.
Or actually making proper roads that do not need to be destroyed or reworked a year later (lots of money has been spent on failed road work). Etc, etc, etc.
As I have said. They can cut the cost of the universities but no need to close them.
We seem to have differing opinions on this subject. So lets leave it at that sir. Have a good day inshallah.
we sure do , all im asking for is to see results . while you are still talking about a vision ,
you too have a great day inshallah
I agree with you but there is something that you need to remember. The purpose of further education in its primary form is to prepare the student for employment. If QU is producing 10.000 graduates but employers in Qatar and around the world do not recognise the qualifications as being worth anything then the uni has lost its purpose. A college must retain its credibility but if they make light of the education just to produce graduates then they are just wasting money. People do not get into other colleges as if they did they would fail the course. This is a little like the local population asking the ACCA to make the papers easier so that they could pass. The root cause of this is what needs to be addressed and that is the basic primary and secondary educational system.
i disagree totally , if nine universities cannot give the market higher numbers of graduates ( & they will never do ) & cover the coast of buildings & operating then you cannot say it worth having them here . im not discussing education here , we are talking about budgets , you cannot have have something that is coasting me billions & the output is fractions of that .
Spending on education will inevitably decline, as it is calculated as being about 2.8% of GDP. As GDP falls, education spending will also fall.
the cost of running it wont , especially when the government dont TAX the universities , or charge them for any utility ( electricity, water, ..), still it wont cover what been spent on them.
And it never will is the thing. There can’t be a penny of US taxpayer money go into supporting the education of foreigners, so the Q government will always have to pick up all costs.
I think the infrastructure and development related projects far outweigh the WC projects
Sure, but the WC is putting pressure on Qatar to finish everything before 2022. Without it, Qatar can set reasonable deadlines and prioritize its projects based on the population needs rather than Fifa’s requirements.
Yep, for the time being at least.
I would agree on the WC but the other things are important for the country and have long term value
While you are at it, you should close all schools, ban leisure activities and blow up any religious buildings that are not your particular sect of Islam. Oh, and all women could cover up entirely in black to save money on frivolous clothing.
Getting rid of you and your stupidity should be right up that list.
So much (not so) hidden angst.
Are an idiot?
Tangential is a complete understatement to this one, not sure why Shabina even leave this one around.
The way i see it–he is joking!
or just being racist, it depends on the receiving part.
This year 672 students graduated from all the satellite campuses combined at Qatar Foundation, an increase of more than 20% on last year. And about half of the graduates are Qatari. I’m sure the thousand mark will be passed soon – QU, which is much older, is already at 1300+. One should also take into account that most classes are only offered in English at QF, while most classes at QU are offered in Arabic. Makes a huge difference, studying in your mother tongue or in a foreign language.
still does not even give it -d for a good investment
How about paying Qataris based on their contributions, skills and work ethic, rather than their nationality? That would save a LOT of money.
How about screening expats that come to this country with false qualifiactions and pay the rest of them what they realy worth.
Absolutely. That more rigorous measures are not in place have always baffled me. They should also make a long list of so-called overseas ‘universities’ at to which some Qataris go to get diplomas and then demand the same wage hikes and respect as a fellow national who went to an excellent institution.
Neutral about the first part, “pay the rest of them what they really worth,” Qatar would almost surely end up paying more than what they had been paying currently if this one is to be followed. *looks at non-paid construction workers*
HE is talking about the white-collar workers, the one with false QUALIFICATION & Demanding a higher payroll
Expats and Qataris alike. Too much wasted on both sides.
All with you on the first part, but if you start paying construction workers what they are really worth costs would skyrocket.
NO WAY, QF is one of the worst investments that Qatar have ever made, why not send QATARI student to the main compasses of those university s ?????????????? the cost will be in million not in billions , the land they took would be used for a better cause , less traffic all around DOHA, most of ALL the student will get a better experience studying abroad .
(PAYING QATARIS BASED ON THEIR CONTRIBUTION) thats shows how little you know,,QATAR spend most of its budget on things that are used mainly by EXPAT/VISITORS.
for example when two thirds of education city grads are not Qataris citizen , new hospitals , streets ,etc ,, your not seriously saying the less than 15% of the population are where money are spent on.
Why not send them to the main campuses?
You tell me why Qatari families rarely send their daughters to the US for education. The other problem is that sending your best and brightest abroad runs the risk of them not coming back or being “polluted” with Western culture. If Qatar was a more liberal society, then sending the students abroad would be a more effective use of funds, but it’s not. (You might be OK with it, but your compatriots largely are not). So Education City is the cost of a decent education. Or simply go back to just QU, but the majority of its graduates aren’t Qatari and almost all of its faculty and administrators are expats (so still the same problem as Education City but on an even grander scale).
Are you seriously suggesting that the massive pay raises, government subsidies, ridiculously high salaries for mundane jobs reserved for locals, the zero interest loans (which the government sometimes writes off), and Qatarization (in which companies hire an unqualified or unmotivated Qatari to fill a quota and then an expat to do the job) aren’t costing the economy?
Qataris’ high per capita wealth is a result of the oil and gas that expats extract and distribute, creating government and semi-government profits that are redistributed to citizens through various means. That’s perfectly fine by me. I’m criticizing that approach, and it’s worked to keep Qatar stable. That said, don’t kid yourself that this is incredibly expensive. Just look at how your grandparents’ generation lived and how your generation lives.
BTW–the branch campuses are a small fraction of Qatar Foundation’s budget, probably about 15-25 percent.
your not making any valid point, QA 1300+ graduate , EC (9 universities !!) less than 800 hundred graduate ??? is that what you call a good investment in Education.
other point Qataris = not even 500K ppl
expats (working/living) here= around 1.6 mil (according to you are all working professional ) wont cost the Qatari budget ??? may i suggest MATH 101
Your direct comparison is absurd.
Just because you cannot comprehend the concept of proportional cost does not mean the point is invalid; it just means that you are likely the product of a limited education. Again, as difficult as it clearly is for you to comprehend, EC does not have 9 universities. It has 9 specific programs from a variety of universities. By design, Northwestern, for example, offers only a handful of majors in Qatar, whereas its main campus offers about 100.
A valid comparison is quite simple, at least for the able-minded: How much does it cost to education a student at QU vs. the various EC campuses? In real terms, not simple tuition. Keep in mind that the majority of QU students are NOT Qatari and virtually all of the faculty are foreign.
These are the figures that need to be measured against one another for a reasonable comparison. Then one needs to consider the finished product. An engineering degree from Texas A&M is, by all reasonable measurements, inherently better and thus worth more than an engineering degree from QU.
again , nonsense , if they cant produce a considerable market need , cover their coasts of operating ( they are foreign private universities , the government funding must stop.) give me (numbers of graduates/achievements ) else your words remains just words with no facts .& my suggestion remains standing. HA
Not surprisingly, you once again have no clue what you are talking about. University College London, Virginia Commonwealth and Texas A&M are not private universities.
You’re hysterical. Are you really trying to pretend that Qatar University is on a par with American and European branch campuses at EC?
One thing that everyone seems to forget in this discussion is the research aspect of QF and its connection to some of the great innovation and research work being done at QSTP. I feel that is not advertised enough as Qatar is now on its way to become a global research hub with a lot of collaborative and high value projects being pursued between local and international research groups. You need that sort of dynamic (academia on one side and industrial research facilities on the other) to develop real quality research projects. Setting up a global research hub and building its reputation as Qatar is becoming is not easy and with the help of QF/QNRF/QSTP, etc. requires a lot of investment and that investment will pay massive dividends on the long run.
Also, most of the non-Qatari graduates of QF stay on and continue working in Qatar which means you retain that talent in-house. TAMU-Q graduates for example are highly sought after in local oil and gas companies and at QSTP research entities. TAMU-Q’s Qatari graduates are also top notch and end up getting a lot or responsibilities much quicker, becoming very good managers in about 5-6 years.
still does it cover the coast?????????? those research are funded by the QF so, more burdens to the already exciting one !!!
lets say all the graduates from EC continue the carrier in QATAR (EXPAT& QATARIS) they wont be able cover what was spent by the government because EC is a TAX free , UTILITY FREE (electricirty,water ,gas …) also they dont compare to QU which gives more graduates (QATARIS& EXPATS) . you cannot just keep wasting money on EC and the results dont compare .
Couldn’t agree more. And it isn’t just priorities. The amount of waste in Qatar is phenomenal due to its rapid growth and rushed deadlines.
Sorry don’t agree. Qatar needs the infusion of cash before the gas market collapses in future. It just needs to spend more wisely and at a slower pace
this is a first time for me MIMH. i totaly agree with your point.
If we went out for karak your probably quite like me!
Agree.
One has to say that in the light of this “news” and a possible tightening of the belt, the chances of there ever being a competitive labour market in Qatar look a further million miles away.
“Too much money has been wasted, including on some highly paid useless expats and some pie in the sky projects.”
Don’t forget exorbitant salaries and lending programs that have enabled locals to live unrealistic and unsustainable lifestyles. Pacifying the people with Land Cruisers and the like has been very expensive.
You know you’re dragging this argument down, do you? __|__
Not sure what you mean, but the government subsidies of locals’ lifestyles is incredibly expensive and unsustainable given the ongoing shifts in the oil and gas industry.
The same system has almost destroyed Kuwait.
Yup
Snap back to reality, oh there goes gravity..
The fairy tale type of projects are pushed by the influential minority for two purposes: a show off, and a way to extract mo money for their own pockets.
It’s a competitive Gulf thing !
It also gets a boost of encouragement by the “silence of the lambs “
interesting how QF has more staff then students…
Yes, most the overwhelming majority of the 60 odd centres don’t deal with students, so it is a bad comparison.