Despite huge salary hikes for nationals last August, it appears the majority of Qataris remain in debt, an article in the Financial Times has said.
By some measures, Qatar is the world’s richest country. But its citizens have a tendency to spend extravagantly, and three-quarters of Qatari families are in debt because of this, according to the 2011 National Development Strategy.
Most owe an average of QR250,000. Qatar hopes to halve the number of indebted nationals by 2016, the report states.
The competitive spending culture is further fueled by generous bank loans. Qataris can take out up to QR2m in personal loans, with a repayment period of six years.
And the salary hikes haven’t exactly led to prudent spending – one Qatari interviewed by FT said that upon hearing the news, everyone in his office went out and bought cars.
Last year Qatari authorities tried to raise awareness about the depth of the problem, with a campaign titled “Debt is Disgraceful”, during which donations were collected to help pay money owed by debtors in prison or others threatened with criminal charges.
In a 2008 US diplomatic cable, released by WikiLeaks, one prominent Qatari royal is quoted as telling embassy officials that debt is creating “enormous societal pressure” affecting family life and increasing demands on the government, by creating a “welfare syndrome” where citizens think they can spend freely and be bailed out by relatives and the government.
Here’s what’s the NDS has to say about spending and debt:
Credit: Photo by Christian Senger