Qatar is on track for a full post-pandemic recovery, according to survey data.
Qatar’s non-energy private sector economy continued to expand towards the end of 2020, according to the November Purchasing Managers’ Index (PMI) survey data.
The PMI rose to 52.5 in November, from 51.5 in October, signalling an improvement in operating conditions in the non-energy private sector. The latest reading was the seventh-highest on record since the series began in April 2017, compared with a long-run average of 49.6.
The Qatar PMI indices are compiled from survey responses from a panel of around 400 private sector companies. The panel covers the manufacturing, construction, wholesale, retail, and service sectors, and reflects the structure of the non-energy economy.
“Growth rates for output and employment both accelerated during the month, with strong performances emanating from manufacturing and construction,” said Sheikha Alanoud bint Hamad Al Thani, Managing Director of Business Development at Qatar Financial Centre.
“New business growth also remains elevated and companies reported increasing pay packets as activity levels returned to pre-pandemic normal. Overall the PMI data are signalling a sustained rebound in GDP in the second half of 2020 following a short, sharp downturn in the second quarter,” said Sheikha Alanoud said.
Manufacturing has strengthened the most in the month of October, followed by construction, wholesale and retail. Construction companies have had the sharpest expansion in jobs, the data shows.
In terms of manufacturing, output is primarily to foreign markets in East Asia, where the effects of the pandemic have been well contained. Locally, the handling of the pandemic has resulted in safe operating conditions for labour-intensive construction activities.
New business growth was again sufficiently strong to generate rising levels of incomplete work for the second month running, and non-energy private sector firms raised average wages and salaries in November as business levels returned to normal.
Meanwhile, purchasing prices fell and charges levied for goods and services decreased slightly, reflecting seasonal promotion activity.
The monthly PMI can be aggregated to a quarterly average to enable comparisons with official Gross Domestic Product (GDP). The PMI data for the third quarter of 2020 are consistent with a 2.7 percent year-on-year increase in GDP, and data for the first two months of the fourth quarter are signalling a further increase of 1%.
Year-to-date PMI data confirms Qatar’s economic trajectory is more in-line with what is observed in China and other East Asian economies with a V-shaped recovery, rather than that seen in Europe or the United States.