A general view of the exterior of the Hamad International Airport in Doha. Large infrastructure projects such as the HIA, Lusail real estate development, new Doha Port, and Doha Metro will support the country’s growth going forward, according to QNB.
By Pratap John/Chief Business Reporter
With the implementation of large infrastructure projects gearing up and fast growing population boosting domestic demand, QNB expects Qatar’s real gross domestic product (GDP) growth to accelerate to 6.8% in 2014.
Large infrastructure projects, such as the Lusail real estate development, new Doha Port, Hamad International Airport and Doha Metro Rail project will support growth going forward.
Thus, the key driver of growth will continue to be the non-hydrocarbon sector, which is expected to grow from 46% of nominal GDP in 2013 to more than 50% this year, QNB said in its latest “Monthly monitor”.
Qatar’s real GDP expanded at a buoyant 5.6% (year-on-year) in the last three months of 2013, spurred by double-digit growth in construction, wholesale trade and hospitality, and financial, real estate, and business services.
For 2013 as a whole, real GDP grew 6.5%, in line with QNB’s forecast.
Qatar’s population grew 11.6% year-on-year in March to reach 2.14mn.
Population growth in recent months has been driven up by the large ramp-up in infrastructure spending in preparation for the 2022 FIFA World Cup.
The latest population figures for March are in line with QNB Group’s forecast of 10.1% average population growth for 2014, one of the world’s highest population growth rates.
In turn a larger population will feed into higher economic growth by boosting aggregate demand and investment in housing and services.
Rent inflation has slowed in recent months in line with QNB projections, tracking movements in the underlying price of land.
QNB said it has analysed data purely on land transactions in Qatar, based on weekly statistics published by the Ministry of Justice. Land prices are a fundamental driver of rent inflation in Qatar with a six-month lag.
A recovery in land prices between December 2013 and March is expected to increase rents later this year.
Counterbalancing this, foreign inflation is expected to decline in 2014 as international commodity prices remain flat on weak global demand and record food harvests.
“Overall, we expect inflation to pick up to 3.8% in 2014,” QNB said.
Qatar’s merchandise trade balance showed a surplus of QR35bn in February 2014 (2.2% increase year-on-year), the report showed.
The surplus increased as compared with the same period in 2013 primarily owing to higher hydrocarbon export receipts.
Total exports in February stood at QR43.3bn and imports at QR8.3bn.
Japan topped the export destination in November and accounted for 29% of Qatar’s exports, followed by South Korea (24%) and India (12%).
Among Qatar’s major import items (in September 2013) were motor vehicles, aircraft spare parts and telephone sets.
The US was the largest exporter to Qatar in February (11%), followed by China (also at 11%) and the UAE (8%).