Bhatia during the interview with Gulf Times. PICTURE: Jayan Orma. Right: Hamad Port’s first vessel, heavy load carrier Zhen Hua 10 from China, which arrived at the new port at Umm Alhoul in Mesaieed last month. There is a lot of required development taking place in Qatar and the momentum of the economy today is fuelled by government expenditure, Alpen Capital MD Sanjay Bhatia says. PICTURE: Jayaram
By Peter Alagos/Business Reporter
Infrastructure growth and economic development is expected to continue in Qatar even as oil dropped below $50 per barrel on Friday, an official of Alpen Capital Investment Bank said.
Owing to uncertainty over China’s economic outlook, the rise in production from Organisation of Petroleum Exporting Countries (Opec) and a strong dollar, Brent crude on August 7 closed down 1.8% at $48.61 per barrel, while West Texas Intermediate slipped 1.7% to $43.87/b.
But Alpen Capital managing director Sanjay Bhatia has expressed optimism over the momentum of Qatar’s economy, which, according to him, is driven by a significant amount of “planned” government expenditure.
“Qatar is a very resilient economy, and it is growing at a very rapid pace. There is also a lot of required development taking place and the momentum of the economy today is fuelled by a lot of government expenditure.
“But from an internal infrastructure growth and economic development perspective, I think that is a story which will continue; and we at Alpen don’t see a major impact to that because of the drop in oil prices,” Bhatia said in an interview yesterday.
But at the same time, he also believes that the government may take its time when pursuing new projects and other outbound investments.
“The economy is running on planned expenditure. But for new projects, I think at this point in time, they will definitely be carefully evaluated, and there won’t be any rush to put up new projects,” he said.
He added, “If I look at Qatar’s outbound investment, which was very much in the press most of the time, all that are likely to slow down a little bit.”
Citing “a wider GCC perspective,” Bhatia said the slump in oil prices, coupled by the devaluation of the ruble and strengthening of the dollar, may have a short-term impact on the tourism industry.
“While Qatar is still not so dependent on tourism today, the government is well aware that amid the volatility in oil prices, it pays on focusing on developing ancillary industries and creating industrialisation in Qatar with a clear focus on the environment, making sure everything is environment-friendly,” he added.
Alpen Capital Investment Bank (Qatar), an investment banking advisory firm, is located at the Qatar Financial Centre and authorised by the Qatar Financial Centre Regulatory Authority.
