Qatar’s government spending rose 2.2% to a record QR178.2bn ($48.9bn) in its last fiscal year, slowing sharply from double-digit increases seen in the previous decade, official data showed.
It was the first time that the government’s annual spending undershot its budget plan since 1990 - a sign of the difficulties which the government is having in pushing forward huge and complex infrastructure
Some big projects, such as a new airport, have been delayed by difficulties in planning, co-ordination and arranging the necessary resources for them. So the government has so far ended up spending less than it aimed to spend.
Total state spending came in slightly below the initial plan of QR178.6bn for the fiscal year that ended in March, finance ministry data released by the central bank showed.
Development expenditure was QR49.3bn, well below the QR62.1bn which the government had originally earmarked for the year.
The 2.2% rise in total spending last fiscal year compared to an average annual growth rate of 24% in 2002-2012. Qatar overspent its state budget by 23% on average during that
Qatar spent a record QR34.1bn on public sector wages in 2012/13, nearly 15% more than in the previous year, the data showed.
But revenue jumped 24.7% to a record QR277.4bn. Receipts from oil and gas sales accounted for roughly 62% of state income in 2012/13, down from 70% in the previous year because of a rise in investment returns and other revenue. Qatar is one of the world’s most active sovereign investors in global markets.
The government’s budget surplus therefore more than doubled to a record QR99.2bn last fiscal year, or 14.2% of gross domestic product.
The government plans to raise spending to QR210.6bn in the current fiscal year as it steps up the infrastructure building programme.
Stock index makes second rise above 10,000 points
Qatar’s bourse yesterday rose back above the psychologically important level of 10,000 points, buoyed by second-quarter corporate earnings and government budget plans. The Qatari index rose 1.3% to 10,038 points, extending its 2013 gains to 20.1%. Trading volume jumped to its highest this month. The index broke 10,000 points last week for the first time since September 2008. “Second-quarter earnings created a momentum in the market,” said Yassir Mckee, wealth manager at Al Rayan Financial Brokerage. Government spending plans are also buoying the market; state spending rose only 2.2% to QR178.2bn in the fiscal year to March because of delays in pushing forward infrastructure plans, but the government aims to raise spending to QR210.6bn this year as projects get underway. Some investors are still looking out for the planned listing of Doha Global Investment Company, a $12bn investment company backed by assets from the state’s sovereign wealth fund.