The ongoing diplomatic and trade embargo notwithstanding, overseas investors appear to be bullish on Qatar's macro fundamentals as Doha's inward foreign investments reported a 5% year-on-year gain to QR682.3bn during the second quarter (Q2) of this year, according to official estimates.
At the end of Q2, 2018, Qatar's outward foreign investments amounted to QR387.3bn, which reported about 16% decline, according to the figures released by the Ministry of Development Planning and Statistics (MDPS).
Of the total QR682.3bn inward foreign investments, as much as 66%, or QR453.4bn, were foreign other investments; 18%, or QR125.5bn, from foreign direct investments; 15%, or QR100.7bn, from foreign portfolio investments and the remaining 1%, or QR2.8bn, from financial derivatives, MDPS said in its foreign investment survey.
The objective of this survey, conducted in collaboration with the Qatar Central Bank, was to cover major enterprises operating in the national economy. However, data could be obtained only from privately owned companies (including banks) and government owned enterprises.
The survey comes in the wake of Qatar taking necessary steps to become a subscriber of International Monetary Funds’ Special Data Dissemination System, under which countries are required to compile and disseminate quarterly foreign investment statistics.
On a yearly basis, foreign direct investments witnessed about 2% growth and portfolio investments by about 6%; whereas those of other investments declined 3%.
Inward FDI grew modestly from QR123.9bn during the first quarter of this year. Similarly, portfolio inflows also showed improvement from QR95.1bn during January-March this year. Although financial derivatives were flat on a quarter-to-quarter basis, foreign other investments registered a slight fall.
The new foreign direct investment law, which is expected to be in place by the end of this year, and the economic zones, are expected to make Qatar a perfect hub for trade/re-exports, Abdulbasit Talib al-Ajji, director of the business development at the Investment Promotion Department at the Ministry of Economy and Commerce (MEC), had said recently at a seminar.
On May 27, 2018, MEC announced a draft law that will allow foreign investors to own 100% of equity in all sectors, which is pending legislative approval.
Of the total QR387.3bn outward foreign investments, as much as 54%, or QR207.7bn, were foreign other investments; 38%, or QR146.6bn, were foreign direct investments and 8%, or QR32.5bn, formed portfolio investments.
On a year-on-year basis, outward foreign direct investments were down about 1%, portfolio investments by 6% and other investments by more than 9%.
On a quarter-to-quarter basis, the absolute levels of foreign direct, portfolio and other investments had shown declines as they amounted to QR147.2bn, QR38.1bn and QR217bn respectively during the first three months of this year.
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