Qatar, as a member of the Gulf Cooperation Council, benefiting from a common market with other Gulf states, attracts a number of our clients. The country boasts an abundance of natural gas, as well as sizeable oil reserves. The Qatari government remains popular, thanks to impressive GDP per capita, combined with universal state benefits without any taxation.
We keep our clients informed of the latest market moves and political developments in Qatar, as part of our 'top-down' and 'bottom-up' perspective. Clients also benefit from in-depth analysis on 18 of Qatar’s most important industries. We provide interactive data and forecasting alongside detailed and risk-assessed analysis from our results-proven research teams. Our aim is to keep you one step ahead, so you can operate with confidence in Qatar.
Qatar Country Risk
Qatar's short-term political risk profile remains among the most stable in the region. Despite enjoying little in the way of democratic freedom, Qataris benefit from massive hydrocarbon wealth which is spread generously across the country's native population and enjoy the highest per capita GDP in the world. A small population - and one without much inclination to protest against the government - will keep the country insulated from large-scale public unrest in the immediate term.
The performance of the Qatari economy will be more mixed than in recent years, amidst the intertwined pressures of the global energy slump and tightening domestic liquidity. We forecast real economic growth of 4.4% this year and 4.8% in 2017, driven mainly by strong growth in investments as preparations for the FIFA 2022 World Cup continue....
Qatar Operational Risk Coverage (9)
Qatar Operational Risk
Qatar Operational Risk
BMI View : There are considerable investment opportunities in Qatar, due to the requirements of hosting the 2022 FIFA World Cup, which has resulted in a booming construction sector, the continuing importance of the LNG export market, and a wealthy consumer market. Qatar offers one of the most liberal tax regimes in the world, a lack of bureaucratic obstacles for businesses, and an excellent rule of law, all of which contribute towards a welcoming environment for foreign investment. These are the main factors behind the country's...
Qatar Crime & Security
Qatar Crime & Security
BMI View: Qatar's crime and security environment is one of the most conducive to the secure and safe operation of a business in the MENA region. With relatively low crime rates and highly capable police force, businesses can be assured of efficient crime prevention, thus mitigating costs for insurance and additional security measures. Simultaneously, although the region is notoriously unstable, Qatar faces limited risk of terrorist attacks and enjoys open diplomatic channels with neighbouring states within the MENA region. The country also has robust security forces and a well equipped military. Finally, the country has a limited presence of organised crime and robust financial and cybersecurity protocols and organisations. Overall, Qatar is a regional outperformer in the MENA Crime and Security Risk Index, in third position behind the United Arab Emirates and Oman with a score of 72.1 out of 100.
Qatar Labour Market
Qatar Labour Market
BMI View: Qatar's labour market is restricted, leading to several potential risks for investors. On the positive side, the country's high literacy rates, large migrant population, and low employment costs mean that it comes second in the Middle East and North Africa (MENA) region in the BMI Labour Market Risks Index, scoring 60.4 out of 100. However, these positives mask the serious risks posed to businesses in Qatar due to restrictive labour laws, particularly regarding expatriate workers, and the poor quality of education in the country.
A very high rate of urbanisation, widespread literacy, and a large proportion of the working age population in employment mean that Qatar scores very highly in terms of the...
BMI View : Qatar is well-suited to meet its logistical needs in the short- to mid-term future. With one eye on the upcoming FIFA World Cup, and an overarching focus on achieving the 2030 Qatar National Vision objectives, the country's infrastructure is being overhauled and modernised. Combined with regionally relaxed and cost-efficient trading procedures, Qatar is well placed to ensure that its international trade is maintained at its required levels. For these reasons, Qatar scores 61.1 out of 100, placing it in sixth position regionally.
At present, Qatar's international trading and logistical infrastructure largely caters for the exporting of fossil fuels and the importing of construction materials and food. With the world's largest LNG exporting facility, and several major airport and seaport refurbishment and development projects coming online...
Qatar Trade & Investment
Qatar Trade & Investment
BMI View : Opportunities for investment in Qatar have opened up in recent years due to the requirements of hosting the FIFA World Cup in 2022, which has resulted in a booming construction sector, and the continuing importance of the LNG (liquefied natural gas) export market. Qatar benefits from one of the most liberal tax regimes in the world, a lack of bureaucratic obstacles for businesses, and an excellent rule of law. These are the main factors behind its high score of 63.8 out of 100 in the BMI Trade and Investment Market Risks Index, ranking the country second in the MENA region. Nevertheless, BMI highlights that there are significant risks to foreign investors in Qatar, as the country remains biased in favour of domestic sources of investment, its...
Qatar Industry Coverage (18)
BMI View: We believe that robust economic growth and a large pipeline of infrastructure projects should lead to another positive year for the Qatari new vehicle sales market in 2016. We are targeting 11.3% sales growth for the sector as a whole, with passenger cars set to outperform commercial vehicles.
|Passenger Car and Light Commercial Vehicle Sales|
|f = BMI forecast. Source: QSA, BMI|
Qatar Commercial Banking
|Date||Total assets||Client loans||Bond portfolio||Other||Liabilities and capital||Capital||Client deposits...|
Qatar Consumer Electronics
BMI View: We continue to maintain a positive outlook for the Qatari consumer electronics market and the macroeconomic landscape of the country in general. Qatar will not feel the finch of the prolonged global oil price slump. The economic activity in the country will be bolstered by high incomes, a strong discretionary spending power level, a steady population growth from the influx of migrant workers and the government's continued commitment to investment in the ICT sector. The upcoming FIFA 2022 World Cup taking place in Qatar is also a source of growth at this point and we estimate that it will fuel growth over the next five years. In contrast to other early adopting markets, we envisage medium term growth for device categories including high-end smartphones, tablets and TVs due to the extremely...
Food & Drink
Qatar Food & Drink
BMI View: Qatar will experience sustained growth in its food and drink sector, especially through premiumisation, even though our consumer outlook for the country has deteriorated in recent months. Nonetheless, the small consumer base will limit the attractiveness of the Qatari market for food and drink manufacturers, as well as mass grocery retailers.
|Food and Drink Spending|
|f = BMI forecast. Source: BMI, national statistics|
Qatar Freight Transport
BMI View: Qatar is set to see positive but moderate growth across its two freight transport sectors in 2016. Road freight will see a slight decline from 2015 levels but will stay on a similar trajectory of just under 5% growth over our medium-term forecast period to 2020, while air freight will growth at a marginally faster average rate of 5.1% per year. Although air freight will see a slightly better growth rate than the country's road network, the large majority of infrastructure investment will be channelled towards roads before rail transport (in terms of significantly affecting the total freight mix) comes online in the longer term after 2020.
Qatar's road freight network will benefit significantly from huge infrastructure investments over our medium-term forecast to 2020. Although y-o-y growth will decrease marginally to 4.8% in 2016 from 5.0% in...
Qatar Information Technology
BMI View: Demand for computer hardware held up better in Qatar than most commodity reliant markets in 2015, and we believe Qatar's medium-term outlook is stronger across the whole IT market than the rest of the GCC. Major project spending by the government will drive IT services demand as Qatar engages in major modernization initiatives for the economy and public services, particularly in infrastructure for the FIFA World Cup in 2022. The hardware outlook is weaker, with retail market saturation a placing a limit on growth potential and vendors are reliant on replacement sales. We forecast a CAGR of 5.3% for the whole IT market over 2016-2020 to a value of QAR4.9bn.
Latest Updates & Industry Developments
BMI View: The hosting of the FIFA World Cup 2022 is driving significant investment into the construction industry as Qatar develops major stadiums, improves on its existing transport network to facilitate movement across the country, and increases overall hotel capacity. The government's efforts to diversify its economy away from the hydrocarbons sector is also spurring industry growth, as it directs attention towards the development of knowledge-based sectors.
Forecast & Latest Updates
We are maintaining our forecasts for 13.9% real growth in 2016 and annual average growth of 11.9% in real terms over the next five years up...
BMI View: The insurance market in Qatar has grown at a steady rate in recent years and is expected to continue to outpace most of its neighbours. Strong economic development tied to infrastructure expenditure remains a key driver of insurance demand in a market that remains dominated by five top insurers and an almost exclusive concentration on non-life lines. Life insurance remains in the very early stages of development, with demand mostly coming from expatriate workers.
Qatar Medical Devices
BMI Industry View: The Qatari medical device market will grow strongly over the forecast period, benefitting from key market drivers such as increasing urbanisation, population growth, an expanding health insurance market and massive healthcare developments. The country has so far largely defied the slump in global energy prices, and will continue to record stronger economic growth than the rest of the region over the coming years, benefitting medical device consumption.
Headline Industry Forecasts
We anticipate that the medical device market will register a strong 2014-2019 CAGR of 12.7% in local currency and US dollar terms, ranging from 9.6% for consumables to 17.9% for orthopaedics & prosthetics...
Oil & Gas
Qatar Oil & Gas
BMI View: The moratorium on upstream gas projects will limit the overall level of activity in the coming quarters, while work on a small number of enhanced oil recovery and redevelopment projects continues. We expect the fall in crude production to continue, with downside risk to steeper decline rates if enhanced recovery programmes are scaled back due to capex cuts. Qatar's dominance of the liquefied natural gas export market will increasingly be challenged by other producers, but efforts to diversify the economy away from oil and gas will soften the impact.
The effects of the US shale gas revolution, low oil prices, high construction costs, China's self-sufficiency and the lifting of sanctions on Iran are all downside risks that are likely to prevent Qatar from capitalising on its indigenous resources.
In 2015, expansions in Qatar's plastic industry increased the country's regional market share to 8% of the total in the Gulf Cooperation Council, according to the Gulf Petrochemicals and Chemicals Association (GPCA). However, with prominent planned projects now postponed or cancelled due to adverse market conditions, its position in the region is set to fall back, with Oman seeing strong growth, the UAE adding to its already massive petrochemicals facilities and Saudi Arabia consolidating its lead.
China and India represent the largest markets for Qatar's polyethylene output, but exports to these Asian economic powerhouses are under pressure...
Pharmaceuticals & Healthcare
Qatar Pharmaceuticals & Healthcare
BMI View: Rising demand for healthcare, as well as public and private investment in healthcare infrastructure, will translate to commercial opportunities for pharmaceutical and healthcare operators in Qatar over the forecast period. However, we highlight a deceleration in the pace of government investment in healthcare capital projects as authorities will instead prioritise infrastructure projects related to the FIFA 2022 World Cup. Moreover, Qatar's government will attempt to contain buoyant healthcare costs through the promotion of a greater role by private health insurance providers in the health system, aside from the recent downward price revision for several drug segments in an attempt to harmonise drug prices...
BMI View: Developing greater power capacity and security remains a key focus of the Qatari government. While the country does currently have sufficient capacity, consumption is growing and Qatar will need to rapidly develop additional generation if it is to keep up with rising demand. The government has committed to extensive investment in new power plants over the coming years, though at present few specific project details have been announced. Instead much of the project pipeline is currently accounted for by transmission grid expansion and improvements. Of the expected new power plant developments, we expect the vast majority will be concentrated on natural gas fired power due to Qatar's extensive reserves, with some small investment in the solar power segment as Qatar aims for 2% renewable energy in the mix by 2022.
Qatar Real Estate
BMI View: We have a stable outlook for Qatar's economy in the medium term, reflecting the countries resilience to the collapse in oil prices over 2015. Rising consumer confidence and spending, alongside greater governmental investment, will present opportunities in the retail and office sub-sectors in 2016 and 2017, supported by improvements to infrastructure that will benefit the broader real estate market.
Qatar is an exporter of petroleum and LNG, which accounts for 70% of government revenues, 60% of GDP and around 85% of exports. The dramatic fall in oil prices to under USD30.0 per barrel, a 12-year low, detrimentally affected Qatar, with GDP per capita contracting by 14.6% in 2015 in US dollar terms. We have downgraded our forecast of average annual GDP growth between 2016 and 2020 from 5.8% to 5.2%, highlighting the need for greater economic diversification....
BMI View: As the international oil and gas markets have stabilised, the expansion of Qatar's retail sector is becoming less precarious. We project household spending to grow by 6.8% in 2016, accelerating to 8.2% in 2017. The opening of four major shopping centres from late 2016 into 2017 will attract greater spending from Qataris and wealthy expats, as Doha begins to rival Dubai for regional dominance in retail supply and infrastructure.
|Headline Household Spending|
|e/f = BMI estimate/forecast. Source: National sources, BMI|
BMI View: Qatar's mobile market is growing robustly in subscription terms, but price competition is eroding core service revenues and profit margins. Growth is linked to expansion of the migrant workforce, but this will slow significantly in the medium term. The market benefits from a wealthy population and there is untapped demand for advanced data services, particularly among businesses. Growing interest in video content is also evident, boding well for service diversification strategies.
|3G/4G Upgrades To Support Long-Term Growth|
|Qatar Mobile Market Forecasts|
BMI View: Qatar's tourism industry is set for continued growth over the next four years as the government and private industry continue to invest. There will be continued spending on transport infrastructure, due to high profile international sporting events (such as the 2022 Fifa World Cup), and business tourism continues to grow due to increased exhibitions. Regional instability is a concern, and negative publicity surrounding the awarding of the world cup and questions over the labour conditions are prevalent, but the strong support of the government to the tourism industry should ensure inbound arrivals continue to grow.
BMI View: This quarter we have expanded and revised our forecasts to include water extraction by source, mains and household consumption, losses and treated wastewater. Overall, although we see Qatar as one of the most active water infrastructure sectors due to the extensive investment being undertaken in the run up to the 2022 FIFA event, we continue to view the overall water and sanitation services as underdeveloped, particularly the latter, due to the lack of adequate sewage networks and treatment facilities.
Qatar is one of the largest per capita water consumers in the world, with consumption levels quadruple that of the average European consumer. In order to cater to the vast consumption levels and limited freshwater reserves, the country is focusing on a massive reservoir-...