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 5.0% this year and 4.8% in 2017, driven mainly by strong growth in the primary and secondary sectors.
Lower hydrocarbons prices...
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 some of the fastest consumer spending growth in the region, translating into sustained growth in the food and drink sector, especially through premiumisation. Nonetheless, the small consumer base will limit the attractiveness of the Qatari market for food and drink manufacturers, as well as mass grocery retailers.
Headline Industry Data (local currency)
2015 food consumption growth = +6.0%; compound annual growth rate (CAGR) 2014 to 2019 = +5.5%.
2015 bottled water value = +13.2%; CAGR 2014 to 2019 = +12.1%.
2015 mass grocery retail sales = +7.5%; CAGR 2014 to 2019 = +6.9%.
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: Qatar's economic outlook is brighter than its peers in the GCC - and this is reflected in our relatively strong outlook for IT spending growth over the medium term. Major government projects to modernise the economy and public services, as well as investments in infrastructure ahead of its hosting of the FIFA World Cup in 2022 all create a robust outlook for software and services spending over 2016-2020. The hardware outlook is weaker, with retail market saturation a placing a limit on growth potential as vendors are reliant on replacement sales, but with high per capita incomes and a fashion conscious consumer base it will continue to be lucrative to premium vendors. 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: Qatar is the fastest-growing construction and infrastructure market in the GCC and remains one of our favourite construction markets, buoyed by huge government investment, a stable business environment and growing consumer demand. The 2022 FIFA World Cup is a catalyst for growth, but Qatar's need to diversify its economy will mean the majority of major infrastructure projects would be needed, even with the event. The industry is navigating capacity constraints seemingly well, although we still believe wage and material price pressures will be a drag.
Key Trends And Developments
Oil prices are a minimal downside risk to our forecast, given...
BMI View: Qatar's insurance sector will outperform the majority of Western markets over the next few years as a robust economy, high income levels and large scale public investment drive growth. Growth will be particularly intense over 2015-2017, due in large part to a surge in motor vehicle underwriting, before subsiding to a more moderate level towards the end of the forecast period. However, the dominance of domestic insurers and the absence of any life insurance market of note will continue to deter many of the larger multinational players.
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: We remain positive in our outlook for Qatar's pharmaceutical and healthcare markets, in spite of lower oil prices. Government commitment to maintaining quality healthcare provision and the roll-out of health insurance will both drive expenditure growth.
Headline Expenditure Projections
Pharmaceuticals: QAR1.79bn (USD491mn) in 2014 to QAR2.00bn (USD548mn) in 2015; +11.5% in local currency and US dollar terms. Forecast unchanged from Q415.
Healthcare: QAR17.25bn (USD4.74bn) in 2014 to QAR18.86bn (USD5.18bn) in 2015; +9.3% in both local currency and US dollar terms. Forecast...
BMI View: Investment continues in Qatar's power sector, as the government seeks to ensure it maintains an energy surplus as well as securing the country's vital desalinated water supplies. Although a relatively small market, extensive investment in transport and social infrastructure will ensure that demand for electricity remains high and there are a number of power projects in the pipeline. Qatar's power sector remains dominated by natural gas fired power, supported by extensive natural gas reserves, though we are now seeing a gradual foray into renewable energy, particularly solar power, as the country begins the process of diversifying the domestic energy mix.
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: Despite the recent oil and gas slump, Qatar's economy will remain relatively resilient throughout our forecast period, from 2016-2020, with notable infrastructure projects, like the FIFA world cup, providing important support. We believe this will bode well for the retail sector, which is continuing to expand on the back of a growing population and rising income levels. The country's increasingly large choice of modern retail space will also act to attract new entrants into the market.
|Headline Household Spending|
BMI View: In 2015, Qatar's mobile market continued to experience robust growth, outperforming our initial forecasts. Key factors contributing to the expanding subscriber base include the growth of the migrant population, which is associated with major infrastructure and economic development projects - including those related to the upcoming 2022 FIFA World Cup. Although positive subscriber growth will continue for the duration of our forecast, we expect it slow significantly in the later forecast years. Qatar's telecoms market benefits from a wealthy population and this drives demand for advanced data services. High ARPU is underpinned by the uptake of LTE and fibre services in the country, as well as multiple-SIM ownership through multiple-device ownership (smartphone, tablet, dongle)....
BMI View: The outlook for Qatar's tourism industry is highly positive. The country is hosting several high profile global sporting events over the next decade and as well as boosting investment in supporting infrastructure. These events will also help to grow Qatar's reputation as a holiday destination in the competitive Middle East region, where countries such as the United Arab Emirates already have a well established tourism industry. Supporting the growth of tourism is the extensive hotel and accommodation sector, which focuses particularly on lucrative luxury and business travel. The quality budget to mid-range sector is less developed and it is this sector which is expected to see rapid growth moving forward as the country prepares to welcome an influx of foreign...
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-...