Qatar’s non-hydrocarbon sector will play a major role in helping the country’s GDP grow at 3.1 percent this year, according to a report that credits economic diversification for Qatar’s strong growth in non-oil and gas sectors.
Qatar is looking to build on the progress made in 2018 by implementing a series of reforms and projects aimed at further diversifying the economy, the Oxford Business Group (OBG) has said in a report.
Facilitating overseas investment would be the prime objective of these efforts Diversification leads to strong growth in non-oil and gas sectors in Qatar
“Central to this policy is the new foreign direct investment law, which was issued in January 2019,” the report added.
Law No. 1 of 2019 enables 100 percent foreign ownership in most of the sectors throughout the Qatari economy. The new law puts foreign companies on the same legal footing as domestic firms, allowing them to bid on government contracts, while strengthening investors’ rights and the legal standing of companies based overseas.
“These changes dovetail with the establishment of the Qatar Free Zones Authority in 2018,” the report said, adding: two areas currently in development are located close to key logistics centres near Doha — the 30.3-sq-km Um Alhoul free zone and 3.96-sq-km Ras Bufontas free zone.
The report also says the increased activities in Qatar’s gas sector, the stability of its banks and the bristling economy would further provide the push for diversification.
The gas sector saw increased from the beginning of the year after Minister of State for Energy Affairs HE Saad Sherida al Kaabi announced in December 2018 that Qatar would leave the Organisation of the Petroleum Exporting Countries (OPEC) as of January 1, 2019.
Qatar plans to solidify its status as the world’s leading exporter of liquefied natural gas (LNG), the report said.
“An expansion project in the North Field will add four liquefaction trains, raising LNG production from its current level of 77m tonnes a year to 110m tonnes by 2024. This 43 percent increase, along with a planned boost to oil production, should extend Qatar’s standing in international markets.”
The banking sector, the report said, has also been stabilised. Stronger energy prices in much of 2018, combined with the return of foreign liabilities, enhanced liquidity and supported private sector credit growth, according to the IMF.
This was underscored by a 1.5 percent year-on-year (y-o-y) increase in bank deposits in October 2018 and credit growth of 2.7 percent over the same period, the report said, citing Qatar National Bank data.
“Banks also saw a solid 5 percent rise in asset values over the 12 months to the end of October 2018,” it added.
(c) 2019 Qatar Tribune. All Rights Reserved. Provided by SyndiGate Media Inc. (Syndigate.info)., source Middle East & North African Newspapers