Qatar has announced that its economy’s growth accelerated in the second quarter of 2015, despite oil prices tumbling.
Real GDP grew by 4.7% year on year, according to the latest data released by the Ministry of Development Planning and Statistics (MDPS), compared with 4% in 2014.
The ministry in a statement, carried by the official Qatar News Agency (QNA), says that in continuation of the Qatari economic trend of the last few years, the non-hydrocarbon sector “was the engine of growth”.
“A string of other releases show a continuation of growth and diversification into the third quarter despite substantially lower oil prices. This manifests itself in low inflation, strong population growth and large external surpluses,” the ministry statement says.
The hydrocarbon sector’s GDP remained largely unchanged in Q2, rising by only 0.9% year-on-year. Production remained stable, due to maturing oil fields and the moratorium on further gas production from the North Field which Qatar shares with Iran (where it is known as the South Pars gas field).
With gas production set to increase in Qatar, the ministry expects economic growth to further accelerate to 6.4% in the 2016-17 fiscal year.
As with all other GCC economies, economic diversification continues in Qatar, with the share of the non-hydrocarbon sector in GDP rising to 61.7% in Q2 2015 from 59.8% in the previous quarter.
The non-hydrocarbon sector is expected to grow further in Q3, even though oil prices have fallen by 19.4% during the quarter.
The non-hydrocarbon sector expanded by 9.1% year-on-year in Q2 2015, the QNA report says, with financial services, construction and trade, hotels and restaurants, being the biggest contributors to the sector’s growth. Construction activity grew by 19.7% year-on-year on the back of ongoing infrastructure projects in the country.
“This suggests that Qatar is capable of weathering lower oil prices thanks to a favourable macroeconomic environment characterised by low inflation, large external surpluses and healthy fiscal balances,” the ministry statement reads.
