Highest GDP Per Capita


Economic News

22 Jul 2010
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Qatar's GDP rose to a record high of $52.7bn in 2006, registering a nominal growth of 24.2% over the previous year while its GDP per capita rose to a record level of $62,914, giving Qatar the highest GDP per capita in the Middle East and among the wealthiest countries in the world.

Thanks to strong hydrocarbons exports, Qatar has enjoyed a healthy trade surplus for the past few years. According to the ministry of finance, Qatar is expecting the budget surplus to reach $1.8bn for the 2006-2007 fiscal year, significantly above its initial forecast of $632m. Revenues were estimated at $19.9bn for the fiscal year completed at the end of March, an increase of 27% year-on-year.

Behind this unparalleled growth lie proactive macroeconomic initiatives and ongoing reforms by the government, designed to develop both the financial sector and capital market.

To this end, Qatar Financial Centre (QFC) was established in Doha in May 2005 with the aim of attracting international financial institutions and multi-national companies. Through the QFC, a new benchmark and independent legal infrastructure was set up.

"Here at the QFC we want to attract quality, not quantity. International institutions are attracted here because we are providing a fair and transparent system that offers the standard of any major financial centre anywhere in the world," Stuart Pearce, chief executive of the QFC Authority, told OBG.

Another step was taken in July 2005 to allow companies to buy back 10% of their own shares to improve share prices.

On April 4, 2005, Qatar officially allowed non-Qatari investors to purchase shares on the DSM. They were allowed up to 25% of the equity of listed companies. In 2005, the DSM had a market capitalisation of $87.1bn, a rise of 115.5%. Since then it has been falling at rates of 30.1% in 2006 and 9.9% in the first quarter of 2007.

However, foreign investors are not allowed to participate in any Initial Public Offering (IPO) while Gulf Cooperation Council citizens have that privilege on some occasions.

Further reforms in 2006 led to significant changes in the capital market, with the Doha Securities Market (DSM) creating a securities market regulatory authority called the Qatar Financial Market Authority (QFMA).

The newly established QFMA started its activities on April 1 and absorbed the DSM in late April. The aim is to form an impartial body that contributes to the development of a sound financial system.

Nasser al-Shaibi, the deputy chief executive of QFMA, commented, "Qatar's economy has grown tremendously over the past few years and has drawn a great deal of financial interest from local, regional and international investors. This interest and resulting increase in activity has led to the need for some controls to be put in place to provide a level of security to investors. We are confident that the regulatory authority structure we have put in place and the competent management team will help to raise investor awareness and will provide them with the protection they enjoy elsewhere in the world".

Thanks to Qatar's new regulatory framework, foreign investors are increasingly looking at Qatar's opportunities, which has been reflected in the amount of foreign direct investment (FDI) flowing into the country. According to the United Nations World Investment Report 2006, Qatar attracted nearly $1.5bn of foreign investment and ranked third among GCC states concerning levels of FDI. Strong fiscal performance and ongoing reforms have also been acknowledged by Standard & Poor's Rating Services which upgraded Qatar's sovereign rating to 'AA-' from 'A+'.

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