Qatari authorities are forging ahead with growth plans by emphasising economic diversification in line with Qatar National Vision 2030, while also kick-starting the process of increasing the output of liquefied natural gas (LNG) by roughly two-thirds. In parallel with the construction of six new LNG trains, the country is also in the process of building the Middle East’s largest single-site ethane cracker, which is set to boost the output capacity of a greater range of petrochemical products. In the wider economy Qatar has a $190bn pipeline of mega-projects, many of which will be completed in time for the 2022 FIFA World Cup. The football tournament will be watched by billions of people around the world, with an estimated 1.7m spectators expected to visit Qatar itself, and as such it represents a unique showcase for the country’s economic achievements as well as an opportunity to highlight its plans for the future.

Structure & Oversight

Qatar’s government structure consists of the Council of Ministers, ministries, supreme councils and other government bodies. Executive power rests with the Amir, who is head of state, with guidance from the Council of Ministers. The Advisory Council, also known as the Shura Council, is the seat of legislative power. The Shura Council has 45 members, 30 of whom are elected, with 15 appointed by the Amir. The Shura Council sits for eight months from October each year and deliberates on proposed laws as well as economic and social policies referred by the Council of Ministers. It also considers the general budget for public projects. The prime minister presides over the Council of Ministers, while individual ministries are responsible for the implementation of government policy. The Ministry of Finance regulates financial policies, and drafts and implements the state budget.

Other key economic institutions in Qatar include the financial sector regulator Qatar Central Bank (QCB) and the Supreme Council for Economic Affairs and Investment, which oversees matters relating to energy, economy and investment of the state’s reserves. The Qatar Financial Centre, an onshore financial services centre, has its own regulatory authority and a legal framework based on English common law. The Qatar Investment Authority (QIA), the sovereign wealth fund, was created in 2005 to manage and invest surplus hydrocarbons revenue. The fund seeks to cultivate a diversified portfolio of international assets to reduce the risk of Qatar’s fortunes being too closely aligned with global oil prices. The QIA, which has estimated assets of over $300bn, has significant domestic investments in listed companies across a range of strategic sectors including banking, energy and food security.


In 2019 the IMF stated that Qatar had successfully weathered the economic impacts of falling oil prices in 2014-16 and the ongoing blockade that started in 2017. The IMF’s report, published in June 2019, was based on meetings held in Doha and an analysis of the country’s economic performance in 2018. It noted Qatar had withdrawn from the Organisation of the Petroleum Exporting Countries, effective from the start of 2019, to focus on its gas sector, which produces one-third of the world’s LNG. In addition, the country report acknowledged that Qatari authorities had made further efforts to diversify the economy and that infrastructure spending ahead of the 2022 FIFA World Cup was also a central driver of non-hydrocarbons growth. In 2018 the non-hydrocarbons sector grew by 6.5%.

In June 2019 the IMF estimated that real GDP growth in 2018 reached 2.2%, up from 1.6% in 2017. The central government’s fiscal position, meanwhile, shifted from a deficit of 6.6% of GDP in 2017 to an estimated surplus of 2.3% of GDP in 2018, on the back of higher hydrocarbons prices and more restrained expenditure. The current account was estimated to have reached 9.3% of GDP, compared to 3.8% of GDP in 2017, mainly due to oil prices. The IMF noted that the “hydrocarbons price volatility is the primary source of risk to the macroeconomic outlook”, but insisted that there were ample fiscal and external buffers in place to address these downside risks. According to data for the second quarter of 2019 from the Planning and Statistics Authority (PSA), GDP at current prices decreased by 3.9% year-on-year, while quarterly GDP at constant prices declined by 1.4%. In that same period the mining and quarrying (oil and gas) sector’s nominal value added fell by 9.5%, while in real terms it fell by 1.7%. The non-hydrocarbons sector of the economy also recorded modest contractions in nominal terms of 0.6% and 0.3% in real value added.

At current prices, the two key sectors of manufacturing – which includes petrochemicals – and construction saw declines of 12.1% and 6.5% year-on-year, respectively, in the second quarter of 2019. The decline in the construction sector was due to the completion of major projects ahead of the 2022 FIFA World Cup, but a strong pipeline of new developments looks set to support the sector beyond the tournament. The manufacturing sector’s performance, meanwhile, was negatively affected by falling commodities prices.

Oil Prices

The 2019 annual report by Industries Qatar, a listed company with a controlling interest in many of the country’s downstream businesses, demonstrated the extent of the impact of the global lower oil price environment. Although the group’s sales only fell by 2%, its net profit of QR2.6bn ($713.6m) represented a drop of 49%. The firm’s revenue decreased by 16%, from QR16.3bn ($4.5bn) in 2018 to QR13.7bn ($3.8bn) in 2019. Qatar’s budgets for 2018-20 were based on oil prices of $45 a barrel in 2018 and $55 for the following two years. While these predictions proved conservative in both 2018 and 2019, there were signs the 2020 estimate might leave a smaller margin for error.

The US Energy Information Administration noted average Brent crude prices stood at $71.19 in 2018 and $64.37 in 2019, and forecast an average price of $61.25 in 2020, on the back of a 1m barrel-per-day increase in global demand for petroleum and liquid fuels. Its report factored in the impact of global events in the first month of the year: in early 2020 two new global threats emerged, with implications for both the supply and demand of Qatar’s hydrocarbons wealth. First, global supply fears in the wake of the US assassination of an Iranian general saw Brent crude prices peak at some $70 a barrel on January 6, 2020. Prices subsequently tumbled to around $20 a barrel in early April, driven in part by weaker demand forecasts as a result of Covid-19 paralysing much of the global economy.

Fiscal/Monetary Policy

In its budget for 2020, planned expenditure totalled QR210.5bn ($57.8bn), the highest in over five years and up 1.9% on the QR206.6bn ($56.7bn) spent in 2019. Expected revenue was steady, at QR211bn ($57.9bn), for an anticipated surplus of QR500m ($137.2m), compared to QR4.4bn ($1.2bn) in 2019. The allocation for minor public capital expenditure was down 10.3%, while spending on major projects nudged up 0.6%. An increase of 3.3% in the salary and wage bill was attributed to a rise in headcount on the government payroll, due to staff requirements at recently completed schools, hospitals, health centres and transport facilities, such as the Doha Metro. In 2018 and 2019 Qatar tapped international bond markets to raise $24bn, which will be used to amortise external debt maturing in the near and medium term.

At the end of December 2018 international reserves reached $30.5bn, compared to $15bn at end-2017, thanks to higher oil and gas prices. By the end of November 2019 foreign reserves had risen to $40bn. The IMF noted that while the reserves might not be particularly high by global measures, they were bolstered by sovereign wealth fund assets. The QIA was estimated to control $320bn of assets, equivalent to 166% of GDP and 345% of public debt, as of mid-2019.

Inflation has remained low, decreasing from 0.5% in 2017 to 0.3% in 2018. Over the four quarters of 2019 inflation evolved from -1.3% to -0.6%, 0.1% and -0.3%, respectively. The Qatari riyal is pegged to the US dollar, and the central bank largely follows increases in the US reserve rate. The country’s banking system has weathered the immediate impact of the economic blockade thanks in large part to coordinated public sector intervention, with the QCB reporting that the liquidity situation in the banking system improved over the course of 2018. This allowed liquidity supports supplied by the government through foreign currency in 2017 to be withdrawn in 2018, while at the same there was a decline in public sector deposits.

The IMF declared the Qatari banking sector to be healthy in 2018, with a 16% capitalisation ratio, an average return on assets of 1.6%, a non-performing loan ratio of 1.7% and a liquid-assets-to-total-assets ratio of 29.7%. Nevertheless, the country’s banking system would still benefit from more thorough credit checks. “The Qatar Credit Bureau can make it easier for companies to analyse customers by providing an accurate and full credit history,” Sheikha Maryam bint Khalifa Al Thani, the CEO of Qatar Credit Bureau, told OBG. “The more people and organisations begin to realise the power of having this information, the more likely a credit score will be required.”

In 2018 the Qatar Exchange (QE) Index rose by 20.8%, making up for losses in 2017, when the market contracted by 18.3%. There was a flatter performance in 2019, with the QE Index gaining 1.23%, overall trading value declining by 1.16% and market capitalisation falling by 1.01%. In its 2019 Qatar report the IMF forecast average Brent crude prices to range from $61.80 in 2019 to $60.40 in 2022. However, lower Brent crude prices in the first quarter of 2020 appear set to contribute to a deteriorating fiscal position and rising public debts. The 2020 budget made no mention of the potential introduction of value-added tax (VAT). Although VAT would provide an alternative source of state revenue, its impact on Qatar’s trade within the GCC would make no difference until Oman and Kuwait introduced the tax, as the states that have implemented the levy thus far are participating in the economic blockade against Qatar.


The economic blockade also forced Qatar to reshape its regional trade routes, replacing imports from Saudi Arabia and the UAE with goods brought in through existing GCC partners Oman or Kuwait. Additionally, Qatar has come to rely more on trading partners in Iran, Turkey, India and Morocco. The blockade also saw state-owned airline Qatar Airways fly in cargo that may have otherwise come by road. A number of local players in the food industry, such as 100% Qatariowned dairy company Baladna, have expanded rapidly to fill the void that has been left by imports, leading the drive towards greater self-sufficiency.

Trade data for November 2019 shows that by value, the US, China, the UK, Germany and India are the topfive import markets, with automotive, aerospace and telecoms equipment being the main products. In the same month the top-five destinations for exports were Japan, China, South Korea and Singapore. The three most valuable exports were gas and gaseous hydrocarbons: LNG (QR14bn, $3.8bn), crude oil (QR4.25bn, $1.2bn) and refined petroleum products (QR1.1bn, $301.9m). “The expansion of LNG will be a key driver of economic growth over the next few years,” Mohamed Gad, CEO of Standard Chartered Bank, told OBG. “The capital expenditure the government has committed for Hamad Port, Hamad International Airport and urban planning will also cater to economic growth.”

Although most trade between blockading nations and Qatar has ceased, the country has honoured its commitment to supply natural gas to the UAE through the Dolphin pipeline. As part of its efforts to increase LNG output by 64% by 2027, state-owned Qatar Petroleum has announced that the firm will need a fleet of more than 100 extra ships to carry LNG to its export destinations. Close to home, the biggest potential disruption to exports would be the geopolitical crisis that closed the Strait of Hormuz between Iran and Oman. Qatar has retained close diplomatic ties with Iran in recent years despite the impact of US sanctions on Iranian exports. Qatar has the resources to rapidly expand its output of LNG and other valuable hydrocarbons products, but its political isolation and geography mean there are no alternative overland routes for LNG and oil exports if the Strait of Hormuz is closed.

East Ties

Further afield, Qatar was working to keep trade flowing with China during the Covid-19 outbreak. Qatar Airways suspended flights to mainland China on February 3, 2020 as governments elsewhere placed restrictions on crew who had visited the country. However, the airline pledged to resume operations as soon as restrictions were lifted. On February 13, 2020 Qatar Petroleum announced it was prepared to reroute or reschedule deliveries of LNG to accommodate import or trade restrictions imposed in China itself. Trade data showed China imported QR4.2bn ($1.2bn) worth of goods from Qatar in January 2019, representing 17.2% of total exports, while Qatar imported around QR1.1bn ($301.9m) worth of Chinese goods, or 12.7% of the total.


Qatar National Vision 2030 has created a blueprint for diversification to cushion the economy from future swings in demand for commodities. New measures were taken in 2019 to encourage foreign direct investment, including legal changes to allow 100% foreign ownership of companies in most sectors, excluding financial services and insurance. A new government body – the Investment Promotion Agency – was formed to streamline procedures for businesses interested in locating to the country. Qatar Financial Centre, an onshore hub with its own legal and regulatory framework, saw registered business numbers increase by one-third in 2019. The prospect of hosting 2022 FIFA World Cup has prompted Qatar to spend hundreds of billions of dollars on stadia, transport links and other infrastructure. Residents are seeing the benefits of these projects, which include improvements to expressways and the opening of the Doha Metro. Government planners are also looking beyond the hosting of the event to ensure that it has a lasting economic legacy, by developing the project pipeline.


Although Qatar faces the challenge of diversifying its economy, the country does not face the same levels of pressure to find work for its young nationals as some of its neighbours. The most recent PSA estimate of the population in the third quarter of 2019 was 2.77m and that of the economically active population was 2.06m. This was made up of 1.95m expatriates and 109,000 Qataris. The unemployment rate sat at just 0.1%, with the unemployment rate for Qataris at 0.2%, though this was slightly higher for Qatari women, at 0.3%. In January 2020 Qatar introduced new labour laws for expatriates, giving foreign workers the right to change jobs and allowing them to leave the country temporarily or permanently during their contract of employment. The law also gave workers a non-discriminatory minimum wage, which the UN described as regional first. Qatar has been working with the International Labour Organisation since 2017 to reform its employment laws. “Qatar is changing,” Sharan Burrow, general secretary of the International Trade Union Confederation, said in a UN report. The new tranche of laws is aimed at eliminating the kafala (sponsorship) system and implementing modern industrial relations.

In a country with such a large proportion of expatriate workers, up-to-date information on the population is vital for economic planners. “In the 2015 census Qatar made use of a multi-modal approach to data collection with face-to-face interviews and the latest electronic devices, onto which geographical maps of each area covered by the researcher were downloaded,” Saleh bin Mohamed Al Nabit, president of the PSA, told OBG. “Qatar has since experienced an increase in population, and the 2020 census will require the administrative records of various government agencies around the country.” The aim of the new census was to create a high-quality central register of the population, with comprehensive coverage and a system for the continuous and simultaneous updating of this data. The final phase of the data collection was set to take place between March 22 and April 10, 2020.

“In Qatar there are frequent and substantial changes in the shape and characteristics of our population, including the occupations, educational qualifications and length of time people have lived here, and so we hope the census will prove to be an invaluable tool for planners and strategists across important government departments such as health, education and commerce,” Nasser Almohdi, director of the PSA’s Department of Censuses, Surveys and Statistical Methods, told OBG.


Qatar shipped its first LNG cargo to Japan a quarter of a century ago, and since that time the economy has expanded rapidly, in large part due to its new-found source of wealth. For the decade ahead the government has created a clear roadmap with Qatar National Vision 2030, which focuses on diversification and growth with a retention of the country’s key cultural values at its heart. Although much of the focus in recent times has been on infrastructure preparations for the 2022 FIFA World Cup, it is the period following the tournament, when new LNG and petrochemicals cargo starts to be shipped, that will have a more significant lasting impact on Qatar’s broader development.