The outlook for Qatar is a lot better than it is for many other countries, noted Commercial Bank Group CEO Joseph Abraham.
Replying to a question by Gulf Times at a media event at the Commercial Bank Plaza Tuesday Abraham said: “I am very optimistic about the outlook as Qatar’s macroeconomic fundamentals are strong. The North Field expansion will create new business opportunities for Qatari banks. Especially on the downstream, lots of local sub-contractors will get involved. We will have an opportunity to finance them.”
The North Field expansion plan, which is the global industry’s largest ever LNG project includes six LNG trains that will ramp up Qatar’s liquefaction capacity from 77mtpy to 126 mtpy by 2027.
Also, Qatar’s projects on the downstream hydrocarbon sector such as the Petrochemical Complex at Ras Laffan will have a multiplier effect on the national economy.
He said the FIFA World Cup Qatar 2022 has “put Qatar firmly on the global map.”
This, Abraham said, will facilitate more investments and visitors to the country.
“I believe the population will rise with more people coming in to implement projects such as North Field expansion and the Petrochemical Complex.”
Higher energy and commodity prices are beneficial for Qatar. “And so I think that's very positive for long term.”
He said: “We have also seen the debt to GDP coming down in Qatar. The government has prudently used it.”
That said, Abraham noted: “There might be some imported inflation because Qatar imports commodities. But I think the impact will be mitigated to some extent with Qatar’s efforts in achieving self-sufficiency, especially in dairy and agriculture.”
“And banks are the ultimately proxy for the economy. So if our economy is in good shape, we as banks can grow faster.”
Abraham, however, said issues such as fears of recession, inflation and the Ukraine crisis are all challenges facing the global economy and the financial system.
On Commercial Bank Group’s 2022 results, the CEO said: “We reported strong set of results for the year that ended in December 2022, maintaining the momentum and strong execution of our five-year strategic plan.
“Commercial Bank Group reported consolidated net profit of QR2.8bn for the period, up 22% compared to the previous year, driven mainly by an improvement in operating income and higher contributions from our associates.”
He added: “S&P Global Ratings upgraded their long-term issuer credit rating on Commercial Bank to 'A-' from 'BBB+' and affirmed the 'A-2' short-term rating. The outlook remained stable. This reflects recognition by external agencies of the strong execution of our strategy resulting in improved operating performance and strong capitalisation.”
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Local banks to gain from Qatar's strong macroeconomic fundamentals: Commercial Bank CEO
Commercial Bank Group CEO Joseph Abraham (centre) with Rehan Khan, chief financial officer and Hussein al-Abdulla, chief marketing officer at the media roundtable at the Commercial Bank Plaza Tuesday. PICTURE: Thajudheen
