Qatar's nominal GDP forecast at nearly $211bn this year, $222.4bn in 2024: Emirates NBD

Qatar's nominal GDP has been forecast at nearly $211bn this year and $222.4bn in 2024, according to the latest update by Emirates NBD.

The regional banking group has forecast the country’s real GDP growth at 2.3% this year and 3% in 2024.

The country’s current account surplus (as a percentage of GDP) has been forecast at 32.1% this year and 29.3% in 2024.

The budget balance (as a percentage of GDP) has been forecast at 5.6% this year and 6% in 2024.

Emirates NBD forecasts Qatar’s CPI inflation at 3% this year and 2.5% in 2024.

Recently, the regional banking group revised its 2023 GDP growth forecasts for several GCC countries lower, following the announcement of voluntary oil production cuts by Saudi Arabia, the UAE, Kuwait and Oman from May through the end of 2023.

For the region as a whole, it has forecast headline GDP growth at 2.3% for 2023, down from 3.2% previously.

It had already revised its forecasts for GCC budgets lower on the back of its downward adjustment to the 2023 oil price estimate in March. Reducing the amount of oil produced and sold will further negatively impact budget revenues for oil exporting countries.

For the whole GCC, the forecast budget surplus for 2023 is now 1.8% of GDP, from 2.5% previously.

Emirates NBD now expects Saudi Arabia to run a close to balanced budget, while Kuwait is likely to post a small deficit of -0.3% of GDP. The UAE’s forecast surplus has been reduced to 5.6% of GDP from 6.2% of GDP previously.

With fewer barrels of oil produced this year, the break-even oil price (the oil price required by each one in order to balance the budget) rises as well, unless government spending is reduced proportionately or non-oil revenues increase.

The UAE’s breakeven oil price is not easy to estimate as revenues are split into tax and non-tax revenue (not oil and non-oil). However, Emirates NBD thinks the UAE’s break-even oil price in 2023 is likely to be between $60-$65 for a barrel, the lowest in the GCC.

“Current account surpluses have also been adjusted to reflect lower volumes of oil produced and exported relative to expectations at the start of the year. All GCC countries are still expected to run current account surpluses in 2023, with the weighted average for the region at 12.5% of GDP this year, down from an estimated 16.8% in 2022,” noted Khatija Haque, Emirates NBD head of research & chief economist.