Global credit rating agency Capital Intelligence (CI) has affirmed the long-term foreign currency rating (LT FCR) and long-term local currency Rating (LT LCR) of Qatar at ‘AA-’.
The sovereign’s short-term FCR (ST FCR) and short-term LCR (ST LCR) have been affirmed at ‘A1+’. The outlook for the ratings remains "stable".
The ratings are supported by Qatar’s very strong external position, with large current account surpluses and substantial government assets under the management of the sovereign wealth fund, the Qatar Investment Authority (QIA).
The ratings are also supported by the sovereign’s very large hydrocarbon reserves, high fiscal strength, and low domestic political risk.
Qatar’s public and external finances are very strong, reflecting large surpluses and substantial holdings of external assets. The QIA’s total assets are estimated to be in the region of $450bn (around 199% of gross domestic product or GDP in 2022), largely amassed during periods of high hydrocarbon prices.
Qatar’s fiscal and external positions continue to benefit from the sharp surge in hydrocarbon prices and increasing demand for Qatari liquefied natural gas (LNG).
According to CI’s estimates, gross central government debt (including short-term treasury bills and overdrafts from banks) is expected to decline further to 56% of GDP in 2022, from a peak of 73.6% in 2020, reflecting nominal GDP growth and large primary budget surpluses.
It expects debt dynamics to remain favourable in the medium term, resulting in a further decrease in the central government debt ratio to 50.4% in 2024.
CI expects that the current account surplus will increase to 19.8% of GDP in 2022 (14.5% in 2021), and to average 12.6% in 2023-24. The central government budget surplus is also expected to triple to 12% of GDP in 2022 (4.1% in 2021), and to average 9.1% in 2023-24.
Qatar’s ratings are underpinned by very large hydrocarbon reserves (around 12.9% of global gas reserves) and associated export capacity, which in turn provide the government with substantial financial means.
Given the large hydrocarbon exports and rather small population, GDP per capita is expected to exceed $80,000 this year.
Qatar’s economic strength is deemed moderate, reflecting dependence on hydrocarbons which accounted for 37% of GDP in 2021. Economic activity has picked up since 2021 in view of the rebound in both the hydrocarbon and non-hydrocarbon sectors.
"We have upwardly revised our GDP growth forecasts for 2022 to 4.5% (previously 4%), reflecting the increase in LNG production," the rating agency said.
Moreover, non-hydrocarbon activity, particularly in the services sector, is expected to be supported by the hosting of the 2022 FIFA World Cup. The short- to medium-term growth outlook remains "favourable", with real GDP expected to grow by an average of 3.9% in 2023-24.
The sovereign’s short-term FCR (ST FCR) and short-term LCR (ST LCR) have been affirmed at ‘A1+’. The outlook for the ratings remains "stable".
The ratings are supported by Qatar’s very strong external position, with large current account surpluses and substantial government assets under the management of the sovereign wealth fund, the Qatar Investment Authority (QIA).
The ratings are also supported by the sovereign’s very large hydrocarbon reserves, high fiscal strength, and low domestic political risk.
Qatar’s public and external finances are very strong, reflecting large surpluses and substantial holdings of external assets. The QIA’s total assets are estimated to be in the region of $450bn (around 199% of gross domestic product or GDP in 2022), largely amassed during periods of high hydrocarbon prices.
Qatar’s fiscal and external positions continue to benefit from the sharp surge in hydrocarbon prices and increasing demand for Qatari liquefied natural gas (LNG).
According to CI’s estimates, gross central government debt (including short-term treasury bills and overdrafts from banks) is expected to decline further to 56% of GDP in 2022, from a peak of 73.6% in 2020, reflecting nominal GDP growth and large primary budget surpluses.
It expects debt dynamics to remain favourable in the medium term, resulting in a further decrease in the central government debt ratio to 50.4% in 2024.
CI expects that the current account surplus will increase to 19.8% of GDP in 2022 (14.5% in 2021), and to average 12.6% in 2023-24. The central government budget surplus is also expected to triple to 12% of GDP in 2022 (4.1% in 2021), and to average 9.1% in 2023-24.
Qatar’s ratings are underpinned by very large hydrocarbon reserves (around 12.9% of global gas reserves) and associated export capacity, which in turn provide the government with substantial financial means.
Given the large hydrocarbon exports and rather small population, GDP per capita is expected to exceed $80,000 this year.
Qatar’s economic strength is deemed moderate, reflecting dependence on hydrocarbons which accounted for 37% of GDP in 2021. Economic activity has picked up since 2021 in view of the rebound in both the hydrocarbon and non-hydrocarbon sectors.
"We have upwardly revised our GDP growth forecasts for 2022 to 4.5% (previously 4%), reflecting the increase in LNG production," the rating agency said.
Moreover, non-hydrocarbon activity, particularly in the services sector, is expected to be supported by the hosting of the 2022 FIFA World Cup. The short- to medium-term growth outlook remains "favourable", with real GDP expected to grow by an average of 3.9% in 2023-24.
