Washington, DC: An International
Monetary Fund (IMF) staff team, led by Ms. Ran Bi, visited Doha during
November 1–14, 2023 to conduct discussions for the 2023 Article IV
consultation. The mission will submit a report to IMF management and
Executive Board, which is scheduled to discuss the Article IV Consultation
in January 2024.
At the conclusion of the visit, Ms. Bi issued the following statement:
“After very strong performance in 2022, economic growth has been
normalizing while the medium-term outlook remains favorable. Output is
expected to expand by about 1¾ percent per annum during 2023–25 with the
non-hydrocarbon sector growing at 2¾ percent driven by domestic demand,
including from the construction of the North Field expansion project, and
robust tourism, boosted by the global visibility brought by the 2022 FIFA
World Cup. Medium-term growth is set to increase to around 5 percent per
annum supported by LNG production expansion and as reform efforts to
achieve National Vision 2030 guided by the Third National Development
Strategy (NDS3) start to bear fruit. Inflation will likely moderate to 2
percent, and the fiscal and current accounts are projected to remain in
surpluses over the medium term. Risks to the outlook are broadly balanced.
“Broad fiscal discipline amid sizeable hydrocarbon windfalls in 2022–23 has
strengthened fiscal position significantly and is commendable. Continued
fiscal prudence is expected under the upcoming 2024 budget. The next
medium-term budget, covering 5 years for the first time, is being developed
to support NDS3 initiatives and should balance aspiration for
transformation and fiscal prudence. The ongoing effort to enhance
efficiency, including through the implementation of program-based
budgeting, and to increase transparency is welcome. Medium-term priorities
include accelerating revenue diversification through further mobilization
of non-hydrocarbon tax revenues, enhancing spending efficiency, and
reorienting public investment to facilitate private sector growth, which
can be supported by a well-functioning medium-term fiscal framework and
greater fiscal transparency.
“The Qatar Central Bank (QCB) has maintained price and financial stability.
Inflation has moderated following monetary policy tightening in tandem with
the U.S. Federal Reserve, consistent with the currency peg to the U.S.
dollar. Banks remain healthy, although the non-performing loan ratio has
edged up as pandemic-related restructured loans have turned non-performing,
output growth has normalized after the World Cup, and financial conditions
have tightened. Banks’ relatively high provisioning mitigates the risks.
The QCB has refined macroprudential measures to further reduce risks
associated with banks’ external asset-liability mismatches, especially
those of short maturities, which is welcome. Continued diligence is
critical to enhance banking sector resilience, complemented by reforms to
further deepen domestic financial markets, as envisaged in the upcoming
financial sector strategy.
“Qatar is at an important juncture in shifting its growth model from one
that is led by the state to a more dynamic and market-oriented one driven
by the private sector. Building on the progress made so far, and guided by
upcoming NDS3, reforms should focus on enhancing human capital, labor
market dynamism, and business environment. Furthering digitalization with
due attention to potential risks, and strengthening climate resilience and
green transition are also key for achieving National Vision 2030.
“The staff team expresses its appreciation to the authorities for the
productive discussions and for the arrangements to facilitate the visit.
The team met with Minister of Finance H.E. Ali bin Ahmed Al Kuwari,
Governor of the Qatar Central Bank H.E. Sheikh Bandar Bin Mohammed Bin
Saoud Al-Thani, other senior government officials, and private sector
representatives.”
