Q2 sees 14.5% expansion in Qatar construction
Real GDP growth accelerated to 5.7% in Q2
A 14.5% year-on-year expansion in local construction activity was seen in the second quarter of this year on the back of major infrastructure projects in Qatar, according to a QNB economic report.
These include the new metro in Doha, major real estate projects such as Msheireb and Lusail, as well as new roads, highways and the further expansion of the new Hamad International Airport, QNB said.
In addition, transportation and communication increased by 11.8% year-on-year, mainly down to increased passenger flows through the new airport.
"The non-hydrocarbon sector in Qatar continues to drive economic growth, supporting the diversification of the economy," QNB said.
Real GDP growth accelerated to 5.7% in Q2, 2014, from a revised 5.4% in the previous quarter, the QNB report said citing recent figures released by the Ministry of Development Planning and Statistics (MDPS).
"The latest growth figures confirm Qatar's ongoing rapid process of economic diversification away from its traditional role as a hydrocarbon exporter towards a manufacturing and services hub," QNB said.
A moratorium on new projects at Qatar's largest gas field, the North Field, means that "increases in gas production are likely to be limited".
In the future, the only gas project expected to add to growth is Barzan, which is only for domestic supply and should add incremental growth to hydrocarbon GDP annually during 2015-23.
The latest GDP numbers are in line with the country's overall development plan outlined in the Qatar National Vision 2030 and the National Development Strategy 2011-16, which aim to diversify the economy away from its dependence on hydrocarbons to achieve more sustainable growth and create jobs.
"By investing heavily in major non-hydrocarbon projects the authorities are attracting a new wave of expatriate workers to Qatar. This increased level of population growth should boost aggregate domestic consumption and add to non-hydrocarbon GDP growth going forward.
"As a result, the non-hydrocarbon sector accounted for 49% of GDP in Q2 2014, compared with 46% a year earlier."
Looking ahead, QNB predicted that with strong growth, moderate inflation and high current account surpluses, Qatar's economic momentum was expected to accelerate further.
"Large-scale infrastructure spending and population growth is expected to drive the expansion in construction, manufacturing and transportation.
"Strong population growth is also likely to lead to higher aggregate demand for housing, financial, retail and social services. Overall, this growth momentum is leading to a more diversified economy and one of the fastest growing non-hydrocarbon sectors in the world."