A man walks on the corniche in Doha, Qatar on June 15- Reuters photo
CAIRO – 17 August 2017: Qatar’s gross domestic product (GDP) growth this year will move at the slowest speed since 1995, a Bloomberg survey published on Thursday showed.
Cutting their forecasts, economists predicted GDP growth to stand at 2.5 percent in 2017, a half percent less than 3.1 GDP growth expected by economists in June’s survey. As for 2018, GDP growth is seen to record 3.2 percent.
Budget deficit is expected to register 5.1 percent of GDP this year, compared to 4.6 percent in 2016, economists said. Meanwhile, the inflation’s forecast declined to 2.2 percent from 2.5 percent.
Qatar’s economy has been facing hampers since Egypt, Saudi Arabia, UAE and Bahrain announced diplomatic rift with Doha on June 5, over allegations of supporting terrorism.
Economic challenges faced by the small-sized Gulf state kept growing over June and July as the sea, land and air boycott influenced investors’ appetite and currency value.
As a result of the boycott, Qatar’s net international reserves declined 30 percent in June to $24 billion, according to the Central Bank figures.
The diplomatic rift has affected Qatar’s trade disruptions, investment confidence and financial conditions, London-based think-tank Capital Economics said in an August 16 report.
The 36 percent year-on-year decline in June’s imports disrupted economic activity in Qatar as it was the sharpest drop in 13 years, senior emerging markets economist at London-based think-tank William Jackson said in the report.
“It seems likely that import disruptions will be temporary as Qatar has already started to re-route imports via Oman (rather than Dubai), and to source more food from countries such as Turkey,” Jackson noted.