Reuters: US Dollar Report: UPDATE 1-Qatar economy grows 14 pct in 2011, likely to slow

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UPDATE 1-Qatar economy grows 14 pct in 2011, likely to slow Mar 28th 2012, 13:40 Wed Mar 28, 2012 9:40am EDT * Real GDP up 4.4 pct q/q in Q4 * Analysts had expected 17.5 pct growth for 2011 * Expansion to slow in 2012 * But non-hydrocarbon sector to stay strong By Martin Dokoupil DUBAI, March 28 (Reuters) - Qatar's economy expanded 14 percent in inflation-adjusted terms last year as energy exports gave it one of the highest growth rates in the world, although the pace was slower than analysts had expected, preliminary data from the Statistics Authority showed on Wednesday. Real gross domestic product of the world's top liquefied natural gas exporter grew 4.4 percent quarter-on-quarter in the final three months of 2011, and 14.7 percent on an annual basis, the data revealed. Last year's growth was below a consensus estimate of 17.5 percent given by a Reuters poll of analysts, and below the International Monetary Fund's latest estimate of 18.7 percent. A statement from the statistics authority did not explain the discrepancy. Qatar's economy relies on hydrocarbons for over half of its output, making growth rates volatile. The economy expanded 16.6 percent in 2010, according to an IMF estimate. Growth is expected to slow to 6.6 percent this year as the impact of two decades of gas output expansion fades, largely because Qatar has put a self-imposed moratorium on new hydrocarbon projects to conserve resources, according to the latest Reuters poll of analysts. But that would still be the fastest rate in the Gulf.. "We do see a slowdown in the headline rate in 2012, but the focus will switch from export volume growth - which doesn't necessarily feel like 14 percent growth - to domestic demand, so it's still a positive picture," said Liz Martins, senior regional economist at HSBC in Dubai. "Drivers of domestic demand will be increased credit growth, wage rises and strong government spending." Heavy government investment in infrastructure will sustain annual growth in the non-hydrocarbon sector of between 9 and 10 percent beyond 2012, the IMF said in January. The country of 1.7 million people, which pegs its riyal to the U.S. dollar, has outlined public investment plans worth $95 billion over five years to 2016, as it prepares to host the 2022 soccer World Cup. Qatar, which avoided the social unrest that rocked other countries in the region last year, raised basic salaries and social benefits for state civilian employees by 60 percent in September, while military staff received 50-120 percent rises. The government has yet to reveal its budget for the new fiscal year, which starts in April. Link this Share this Digg this Email Reprints

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