Qatar’s Economic Growth Expected To ‘Broadly Steady’ This Year; Sharp Pickup Seen in 2026: NBK

Qatar’s economic growth is expected to broadly steady this year before accelerating sharply in 2026, according to National Bank of Kuwait (NBK).

In its latest ‘Economic Insight’, NBK said Qatar’s fiscal accounts are expected to show surplus and public debt to fall in 2026.

“Economic growth in Qatar is expected broadly steady in 2025 at 2.4% before accelerating sharply to 5.5% in 2026,” NBK noted.

In Qatar, the cyclical downturn following the 2022 World Cup boom has faded and growth is seen accelerating again on stronger tourism activity, new government initiatives, and increased LNG production, National Bank of Kuwait said in its ‘Economic Insight’.

Hydrocarbon GDP will play an increasingly vital role in shaping Qatar’s medium-term growth outlook (+9.8% in 2026), with the giant offshore North Field gas expansion project nearing completion, the report said.

LNG output expansion is set to generate a 63% jump in already massive capacity by 2027-2028 (to 127mn tonnes per year - mtpy) and will eventually have positive knock-on effects on non-hydrocarbon GDP, as higher resulting revenues are channelled back into the economy to meet the next wave of development goals.

Qatar’s Third National Development Strategy targets an annual average growth of 4% in 2024-2030, also helped by business efficiency, FDI-promoting and innovation-enhancing reforms.

Goals include growing labour productivity by 2% per year, attracting $100bn in cumulative FDI and developing specialised economic ‘growth’ clusters in manufacturing, logistics and tourism.

The fiscal accounts should continue to show a surplus over the forecast horizon, from 2.3% of GDP in 2025 to a wider 4.5% of GDP next year as the first LNG trains from the gas expansion project come online.

In recent years, Qatar’s budget surpluses were deployed to lower outstanding public debt, a trend that will likely continue in the medium term; public debt could fall to 34% of GDP by 2026.

According to NBK, downside risks to the outlook include a more severe than expected global economic downturn that weakens energy prices, and potentially lower prices for LNG in the event of global market excess supply.

“That said, the scale of Qatar’s imminent energy output expansion and domestic investment targets should provide some degree of resilience against international headwinds,” the bank noted.

The report also covered Oman and Bahrain and according to NBK, Bahrain’s fiscal deficits are seen widening amid lower oil prices and still-elevated interest rates, despite repeated consolidation efforts. Following sustained reform implementation, Oman’s positive economic performance is seen continuing with non-oil expansion, fiscal surpluses and a declining debt-to-GDP ratio, it said.