‘Stronger-Than-Expected’ Growth for Non-Oil Sectors in H2 2024

Doha, Qatar: Qatar’s non-oil activities are expected to outperform all industries with notable growth from 2 percent to 2.2 percent this year, according to a report by Fitch Solutions.

The researchers indicate that numerous industries are poised for “stronger-than-expected” growth in the remaining months of 2024, augmenting Qatar’s resilient economy.

Qatar’s GDP figures recently, showing a growth of 1.2 percent y-o-y during the third quarter of 2023. Among the many sectors contributing to the economy, hydrocarbon witnessed a boost of 2.3 percent y-o-y. 

In comparison, the non-oil economy grew by 0.6 percent y-o-y during Q3 2022, the Planning and Statistics Authority revealed.

The market experts at Fitch signify that albeit the growth in the hydrocarbon sector was according to their expectations, the third quarter of 2023 headline growth surprised the upside due to stronger-than-expected non-oil activity.

Analysts stressed that this comes amidst Qatar hosting the mega sporting event in 2022 that saw potent activity in the industry during the latter half of the year, in preparation for the tournament. Eventually, Fitch Solutions noted its estimation for the growth in 2023 from 1 percent to 1.4 percent and hence forecasted a vital growth of 2 percent to 2.2 percent in 2024.

Experts at Fitch Solutions stated: “We have long argued that Qatar’s economic growth will accelerate in 2024 as lower inflation, stronger tourism activity and investment in construction and infrastructure projects causes the non-oil sector to recover. Supporting our view, high-frequency data for Q1 2024 such as Purchasing Manager’s Indices, new building permits, and tourist arrivals all point to stronger non-oil activity so far in 2024.”

To point out, January and February’s data this year ascertains that the total arrivals have increased by 78 percent y-o-y, due to the hosting of two main events in the country - the Asian Football Cup and the World Aquatics Championships.

The report further adds that the inflation in Qatar eased from an average of 4.2 percent y-o-y during the first three months of 2023 to 2.2 percent y-o-y in the first quarter of 2024, delivering a “tailwind” for residential expenditures.