The strategic measures taken by Qatar to prop up the private sector, including the real estate industry, in light of the coronavirus (COVID-19) pandemic, will help the local economy absorb potential shocks, according to Ezdan Real Estate’s monthly report.
Global rating agencies expect Qatar’s economic stability will continue and they forecast the country has outstanding potentials in trouncing these challenges successfully.
The Ezdan report noted Qatar’s real estate index strived to retain its flat momentum during the past month.
The solid performance in the real estate deals is followed by the release of a package of decisions related to the economic and financial sectors and their performance during the past period, on top of which is providing a package of financial and economic incentives worth QR75bn to the private sector, and directing Qatar Central Bank to enforce the appropriate mechanism to encourage banks to postpone loan maturities of the private sector with a grace period of six months. Qatar Development Bank (QDB) was also directed to adjourn maturities to the same period. State-owned funds are also set to increase their investments in the stock market by QR10bn, moreover, QCB shall inject a surplus of liquidity to Qatari banks.
Among the most important decisions that will bolster Qatari real estate sector is the exemption of the hospitality and tourism, retail sectors and commercial complexes from electricity and water consumption charges for a period of six months in exchange for providing services and exemptions to tenants, as well as exempting areas of logistics and SMEs for the same period.
In the implementation of these decisions, a number of organizations and entities have commenced observing the directives of the Amir H H Sheikh Tamim bin Hamad Al Thani, and decisions in several sectors, especially economic and financial ones, to ensure the continued growth of the national economy and increase its ability to face the repercussions of COVID-19 outbreak worldwide.
Economic Zones Company (Manateq) announced observing the government decisions and including exempting rents for logistic and industrial areas for a period of six months.
Qatar’s rating by major international credit rating agencies as a stable and positive is expected to stimulate the growth of the market and economic activity in various sectors, especially the real estate sector, where S&P International Rating Services affirmed Qatar’s positive outlook in the long run as stable. It also confirmed its long-term and short-term sovereign credit ratings for foreign and domestic currencies in Qatar at “AA-” and A-1”, according to Ezdan report.
Despite the plunge in world oil prices, which rendered adverse impacts on oil prices for the years 2020 and 2021, the credit rating agency still believes that Qatar’s general budget and external budget are strong at the present time, and can buffer external sudden challenges, expecting stability for the country’s credit profile, given that its ratings are supported by the state’s very strong external financial conditions, which are backed by the relatively low central government debt and the substantial external assets that Qatar has built over several years.
All indicators reflect that Qatar’s economy is seeing an upswing that began after the first quarter of 2019 with the increase in government expenditure, Ezdan report noted, citing Societe Generale’s statements that the total debt of the public government has decreased to 48 percent of annual GDP, and expected to decline to 43.1percent in 2021.
This is coupled with expectations that the expansion of the North Field gas projects will be completed by 2024, which will boost gas production.
