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Satyendra Pathak
Doha
Qatar’s economy showed a resilient performance in the middle of weakening global economy in 2018, Qatar Central Bank (QCB) has said in its latest report.
In its 42nd Annual Report for 2018, the QCB said stable oil prices and continued strong exports will lead to acceleration in Qatar’s economic growth over the next two years.
While the nominal GDP growth accelerated from the previous year on the back of global energy prices remaining at an elevated level during 2018, Qatar’s economic outlook for 2019 remains positive.
“Moreover, overall recovery in energy prices led to further increase in exports and current account surplus. Also, despite the increase in government expenditure, fiscal balance was in surplus as against a deficit in the previous year,” the report said.
As a part of fiscal reforms to enhance efficiency, it said expenditure prioritisation towards infrastructure spending was pursued to achieve the goals of sustainable development envisaged in Qatar National Vision 2030.
During 2018, the QCB pursued its mandated monetary policy objective of maintaining a pegged currency while ensuring a stable systemic liquidity.
In response to the policy rates hikes by the US Federal Reserve, the report said, QCB also raised deposit rate four times during 2018 after taking into account the domestic economic conditions.
“At the same time, measures were taken to ensure a comfortable systemic liquidity so as to facilitate adequate credit flows to productive sectors. The payment and settlement systems in Qatar grew in comparison to the previous year, both in value and in volume terms,” the report said.
The central bank said foreign capital inflows have returned and banking liquidity has improved, while its official reserves returned to pre-embargo level.
Use of electronic payment system increased for both retail and wholesale payment in both volume and value terms, while use of cheques declined.
Several regulatory measures were taken by QCB during the year towards making the system safer and secure for both the banks as well as the consumers of the banking sector, the report said.
Citing data from the Planning and Statistics Authority, the central bank said real gross domestic product was likely to grow at an average rate of 2.8 percent between 2018 and 2020 as Qatar’s economy has withstood a diplomatic and economic blockade imposed by Gulf neighbours.
“Inflationary situation was benign due to supply related domestic factors, coupled with stronger currency against trading partners and soft global commodity prices in the later part of 2018,” it said.
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16/08/2019
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