The price of this business forecast report covers 4 quarterly reports on this country. This quarterly report will be downloadable instantly as a PDF document, with the 3 remaining reports delivered at regular intervals throughout the year.

Qatar's short-term political risk profile remains among the most stable in the region. Despite enjoying little in the way of democratic freedom, Qataris benefit from massive hydrocarbon wealth, spread generously across the country's native population, and enjoy the highest per capita GDP in the world. A small population – and one without much inclination to protest against the government – will keep the country insulated from large-scale public unrest in the immediate term.

Qatar is likely to continue its efforts at enhancing its international investment position over the coming years. We are forecasting a current account surplus of 31.8% of GDP in 2012 and, in spite of our expectation of moderating global energy prices, forecast an average surplus of 28.7% of GDP in the period 2012-2015, facilitating further outflows of capital from the small Gulf state.

Major Forecast Changes

While Qatar's broader growth outlook remains largely unchanged since our last report, a recently announced government spending package has led us to make minor revisions to our GDP forecasts for 2012 and 2013. We now expect real GDP to grow by 7.9% in 2012, compared with our previous forecast of 7.8%, while escalating inflationary pressures – which will dull the impact of public-sector wage hikes – have caused us to revise down our real GDP growth forecast for 2013 from 6.6% to 5.8%.

Owing to larger-than-expected wage increases - coupled with latest data from the Qatar Statistics Agency, which points to escalating upward pressure on consumer prices – we have revised up our medium-term inflation projections. We now pencil in average inflation of 1.9% and 3.8% in 2011 and 2012 respectively, compared with our previous forecasts of 1.5% and 3.0%.

Key Risk To Outlook

Given the economy's heavy reliance on the hydrocarbon sector, a pronounced global economic downturn – if it were to translate into a sustained drop-off in demand for oil and gas – could impact negatively on our forecasts for Qatar's external account position, budget and growth outlook. That said, we highlight that the country's US$60bn sovereign wealth fund – as well as its continuing ability to tap international debt markets – provides the economy with significant bulwarks against these risks.

Doha's increasingly assertive foreign policy raises some risks in relation to the outlook for regional political stability. In particular, we highlight the potential for the country's foreign policy to provoke a backlash in the region and the danger that the government could become bogged down in a drawn-out conflict in the Middle East.

Click for Report details:Qatar Business Forecast Report Q2 2012