Qatar appears to be heading for an end of its economic euphoria as growth in its GDP is projected to dip to only around 6% in 2012 from an expected 19% in 2011 and similar high rates in previous years.

IMF figures showed that the Gulf country's real GDP, which has recorded one of the world's highest growth rates over the past decade, leaped by nearly 17% in 2010 and is forecast to pick up by about 19% in 2011.

The report expected GDP growth in the world's third largest gas power to dive to nearly 6% in 2012 but gave no reason the sharp fall apart from saying Qatar is still enforcing a moratorium on gas development projects.

Analysts attributed it to relative stability in the country's LNG supply growth following the completion of mammoth projects to boost output to 77 million tonnes per year. The country's LNG exports had grown by at least 15%% annually over the past 10 years before stabilizing at the peak 77 million tonne level at the end of 2010, when the projects were completed.

The sharp expansion in Qatar's gas industry has catapulted its economy and turned it into one of the richest nations on earth before becoming the wealthiest in terms of GDP per capita income in 2010.

Qatar's GDP shot up by nearly 26.8% in 2007 and 25.4% in 2008 before growth tumbled to only 8.7% in 2009 following a sharp drop in oil prices in the wake of the 2008 global fiscal distress. But growth in 2009 is considered high compared with that recorded in other parts of the world, where it dipped to near zero or recorded negative growth.

IMF said in its Article IV Consultation Concluding Statement of the IMF mission to the world's dominant LNG exporter that "Real GDP growth in 2011 is projected to accelerate to 19%, up from 17% in 2010. The non hydrocarbon sector is expected to grow by 9% driven by manufacturing, financial services, and trade and hotels."

The report showed hydrocarbon sector growth would peak from an increase in its production capacity of liquefied natural gas to 77 million.

Turning to finance, it said the country's overall fiscal balance remained in surplus of 2.7% of GDP in 2010-11, despite the sharp rise in current expenditure and lower than budgeted transfer of investment income from public enterprises. The current account balance is projected to record a surplus of 28% of GDP in 2011, up from 26% in 2010, reflecting increased exports of LNG and condensates and higher oil and gas prices.

(Sourced from www.emirates247.com)