Qatar surplus surges on energy revenues

Qatar's state budget turned a hefty surplus of 25.6 percent of quarterly economic output in the second quarter of its 2011/12 fiscal year as revenues jumped, data showed on Tuesday.

The world's top exporter of liquefied natural gas booked a surplus of QR42.2bn ($11.6bn) in July-September 2011, reversing a deficit of QR2.2bn, or 1.4 percent of gross domestic product, in the previous three months, preliminary estimates published by the central bank showed.

Revenue jumped 61 percent to nearly QR78bn in July-September from a year earlier, helped by rising oil prices and expanded gas production, bringing cumulative income for the first two fiscal quarters to 68 percent of the 2011/12 target, according to a Reuters calculation.

Government expenditures were up by nearly 24 percent in the period from a year ago at QR35.8bn and met 50 percent of the full-year target on a cumulative basis, the data showed.

A Reuters poll in December forecast the Gulf Arab country would post a surplus of 8.6 percent of GDP for the full fiscal year ending in March, compared with a surplus of 2.9 percent of GDP in 2010/11.

Qatar's economy is expected to slow this year from double-digit growth but the government plans to increase spending by 19 percent to at least a six-year high in the current fiscal year, helped by a recent expansion of its gas industry and robust oil prices.

In its 2011/12 budget, the cash-rich country pencilled in spending worth QR139.9bn and a surplus of QR22.5bn, or 4.9 percent of GDP.

But that was before Qatar, which has avoided social unrest rocking the Middle East, raised basic salaries and social benefits for state civilian employees by 60 percent in September, while military staff received 50-120 percent rises.

The measures will add an estimated $1.6bn to government expenditure in 2011/12, the International Monetary Fund said in January following annual consultations.

Qatar, which plans to boost infrastructure spending ahead of hosting the 2022 soccer World Cup, assumed an oil price of $55 per barrel in its 2011/12 budget.

It has largely overspent its budget plan in the previous three fiscal years. Its income has also overshot targets due to conservative oil price estimates.

The government outlined public investment worth QR347bn during the five years to 2016 in its development strategy unveiled last March, with more than $65bn of that expected to be on infrastructure.

Despite the huge investments planned, Qatar is expected to keep posting budget surpluses in the coming years, its central bank governor said in September.

Brent crude prices have been hovering between $100 and $127 per barrel since the 2011/12 fiscal year started in April, providing a comfortable buffer for the budget plans.