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Mon 11 May 2009 07:32 AM

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Qatar inflation seen falling to 7% in 2010 - report

Merrill Lynch says Qatar will continue to be one of world's fastest growing economies.

Inflation in Qatar may come down to seven percent in 2010, the Bank of America – Merrill Lynch has said in a new report.

It estimates that inflation in Qatar is likely to remain at about 10 percent this year, down significantly from the 15 percent recorded in 2008.

“Qatar will remain one of the fastest growing economies despite lower oil prices. We estimate the Qatari economy to grow at five percent this year,” according to the report, published in Gulf Times on Monday.

While the global economic slowdown will have an impact on Qatar, the country will continue to grow, the report said.

Qatar’s growth will primarily be driven by its LNG resources, the report said.

Qatar is now the world’s largest exporter and trans-shipper of LNG. Currently, nine LNG trains are in operation – five at RasGas and four at Qatargas. They account for about 39mn tonnes per year.

In another report, the Bank of America - Merrill Lynch said the Qatar government’s commitment to infrastructure spend was likely to cushion an economic slowdown and sustain medium term growth.

But it said the tightening credit and dwindling external surpluses could force Qatar to rethink capex intensive projects.