Qatar expects to post a deficit of 46.5 billion riyals ($12.8 billion) in 2016, according to its budget announced on Wednesday, its first in 15 years and a sign of the toll cheap oil prices are taking on Gulf economies.
The budget is the first to be presented by a Gulf state for 2016 at a time when the finances of the wealthy oil-exporting region are being scrutinised by markets and investors for signs of strain due to a sustained slump in oil prices.
Qatar's budget has been especially eagerly anticipated, as it is the country's first in almost two years, following a shift of its fiscal year to Dec. 31 from Mar. 31 last March to align with private sector practice.
Qatar has budgeted for revenues of 156 billion riyals and expenditures of 202.5 billion riyals in 2016. This compares with 226 billion riyals and 218.4 billion riyals respectively in the previous budget.
The shortfall is expected to be covered by local and international debt issues, according to the budget statement carried by the state news agency QNA.
Finance minister Ali Sherif al-Emadi told QNA the budget would sustain spending in key sectors like health, education, infrastructure and transport, with special focus on railways and other projects tied to Qatar's hosting of the 2022 World Cup.
Health, education and infrastructure accounted for the largest share of the 2016 budget, at 91.9 billion riyals, or 45.4 percent of the total.
Major infrastructure expenditures, which totalled 50.6 billion riyals alone, would include railways, the new Doha port, several large roadways and the expansion of electricity, water and sewage networks.
Earlier in the day, Qatar halved its forecasts for economic growth in 2015, down to 3.7 percent from the 7.3 percent forecast in June, citing the impact of lower oil prices.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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