By Andy Sambidge
New Business Optimism Index says SMEs continue to be highly optimistic about prospects
The outlook for Qatar's economy remains overwhelmingly positive, despite sluggish and uneven global growth, according to the Business Optimism Index (BOI) released by Dun and Bradstreet.
It said the Qatari business community, particularly small and medium-sized enterprises (SMEs), continue to remain highly optimistic moving into the fourth quarter of 2014.
The composite BOI for Qatar's non-hydrocarbon sector rose to 49, a 26 percent quarter-on-quarter increase, led by the construction sector which was driven by a large number of new projects and tenders.
Additional optimism has been prompted by a growing clientele base, expansion plans, sales figures, and profitability, the report said.
More than two-thirds of those surveyed said they expect an increase in sales volumes while 68 percent anticipate an increase on new orders. Expansion plans also remain generally robust, with 35 percent - a marginal decrease from last quarter - expressing intent to expand current business.
Commenting on the results, Yousuf Al-Jaida, deputy CEO of the QFC Authority which sponsors the index, said: "This quarter's survey further demonstrates Qatar's positive business environment. Optimism among our business community remains high."
He added: "We expect to see this translated into increased interest in Qatar from international firms as well as a continued increase in Qatari entities establishing companies in the QFC."
Construction is currently viewed as the most optimistic sector for Q4. Globally, a growing confidence is fuelled in part by increased urbanisation, consumer spending, and credit availability, while both the Qatar National Vision 2030 and preparations for the 2022 FIFA World Cup are driving enthusiasm nationally.
The Q4 BOI for the construction sector rose to 53, up 11 points from 42 in Q3, with government spending, steadily increasing population, high per capita income, GDP growth, and prudent policy preferences contributing towards the positive outlook.
The survey also indicated additional overall optimism in the finance, real estate and business services sectors, due to promising expectations for sales volumes, selling prices, new orders, profits, and number of employees.
Overall, SMEs are more optimistic about the Qatari business environment than the large local companies.
Sheikh Mohammed bin Faisal bin Qassim Al-Thani, board member of the Qatar Businessmen Association, said: "The final BOI report for this year shows that optimism prevails in Qatar, with a majority of businesses confident of embarking upon new projects as the country continues its bold and progressive journey towards the realisation of our National Vision.
"As the latest trends clearly indicate, we are on the right path, and I sincerely hope that this pattern will continue in the coming quarters."