Qatar to expect spike in growth as LNG expansion goes online in 2025

Doha, Qatar: Standard Chartered ( the Bank ) expects growth in Qatar to spike above trend when the planned liquefied natural gas (LNG) capacity expans...

Doha, Qatar: Standard Chartered (“the Bank”) expects growth in Qatar to spike above trend when the planned liquefied natural gas (LNG) capacity expansion begins to go online in 2025.

According to the Bank’s Global Focus Economic Outlook Q2-2024, which covers the outlook for 58 economies, key geopolitical issues and financial market implications this year and beyond, the Bank forecasts a ‘calm before the upsized gas boom’ in Qatar and predicts the post-FIFA slowdown to change pace next year.

The Gulf state now aims to increase output at the North Field by 85% versus 64% previously, which would take natural gas output to 126 million tonnes per annum (mtpa) by end-2027 and 142mtpa by end-2030, from 77mtpa currently.

Qatar’s investment in the recently upsized gas capacity expansion is likely to support private-sector activity. The research notes private-sector credit growth was c.6% y/y in January, exceeding GDP growth, which dipped to 1.0% y/y in Q2-2023 from 8.0% in Q4-2022.

The planned expansion of LNG output and subsequent boost to GDP is also expected to rein in public debt to c.30% by 2027. Prior to that, the report estimates that public debt will decline to 37.5% of GDP by end-2024 and 35% by end-2025, from a peak of 73% in 2020 – assuming Qatar continues to use its surpluses to pay down external debt (external debt maturities are USD 4.8bn in 2024 and USD 2bn in 2025).