Discusses key economic indicators and trade statistics, which countries are dominant in the market, and other issues that affect trade.
The United States and Qatar enjoy a strong commercial, political, and security relationship. With just 300,000 citizens, Qatar enjoys among the highest gross domestic product (GDP) per capita in the world and looks to overseas partners to achieve strategic goals, as outlined in its National Vision 2030, creating opportunities for U.S. businesses in multiple sectors.
According to the World Bank, by the end of 2021, Qatar’s annual gross domestic product (GDP) rebounded to 1.5% growth – a strong turnaround from its 2.5% contraction in 2020. In May 2022, the International Monetary Fund (IMF) forecasted Qatar’s 2022 projected real GDP growth would be 3.4%. Near-term growth is boosted by the FIFA Men’s World Cup in November-December 2022 and favorable hydrocarbon prices with increased demand. Qatar Energy’s ongoing North Field Liquefied Natural Gas (LNG) Expansion project, expected to be operational in 2026-2027, will further support economic growth in the medium-term. The IMF forecasts strong fiscal surpluses in the coming years, even before the North Field expansion project comes fully online, averaging 5.9% of GDP. Qatar is recovering steadily from the toll COVID-19 had on businesses, banking, and the overall economy. The government’s thorough reaction to the pandemic helped to minimize its negative impacts on the economy and foreign investment and facilitated the country’s recovery. The World Bank estimates Qatar’s annual GDP was $179.6 billion in 2021.
Both total U.S. exports to Qatar and the U.S. trade surplus with Qatar have declined steeply since 2019, with U.S. exports to Qatar going from an all-time high of $6.45 billion in 2019 to $2.58 billion in 2021. Year-to-date U.S. Census Bureau trade data in June 2022 shows a $42 million U.S. trade deficit with Qatar, the first bilateral trade deficit since 2002, due both to reduced U.S. exports to Qatar and increased U.S. imports from Qatar. Even with the sharp decrease in U.S. exports to Qatar during the Covid-19 pandemic, U.S. companies have played an important role in the recovery of the market, particularly in the energy, defense, technology, and engineering sectors, among others, and recent significant announcements indicate U.S. exports should rebound in 2023-24.
Qatar remains an important investment partner for the United States. Its sovereign wealth fund, the Qatar Investment Authority (QIA), is heavily invested in the United States and focused on new investment opportunities. Since 2015, Qatar has invested significantly in U.S. real estate and asset-heavy retail. QIA is seeking to diversify its U.S. investments by expanding to the technology and healthcare sectors and has committed to invest more than $45 billion in American infrastructure.
Qatar has taken steps in recent years to further attract foreign direct investment (FDI) and innovation by passing a foreign investment law that allows foreign firms to have up to 100% ownership in most economic sectors and a Public-Private Partnership (PPP) Law to promote economic diversification and create greater opportunities for U.S. companies in the education, environmental technologies, and healthcare sectors, consistent with fulfilling Qatar’s National Vision 2030.
Qatar announced a National Climate Change strategy in October 2021, shortly after state-owned Qatar Petroleum (QP) rebranded as Qatar Energy (QE). The name change to QE directly supports Qatar’s focus on LNG as a cleaner energy alternative that can serve as a transition energy source while the world adopts more renewable energy sources. QE is deepening its investments in LNG with its $30 billion North Field LNG expansion project. This project includes the initial development of six LNG mega trains, creating significant opportunities for U.S. energy companies. In addition, QE invested $18 billion in the U.S. energy sector in the Golden Pass Terminal ($10 billion) in Texas and a petrochemical plant on the Texas Gulf Coast ($8 billion). QE oversees the oil, gas, fertilizer, petrochemicals, and refining operations in the country and has multi-billion interests abroad. As a global leader in LNG extraction, QE is an important player both in Qatar and globally.
The U.S. Commercial Service in Doha continues to monitor government changes to counsel U.S. businesses with the most current regulatory information available.