DOHA: Qatar will base its extended 2014-15 budget for nine months starting April on an assumed oil price of $65 per barrel and is expected to allocate a large portion of its spending in this budget on FIFA 2022-linked development projects.
An over QR100bn($27.5bn)budget surplus the country has achieved until last January seems to have inspired its planners to base the interim budget on a crude price of $65.
Talking to the media on the sidelines of an Institute of International Finance (IIF) conference, the Minister of Finance, H E Ali Sherif Al Emadi (pictured) said that the oil market last year had the price above the $65 per barrel level, creating a surplus in the state budget. He added that there was a surplus in excess of QR100bn. The Finance Ministry will release a statement detailing the implementation of the extension of the current budget to the end of 2015 so that all ministries and government authorities will get a clear idea about the extended budget. The statement will also detail the spending on projects, the Minister added. Much of the allocations for spending in the interim budget (April to December 2015) will be on FIFA 2022-related development projects, he said.
According to the Minister, the Emir, H H Sheikh Tamim bin Hamad Al Thani recently passed a law declaring the interim budget. From 2016, according to the law, the state’s financial year will be switched to follow the Gregorian calendar (January to December).
Earlier, delivering the keynote address at IIF conference the Minister said that GCC countries have been building their financial reserves in the previous years, when the prices of oil saw a strong uptrend, in anticipation of a possible decline in energy prices.
These reserves stand now at more than $2trn and can maintain sustainable development plans and cover any potential deficit that faces the region’s countries.
The drop in oil prices led to pessimism over the economic conditions of GCC countries. These countries have strived to diversify their economies in recent years. The Minister highlighted how Qatar focused, when oil prices were above $100, on allocating funds for the country’s developmental projects for the next 10 years. Al Emadi added that the government is currently investing in education and scientific research. The minister noted that the non-oil sector now represents 51 percent of Qatar’s GDP.
The Minister said the global energy sector is undergoing restructuring due to several factors, most notably increasing production from unconventional sources. This will lead to radical changes in production, export and consumption patterns of oil and gas market in the world.
The Peninsula
