Qatar GDP forecast: S&P sees 15% rebound in 2027

Qatar’s economy is likely to expand 15 per cent in 2027, after contracting 14 per cent this year, S&P Global Ratings said on Friday, affirming the AA sovereign rating with a stable outlook.

The Qatar GDP forecast rests on the country bringing more gas supply back on stream. S&P expects growth to average 8 per cent a year across 2028 and 2029 once repairs to damaged liquefaction capacity and the North Field expansion feed through to exports, The National reported.

AA is the third-highest grade on S&P’s rating scale and keeps Qatar solidly in high investment-grade territory. The stable outlook assumes civilian and energy infrastructure will not suffer significant further damage, and the agency said it would review the rating if there were a sharp escalation in hostilities.

Why Qatar’s economy is contracting in 2026

Iranian attacks in March damaged two of Qatar’s 14 liquefied natural gas (LNG) export trains. With around 17 per cent of liquefaction capacity taken offline, about 12.8 million tonnes a year of LNG has been removed from the market. QatarEnergy has indicated repairs may take three to five years, and even a safe reopening of the Strait of Hormuz would restore only part of pre-war supply.

The loss of export revenue has fed directly into public finances. Emir Sheikh Tamim bin Hamad Al Thani told the Shura Council on 13 October that government revenue fell 42 per cent in the first half of 2026, while public spending was cut by 14 per cent.

S&P’s estimate of a 14 per cent contraction this year is not as severe as some recent forecasts. The IMF’s World Economic Outlook in October predicted a 15.6 per cent fall for 2026, with 18.8 per cent growth in 2027. The World Bank has forecast a steeper 20.9 per cent drop this year.

Qatar GDP forecast hinges on LNG recovery

S&P said that while some delays were expected, it still anticipates the North Field expansion will move ahead. The reconstruction of damaged LNG plants, along with Qatar’s diversification programme, should support non-hydrocarbon growth over the next two to three years, it added.

Analysts at S&P cautioned that “a prolonged shutdown or disruption to LNG production and exports” remains the main downside risk. They also pointed to Qatar’s policymaking record, significant asset buffers and the sound financial profiles of many public-sector entities as factors that give the state room to absorb volatility and fund recovery.

S&P also expects inflation to rise moderately to about 4 per cent. Fitch Ratings expressed similar views on Qatar’s resilience in its May and September 2026 assessments, The National reported.

What it means for investors

The Qatar credit rating affirmation at AA with a stable outlook sends a signal to bond and sukuk investors that the sovereign credit story remains intact even after a double-digit contraction this year. The asset buffers noted by S&P still support that view.

The Qatar GDP forecast also gives Gulf banks and corporates a timeline to work towards. QNB Group posted a 4 per cent increase in nine-month profit to QAR13.3 billion ($3.65 billion), for example, and a 15 per cent GDP rebound in 2027 would relieve pressure on credit quality and loan volumes throughout the domestic economy.

Foreign investors, who pulled a record $2.3 billion from GCC equity markets in the third quarter according to Kamco Invest, will read the S&P outlook alongside QatarEnergy’s repair schedule when deciding on exposure to Doha-listed stocks.

The Emir has announced around QAR221 billion ($60.7 billion) worth of projects and investment opportunities for the next five years in sectors including infrastructure, public-private partnerships, real estate and hospitality. The non-hydrocarbon sector contributes about 80 per cent of real GDP and is continuing to expand, the government says.

The next hard data point will be progress on LNG train repairs and the timing of the first North Field East train start-up. The latter has been pegged for the first half of 2027 by Saad Sherida Al-Kaabi, Minister of State for Energy Affairs and QatarEnergy chief executive, according to The Peninsula. Delays there would push the recovery S&P has mapped out further into the decade.