Rating reflects Gulf state’s GDP per capita, one of world’s highest
Fitch Ratings has affirmed Qatar’s credit rating at “AA” with a stable outlook on expectations that public finances will strengthen on the back of higher liquefied natural gas (LNG) production capacity.
The rating also reflects the Gulf state’s GDP per capita, which is one of the highest in the world, and flexible public finance structure.
Qatar’s budget surplus is forecast to reach 3.9% of the country’s GDP this year (and 3.3% in 2026), while oil and gas revenue is anticipated to fall if the price of Brent oil will average $70 per barrel, down from $80 last year.
The debt/GDP ratio is also on track to hit 43% in 2027, down from 49% last year and 85% in 2020, as the state is expected to refinance and pay down debts.
State-owned Qatar Energy (QE) intends to ramp up its LNG production capacity from 77 million tonnes per year (mtpa) to 110 mtpa in 2026. Output is expected to increase further to 126 mtpa by the end of 2027 and 142 mtpa in 2030.
Rating Strength and Weaknesses: The ‘AA’ rating reflects one of the world’s highest GDP per capita, our expectation that additional gas production will strengthen public finances and a flexible public finance structure. Rating weaknesses include heavy hydrocarbon dependence and below average scores on some measures of governance, higher government debt/GDP than oil-dependent highly-rated peers and substantial contingent liabilities.
Fiscal Surpluses: We forecast Qatar’s general government (GG) budget surplus at 3.9% of GDP in 2025 (2024: 4.8% of GDP), including our estimates of investment income on Qatar Investment Authority (QIA) external assets (0.9% without investment income in 2025). Oil and gas revenue will drop under our assumption that the Brent oil price will average USD 70/bl in 2025 (2024: USD80/bl). We expect the budget surplus to narrow further in 2026 at 3.3% due to lower hydrocarbon prices (Brent: USD65/bl) and a moderate rise in current spending.
Fitch Ratings for Qatar accessed here.
Article source: Zawya
