Qatar

External liquidity will remain solid in the mid-term. Qatar has posted sizable current account surpluses for more than two decades, except for 2016 and 2020, when global oil and gas prices were particularly low.  As of October 2025, the current account surplus stood at USD24bn. These surpluses have enabled the Qatar Investment Authority (QIA) to grow substantially: AUM are now estimated at around USD557bn as of mid-2025. Estimates anticipate a rise to over USD900bn AUM by 2030.  The combined international reserves of the central bank and the QIA represent over two times the annual GDP and cover roughly 50-55 months of imports. Furthermore, Qatar successfully accessed international markets by issuing green bonds for the first time in 2024.This milestone coincided with the launch of the first renewable energy strategy. 

With oil and gas revenues accounting for around 85% of fiscal inflows, lower global energy prices might jeopardize tax collection. However, mid-term forecasts suggest gas prices will remain robust relative to crude, reducing urgency for revenue diversification such as a VAT. With a strong fiscal outlook, public debt decreased from 45% of GDP at the end of 2023 to 40% by the end of 2025. 
 
The economy is accelerating, with non-hydrocarbon growth gaining momentum. This is reflected in the increase of public expenditure (+5% in 2026 compared to 2025), including military spending, health, and education budgets, as well as infrastructure investment. The Public Works Authority (Ashghal) will play a key role as the projects cover many sectors and provide potential for private sector engagement. 

Qatar’s domestic political risk remains low, supported by strong state capacity, high fiscal resources and centralized decision-making. Following the November 2024 referendum, legislative elections for the Shura Council were discontinued, reinforcing an appointment-based governance model and limiting political participation. Labor market reforms introduced in 2025, such as abolishing exit permits, raising the minimum wage, and allowing job mobility, aim to improve flexibility, while the new Qatarisation law introduced in April 2025 mandates prioritizing Qatari nationals in employment (excluding energy firms). These measures may create mixed outcomes, balancing social objectives with private-sector competitiveness.

Externally, Qatar maintains an elevated political profile through strategic partnerships and active diplomacy. Relations with GCC neighbors have normalized since the 2017 rift, while ties with the US remain strong, reinforced by security cooperation and LNG trade. In 2025, its role as diplomatic hub between Israel and Hamas brought the war to Qatari soil, demonstrating how risks remain in the region. Qatar also leverages its role as a key LNG supplier to East Asia and invests in regional infrastructure projects, such as Iraq’s Development Road and GCC rail links, to diversify trade routes and mitigate reliance on the Strait of Hormuz.

Key risks stem from regional instability, potential disruptions to maritime routes and climate-related challenges. Additionally, regulatory frictions, particularly around sustainability and compliance, could affect cross-border business. Overall, Qatar’s political environment offers stability and global engagement, but exposure to geopolitical tensions and structural governance limits remain notable risk factors.