In 2025, Qatar is projected to lead the Gulf Cooperation Council (GCC) in real oil Gross Domestic Product (GDP) growth, with an anticipated increase of 1.4%, according to the International Monetary Fund (IMF). This forecast comes amid expected contractions in oil GDP for several other GCC nations.
GCC Oil GDP Projections
The Gulf Cooperation Council (GCC) countries are poised for notable economic growth in the coming years, with projections indicating a significant acceleration in 2025. This anticipated upturn is largely attributed to expected increases in oil production and ongoing diversification efforts across the region.
The IMF’s data indicates that while Qatar is poised for growth, other GCC countries may face declines in their oil GDP for 2025:
- Saudi Arabia: Projected to experience a 5% decrease in oil GDP.
- Kuwait: Expected to see a 6.6% decline.
- Oman: Anticipated to have a 3.4% reduction.
- Bahrain: Forecasted to face a 1% decrease.
In contrast, the United Arab Emirates (UAE) is expected to see a modest growth of 0.3% in its oil GDP.
Future Outlook: Qatar’s Economic Growth and Vision for 2030
Qatar’s future economic outlook remains promising, driven by strong investments in energy, diversification efforts, and strategic reforms under the Qatar National Vision 2030. With a projected average GDP growth rate of 4.1% between 2025 and 2029, the country is set to experience significant expansion, fueled primarily by its liquefied natural gas (LNG) sector and non-oil industries.
Looking ahead to 2025, the IMF projects a recovery in oil GDP across the GCC:
- UAE: Anticipated to lead with a 6.7% growth in oil GDP.
- Saudi Arabia: Expected to achieve a 5% increase.
- Kuwait: Projected to see a 4% rise.
These forecasts suggest a rebound in the region’s oil sector after the anticipated downturn in 2024.
Non-Oil GDP Growth
The GCC’s non-oil sectors are also expected to show resilience and growth. The IMF forecasts a 3.7% increase in non-oil GDP for the region in 2024, with an upward revision of 10 basis points, followed by a 4% growth in 2025. This positive outlook is attributed to ongoing economic diversification and reform initiatives within the GCC countries.
The UAE is projected to lead in non-oil GDP growth with a 5.3% increase in 2024, followed by Bahrain at 3.8% and Saudi Arabia at 3.7%. These figures underscore the effectiveness of efforts to diversify economies beyond the oil sector.
Inflation Trends
Inflation within the GCC remains relatively low. It is expected to decrease gradually from 6.7% in 2023 to 5.8% in 2024, and further to 4.3% in 2025. This decline is supported by lower oil prices and a faster-than-expected decrease in global food commodity prices.
Notably, most GCC countries are experiencing inflation rates near or below 2%, contrasting with the wider Middle East and North Africa (MENA) region, where inflation is expected to remain in double digits until 2025.
Impact of Regional Conflicts
Ongoing conflicts in regions such as Gaza and Lebanon have heightened uncertainty, disrupted trade routes, and displaced populations. For instance, container shipping through the Suez Canal has decreased by over 70% from pre-conflict levels, as many trade routes have been redirected around the Cape of Good Hope.
Qatar’s economic outlook for the coming years is optimistic, with significant growth anticipated as the nation advances toward its Qatar National Vision 2030. According to HE the Minister of Finance, Ali bin Ahmed al-Kuwari, Qatar’s Gross Domestic Product (GDP) is projected to grow at an average annual rate of 4.1% between 2025 and 2029. This positive trajectory is largely attributed to the substantial expansion of Qatar’s Liquefied Natural Gas (LNG) production capacity.
Projected GDP Growth Rates:
The Gulf Cooperation Council (GCC) countries are projected to experience notable economic growth in the coming years, driven by both oil and non-oil sectors. Below is a summary of the projected Gross Domestic Product (GDP) growth rates for the GCC region and individual member countries:
- 2025: 2.4%
- 2026: 5.2%
- 2027: 7.9%
- 2028: 3.5%
- 2029: 1.6%
These projections reflect a peak in growth around 2027, followed by a gradual stabilization.
The International Monetary Fund (IMF) supports this favorable outlook, noting that Qatar’s medium-term growth is expected to average about 4.75%. This growth is anticipated to be driven by public investment, benefits from the ongoing LNG expansion project, and a robust tourism sector.
The Third National Development Strategy (NDS3), launched in January 2024, plays a pivotal role in this economic transformation. NDS3 aims to accelerate progress toward the Qatar National Vision 2030 by focusing on economic diversification and reducing dependence on the hydrocarbon sector. Key objectives include leveraging the private sector for services and growth, achieving top global rankings in business environment and digital competitiveness, and fostering innovation.
In summary, Qatar’s economy is on a promising path, with substantial growth expected as the nation implements strategic initiatives to diversify its economic base and enhance its global competitiveness.
Conclusion
Qatar’s anticipated leadership in real oil GDP growth within the GCC for 2024 highlights its economic resilience amid regional challenges. The broader GCC region’s focus on economic diversification and reform appears to be yielding positive results, particularly in non-oil sectors. However, external factors such as regional conflicts and global economic conditions will continue to influence these projections.
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