Qatar won’t cut subsidies or project spending, says finance minister

Qatar won’t remove energy and food subsidies or cut back on project spending amid lower oil and natural gas prices, Reuters reported, citing the country’s finance minister Ali Sherif Al-Emadi.

The Gulf country’s financial position remains strong, Al-Emadi said, enabling it to push ahead with its plans to develop infrastructure projects worth $200 billion over the next decade, many of which are related to its hosting of the 2022 FIFA World Cup event.

Construction industry sources say some projects have been delayed or suspended in the past year, partly to avoid waste and ensure quality, the news agency added.

The state’s finances would break even with an average oil price of $65 per barrel (bbl), he added. Brent crude is currently around $49/bbl.

Qatar, the world’s biggest exporter of liquefied natural gas (LNG), is projected to run a budget deficit of 0.7 percent of gross domestic product (GDP) this year, which would be the smallest in the Gulf region, according to a recent poll by Reuters.

El-Emadi’s comments come after the United Arab Emirates (UAE) last month deregulated its fuel subsidies to help its economy cope with lower oil prices. Local media reports published this week suggest that Saudi Arabia may do the same. Bahrain has also taken steps in recent months to reduce or remove subsidies on some food items.