The recent visit by an International Monetary Fund (IMF) team to Doha, on 17-18 September, has reaffirmed Qatar’s economic resilience and its steady progress toward diversification. Led by Mr Nathan Porter, the mission concluded with a broadly positive outlook, underpinned by sound macroeconomic management, robust financial buffers, and a clear commitment to reform. The government’s ambitious Third National Development Strategy (NDS3) is advancing with purpose, and the planned expansion of Liquefied Natural Gas (LNG) production in the North Field will further consolidate Qatar’s position as a key global energy supplier.
These developments are encouraging. They reflect a growing recognition among energy producers that long-term prosperity depends on more than hydrocarbons. It requires strategic investment, economic diversification, and a willingness to embrace innovation and sustainability.
Qatar’s approach is pragmatic and forward-looking. The government is actively promoting competitiveness, productivity, and climate sustainability. Non-hydrocarbon growth is accelerating, tourism is expanding, and inflation remains moderate. The financial sector is stable, well capitalised, and increasingly resilient to external shocks. These are important indicators of confidence and capability.
Growth and inflation dynamics
The IMF’s assessment points to a favourable trajectory. Growth recovered to 2.4% in 2024, driven by faster non-hydrocarbon expansion at 3.4%. Tourism has emerged as a bright spot, with visitor arrivals rising nearly 30% and hotel occupancy remaining high. Robust non-hydrocarbon growth of more than 4% is expected in 2025, consistent with strong performance in the first half of the year and positive PMI readings. Over the medium term, growth is projected to average 4%, reflecting the North Field expansion and continued implementation of NDS3.
Qatar is on a stable and promising path. Its economic fundamentals are strong, its reform agenda is advancing, and its financial buffers remain robust
Inflation remains contained despite robust economic activity. Headline inflation stood at 1.3% in 2024 and remained negligible in the first half of 2025, with subdued increases in the costs of food, housing, and hospitality. Core inflation decreased steadily from 2.5% in 2024 to 1.3% during the same period. The Qatar Central Bank continues to align its policy rates closely with those of the US Federal Reserve. While base effects are expected to raise inflation above 2.5% in 2026, it is projected to stabilise around 2% over the medium term.
External and fiscal stability
External and fiscal balances are expected to remain in surplus. The current account posted a surplus exceeding 17% of GDP in 2024, supported by strong service sector performance and current transfers, which offset a worsening trade balance. The surplus remained solid in the first quarter of 2025 at 15.6% of GDP, and the central bank is steadily accumulating foreign reserves, which stood at $55bn in August, equivalent to 8.1 months of imports. The direct effect of US tariffs is projected to be minimal, given the exemption of hydrocarbon exports.
Fiscal performance has been broadly stable. Reduced hydrocarbon revenues brought the overall fiscal surplus down to 0.7% of GDP in 2024, although the non-hydrocarbon primary balance increased by 2.4 percentage points. Central government debt declined to nearly 40% of GDP, and the 2025 budget plans for spending levels comparable to the previous year. Steady fiscal consolidation, over the medium term, would support maintaining a non-hydrocarbon primary balance in line with intergenerational equity. With prudent fiscal management, surpluses in both the current account and fiscal balance are expected to endure.
Banking sector resilience
The banking sector remains a source of strength. Banks continue to demonstrate strong capitalisation, liquidity, and profitability. The non-performing loan ratio decreased slightly to 3.6% in June, and while there is variability in loan quality across the system, banks are well provisioned. Recent stress tests conducted by the central bank indicate that banks hold sufficient buffers to absorb potential shocks. Dependence on external funding remains a risk, but this is being mitigated by banks' shift towards longer-term, more stable domestic funding. The North Field LNG expansion and associated economic activity are expected to boost credit demand in the next few years.
Labour market and business reforms
Beyond the headline figures, Qatar is making steady progress towards a more diversified and sustainable economy. The ongoing implementation of NDS3 is facilitating a transition towards a private sector-led, knowledge-based model. Reforms aimed at enhancing the protection and mobility of expatriate workers have been central to this effort.
Foreign labourers working at a football stadium construction site in 2015 in Doha, Qatar.
The removal of the No Objection Certificate requirement has enabled workers to change employers without prior approval, improving job mobility and strengthening labour rights. Expatriates are now entitled to a minimum wage, with additional allowances for food and housing, and are covered by the Wage Protection System, which ensures timely electronic payment of wages. Legal reforms also prohibit the confiscation of passports and mandate end-of-service benefits, paid annual leave, and medical insurance.
At the same time, Qatar is actively working to attract skilled talent and improve the business climate. The Ministry of Labour has launched a six-year strategy to increase the proportion of highly skilled foreign nationals in the workforce, supported by streamlined visa pathways and long-term residence permits for professionals and entrepreneurs. The strategy also aims to boost Qatari participation in the private sector, with targeted initiatives to upskill nationals and integrate them into key industries. Complementing these efforts, the government has introduced new company registration laws that allow full foreign ownership in most sectors and enable online business registration in under a week.
Climate and environmental strategy
The authorities also remain committed to their climate action agenda. Environmental sustainability is one of the seven strategic outcomes of NDS3, which aims to conserve natural resources, reduce emissions, and build resilience against future environmental threats. The Ministry of Environment and Climate Change has launched a national strategy for 2024–2030 that sets clear targets, including a 25% reduction in greenhouse gas emissions by 2030 and the protection of 30% of island and coastal areas. Flagship projects such as the Al Kharsaah Solar Power Plant are expected to reduce carbon emissions by over 26 million metric tonnes over their lifetime.
QatarEnergy is also playing a central role. Its environmental strategy includes carbon capture and storage, flaring reduction, wastewater recycling, and marine biodiversity protection. More than 7.5 million tonnes of CO₂ have been injected at its CCS facility since 2019; furthermore, it has relocated over 13,000 live corals as part of marine conservation efforts. These initiatives demonstrate that Qatar's climate agenda is not peripheral. It is central to its development strategy and is being pursued in parallel with its energy expansion plans.
The Sheraton Grand Doha Resort and Convention Hotel (C), the venue for the 2025 Arab–Islamic extraordinary summit, is pictured in Doha on September 15, 2025.
Risks and outlook
The IMF's mission concluded with a note of caution. Fluctuations in global energy prices, heightened geopolitical uncertainty, and potential disruptions to trade routes pose risks to Qatar's export earnings, fiscal revenues, and economic activity. Navigating this uncertain environment will require continued sound policy-making and proactive risk management.
Nonetheless, the overall message is clear. Qatar is on a stable and promising path. Its economic fundamentals are strong, its reform agenda is advancing, and its financial buffers remain robust. The country is positioning itself not only to weather external shocks, but to thrive in a changing global environment.
Qatar's experience offers valuable insights into how energy producers can adapt and lead. The road ahead will not be without challenges, but the direction of travel is encouraging, and the foundations are in place.
