x Abu Dhabi, UAETuesday 25 July 2017

Steep decline in Qatar trade surplus as price of gas exports plummets

Qatar’s trade surplus peaked at 33 per cent of GDP in mid-2013. It has steadily declined since then, as the collapse in the price of gas exports hits the country’s export earnings, falling to 12 per cent of GDP in late 2015.

Qatar’s trade balance worsened significantly in January, as the collapse in commodities hit the world’s largest liquefied natural gas exporter.

The country’s trade surplus fell 58 per cent against the previous year, dropping to 7.3 billion Qatari riyals (Dh7.36bn) in January.

That was driven by a 33.6 per cent fall in the value of Qatari exports against the previous year, data from the ministry of development planning and statistics shows.

Qatar’s trade surplus peaked at 33 per cent of GDP in mid-2013. It has steadily declined since then, as the collapse in the price of gas exports hits the country’s export earnings, falling to 12 per cent of GDP in late 2015.

A trade surplus represents a net inflow of income as exports exceed imports. Running large trade surpluses has been crucial to the economic models of the Arabian Gulf states, which have used the influx of wealth to develop their economies.

Gas prices have fallen as global demand for commodities drops away. Asian LNG for delivery in April fell to $4.5 per million BTU on Friday, down 50 per cent from $14.7 per million BTU at its height in September 2014. Qatar exported more than 20 per cent of global LNG supplies in 2014, according to data from the International Gas Union.

The IMF estimates that the Middle East oil exporting ­nations collectively lost more than $360 billion in export earnings in 2015 from the collapse in the price of hydrocarbons.

RasGas, the Qatar state gas company, recently cut prices for the Indian importer Petronet LNG, as it seeks to shore up demand for gas. As part of the deal RasGas also waived fines it had imposed on Petronet after the Indian firm failed to import as much gas in 2015 as contracted.

abouyamorn@thenational.ae

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