Economic Tsunami gathering momentum in Qatar
Everyone was in denial that Dubai would and could be touched, including their Government, and then even they had to change their standpoint. Businesses closing, projects being placed on hold, insufficient money to complete some projects already in progress, job losses, falling property prices...only the very beginning.
Qatar still in the denial stage? Or just a freeze on the media frenzy that has stricken the world. What have you seen or heard?
Even Qatar has taken a slap from the falling of the oil & gas prices, and it does make sense that they have placed some projects on hold until their is further visibility. Imagine the impact on jobs and companies reliant on their business partners.
Heard this morning that a major company was laying off around 400 people and that another another larger company had already placed a new headcount freeze and may be following suit with reduction in their workforce.
People are talking now about losing their jobs and what they will do if that were to happen (repaying of loans in particular), a year back that was the furthest thought from people's minds as they lavished in the boom and security they felt economically here.
Property prices have fallen, heard to stem the start of any panic, some developments have restricted sales only through the authorised agency that they purchased them through, even a 2-month halt on any properties being allowed to be sold at the moment.
Rental prices are slowly falling, and their pace will increase as more properties are now unoccupied, even developers are losing out since they can't pay back the loans.
Car manufacturers are in major trouble worldwide, noticed the car prices on QL are falling and more negotiable, or is that just my imagination.
The signs are slowly forming, just being prudent or more aware and cautious naturally results in lower spending, especially on luxurious items/purchases which inturns has an economic impact on sales, jobs, rental etc....
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It is effecting.. there are job cuts happening all over . The fina exits issued per day is soring , its in 100s.
construction is been hit seeverly now..if the scenario prolongs 2009 is gona be worse.. its alarming.
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Qatars economy has very different economic drivers to Dubai's, not least of which is that Gas (Qatars main export) is generally sold on long term contracts and as such the price is not as volatile as oil. Of all the Gulf states the overall economy of Qatar will I suspect suffer the least.
"only mad dogs and englishmen go out in the midday sun"
all? men., havent even open an account here., nice start. and HSBC is the most vulnerable?
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veni, vidi, vici.
The banks have been receiving "cash injections" from the government.
same thing in the uae, just read this one...
UAE economic growth will fall by more than half next year to 3.1 per cent from 7.5pc this year on lower oil output and slowing consumer spending.
and yes, it's true that a number of companies here are doing lay off, being in that hiring & firing squad.
wonder how are the banks in doha doing?
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veni, vidi, vici.
I read in various news reports that Qatar's GDP growth in 2009 will be 10%, and all these reports seem to be impressed with this, what with the world economic crisis and all.
But if I remember the figures correctly, this is a drop from something like 20% this year and previous years. So I don't see why 10% next year is something to be impressed with. No one ever expected Qatar to suddenly slip into negative growth and a recession. This drop to 10% just proves that Qatar has been affected by the economic crisis.
Thanks for the update..
let's hope it doesn't happen..
Providing liquidity to the banks through either emergency loans or partial buy-outs is a symptom of a failing economic model (governments only intervene on this scale when things are fubar) and a band-aid (is the economy is that bad, a banking sector assistance package is not going to solve the real problem).
A prolonged downturn in Europe, Asia and the US will hit oil exporting countries hardest, and will drive the price of oil down. OPEC will respond by cutting production, which will help to raise the price of oil, but remember – you’re producing less oil, so the revenue situation isn’t helped, all you’re doing is hoarding your exports until they can be sold at a higher price.
If oil and gas production and export ceases to grow and expand, economic (and population) growth will also stall. The flow on impact is that investors had priced into their investments the notion that growth will continue into the future, which perhaps now it won’t. This will have a deflating impact on the price of some assets, particularly real estate.
The flow on effect into the real economy will be substantial.
Someone on QL the other day (aviduser perhaps) advised not to put your savings in HSBC Qatar as they would be the first to fold.
I think you have answered your own questions. The fact is that "investment" in Qatar dos not follow the Western model. here, the government can "inject" funds and enter into partnerships with local institutions as and when it feels sensible.
* How is Qatar Airways leveraged? Why are they borrowing more when everyone else is trying to reduce debt?
* How exposed are the local banks and wealth funds to the toxic triple-A's?
* Are local banks more exposed to property than their Western counterparts.
* Some banks in Doha are 51% owned locally, but are not managed that way. If HSBC or IBQ were to run out of money, will they be propped up by Qatar, or by their parent companies?
* Is the government willing to let a bank fail?
it was really a bad forecast to invest on high-ends developments. Instead of pushing for lower to middle class developments where marketing scope will be greater, they opted for expensive villas with limited group of buyers.
"dgoodrebel will always be the rebellious good one"
Yes, agreed. My point was that Qatar has already been affected in some ways and "the signs" have been here for quite a while, and have been extensively discussed on QL over the last few months.
But considering the title of the thread, I don't think there will be a "tsunami".
This was my point. Qatar being a small and rich country can afford to inject capital into the system and ensure that the crash does not happen.
This was my point. Qatar being a small and rich country can afford to inject capital into the system and ensure that the crash does not happen.
Lots of threads on QL about this already, talking about the bail-outs being given to the banks here etc.
The effects of greed, Every action has an equal and opposite reaction!
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I heard that Etihad is all set to buy up Emirates, the Airline only, not the group... and they are looking to buy Air-Arabia as well... lotsa crazy stuff happening over there... :-?
Dubai has already taken steps to "shore up" its economy and especially the real estate sector. I am sure that Qatar will be affected, but can't see it being a Tsunami. Projects will be delayed or postponed, but the government should be able to support the businesses.
It looks like an storm is coming...
War looking for peace,
is like fornication looking for virginity.
Get ready!
Get set!
GO!!!!
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