Bahrain Mirror- Reuters: Qatar's government will restrain current spending to achieve small budget surpluses and transfer less money to its sovereign wealth fund in coming years if oil and gas prices do not rise, according to the country's new five-year development plan.

The National Development Strategy for 2018-2022, released by Prime Minister Sheikh Abdullah bin Nasser al-Thani on Wednesday, calls for the economy to become more self-reliant in food production and efficient in energy use as it faces a boycott by Saudi Arabia and three other Arab states.

The plan says the government will continue spending heavily on infrastructure, including projects related to Qatar's hosting of the World Cup soccer tournament in 2022.

But as the government seeks to become more efficient, its current spending - recurring expenditure on goods and services - will average about 21.2 percent of gross domestic product in 2018-2022, down from 32.6 percent in 2015, the plan says.

The government would run small fiscal surpluses during the period and GDP growth would average between 2.1 and 3.0 percent, with higher private sector investment in response to regulatory reforms compensating for slower growth in the energy sector.

The projections assume that average oil and gas prices in 2018-2022 will be in line with their levels in January 2017, when Brent oil was trading around $55 a barrel. That implies there is room for more strength in the economy and state finances than expected; Brent is currently around $65.

But the plan says there is no reason to expect noticeable rises above $55 in the medium term, so "rationalisation in public spending will continue until fiscal balance is achieved."

The government ran moderate fiscal deficits in 2016 and 2017 and GDP growth averaged 3.3 percent between 2013 and 2017, according to International Monetary Fund data.

The plan predicts Qatar's current account surpluses will shrink in 2018-2022 as the government and private sector import goods and services for investment projects.

This will lead to lower net transfers of money to the sovereign fund, the Qatar Investment Authority, and a fall in the national savings rate to 45.8 percent from 53.5 percent between 2011 and 2016, the plan predicts.

Arabic Version