QR60,000,000,000 bail-out of Qatar banks

Its as good as flushing money down the drain...

Most of the banks have invested in Real Estate ...which is stuck in a limbo due to the high rents.

Although the bail-out package has made life a little easier for the banks and made lending for car-purchase & personal loans easier...it has not solved the problem of getting "income" from the real estate.

Unless they force (by carrot or by stick)the real estate guys to lower the rents business just cannot happen in these difficult times.

Once the rents are down... Businesses will become attractive and the people will start comming back and then the rents can go high again.

Business, Commerce & investment are attracted by 4 basic factors:

1. Cheap Electricity

2. Cheap Rents

3. Cheap Manpower

4. Stable Governemt

Qatar has 1, 3 and 4 but very high No. 2. Rents...even though it has a lot of empty land.

Strangely, there are people who are wondering why banking stocks have decline so much recently:

Bank; Thursday's Close; 52 week high

Al Khaliji; 15.70; 20.80

Doha Bank; 35.70; 44.30

Islamic Finance; 35.50; 48.00

Commercial Bank; 63.00; 90.70

Qatar International Islamic; 39.40; 60.00

Qatar Islamic; 68.90; 88.90

Qatar National Bank; 118.90; 171.50

I wonder how much lower the prices would have slipped had the billions not been thrown at the banks.

In a nutshell the banks brought real estate and owned land in Qatar and around the World. They then re-valued these assets upwards this difference was described as "profits". Extravagant dividends were then paid out the shareholders on these "profits".

Of course none of this money existed. The only real money was the dividends paid out to shareholders that found it's way back into the economy and resulted in the massive wave of inflation we suffered.

We now see for ourselves the result of this. Massive bailouts by the government. And of course this is only the money we are hearing about. I expect millions if not billions of dollars has been further written off.

Qatari's will have their loans cancelled. They all owe a load of money but how many do you see going to court for not paying their bills ?.

They have to keep spending money and the people in charge know this. They are the only ones in this present economy who will spend, as they know they are safe from any sort of repercussions.

Us ex-pats HAVE to pay the money back, for this reason we have all reigned back out spending and now SAVE much more than we used to. We know the good times are OVER.

Comparing this to Western bank bailouts in the way some people have here is pointless and irrelevant. QR60 billion is a large amount given the size of the banking industry in Qatar.

And for those saying that Qatar wont have financial problems, you're kind of missing the point. No one expects Qatar to financially collapse, but these figures give a tangible view of how the banks have been affected.

The sum is peanuts compared to other countries and not much to be worried about. Only 6-8 new buildings that will have to wait a little longer. No need to get nervous

Probably just the government bailing out it's citizens that can't pay their loans so that they won't have to lower the rental prices as everyone was hoping.

Or to put it another way...

Income estimates are $24.4 billion in 2009-10 down by some 15% from the previous budget;

The budget suffers from a projected deficit of $1.6 billion, the first such shortfall since 2001;

The new fiscal year puts governmental spending at $26 billion, down by some $800 million from fiscal year 2008-09.

The authorities appropriated 40% or $10.4 billion of expenditures in the new budget for development projects. The amount falls short of $11 billion allocated for development projects in fiscal year 2008-09.

From: http://www.gulfnews.com/Business/Comment_and_Analysis/10303211.html

GDP (Constant Prices, National Currency) Statistics for Qatar, Year 2008 - In Detail

GDP (Constant Prices, National Currency) for Qatar is QAR 140.377 Billion.

In the previous year, 2007, GDP (Constant Prices, National Currency) for Qatar was QAR 120.14 Billion GDP (Constant Prices, National Currency) for Qatar in 2008 was or will be 16.84% more than it was or will be in 2007.

In the following or forecasted year, 2009, GDP (Constant Prices, National Currency) for Qatar was QAR 170.36 Billion, which is 21.36% more than the 2008 figure.

* Source: IMF

GDP (Constant Prices, National Currency) for Qatar, in other Years

Year Billion

In year 2013 241.251

In year 2012 228.692

In year 2011 216.823

In year 2010 203.386

In year 2009 170.361

In year 2008 140.377

In year 2007 120.141

In year 2006 103.622

In year 2005 90.082

In year 2004 82.463

In year 2003 70.048

In year 2002 65.883

In year 2001 63.84

In year 2000 60.047

In year 1999 54.126

In year 1998 51.302

In year 1997 47.053

In year 1996 36.632

In year 1995 34.045

In year 1994 32.852

In year 1993 32.221

In year 1992 32.368

In year 1991 29.927

In year 1990 30.711

In year 1989 35.98

In year 1988 34.169

In year 1987 32.636

In year 1986 32.344

In year 1985 31.188

In year 1984 35.862

In year 1983 30.918

In year 1982 32.659

In year 1981 35.58

In year 1980 37.021

This will give you all indications of how much of cash flow Qatar will have until 2013.

Be smart and have your IQ's way ahead.

God bless the H.H. The Emir Sheikh Hamad Bin Khalifa Al-Thani. He is super IQ with visions up smarted all leaders and governors.

ألله يطول بعمره ويعطيه كل الصحه والعافيه ... فيديتك يا ابو مشعل ... الله يحميك

Berlent, where on Earth did you get those figures from???????????

In the 2010 Budget, Government revenues total QR88.7bn, and the budget will be in deficit totalling QR5.8bn.

http://www.arabianbusiness.com/551470-qatar-predicts-budget-deficit-of-16bn

In other words, the government plans to spend US$1,590,000,000 more than it plans to earn in FY2010.

Update: Okay, so you're basing your argument on calculations made when oil was at $147/barrel.

You might want to watch Bloomberg a bit more often.

And quoting 2008 estimates midway through 2009 isn't a good way to win arguments.

Abu,

The description I just gave...

No rumor. fact.

And there are already 'laws' in place that enforce this.

Qatar is in the midst of an economic boom supported by its expanding production of natural gas and oil. Economic policy is focused on development of Qatar's nonassociated natural gas reserves and increasing private and foreign investment in non-energy sectors. Oil and gas account for more than 60% of GDP, roughly 85% of export earnings, and 70% of government revenues. Oil and gas have made Qatar the highest per-capita income country and one of the world's fastest growing. Sustained high oil prices and increased natural gas exports in recent years have helped build Qatar's budget and trade surpluses and foreign reserves. Proved oil reserves of more than 15 billion barrels should ensure continued output at current levels for 22 years. Qatar's proved reserves of natural gas are roughly 25 trillion cubic meters, about 15% of the world total and third largest in the world. Qatar has permitted substantial foreign investment in the development of its gas fields during the last decade and became the world's top liquefied natural gas (LNG) exporter in 2007.

Exchange rates

Qatari rials per US dollar - 3.64 (2004), 3.64 (2003), 3.64 (2002), 3.64 (2001), 3.64 (2000)

Exports $42,020,000,000.00 [54th of 189]

Exports to US $78,700,000.00 [94th of 224]

GDP $42,462,640,000.00 [60th of 203]

GDP (purchasing power parity) $71,420,000,000.00 [76th of 187]

GDP > Real growth rate 8.4% [27th of 198]

GDP growth > annual % 6.07 annual % [51st of 187]

Human Development Index 0.849 [40th of 178]

Inflation rate (consumer prices) 13.7% [13th of 192]

Public debt 11 % of GDP [108th of 121]

Total reserves minus gold > current US$ 4,542,368,000 $ [66th of 178]

Tourist arrivals 435,000 [71st of 152]

Tourist arrivals by region of origin > Europe 233,315 [86th of 195]

Qatar rank for its export value and rate for 2007

is: # 56 Qatar: $42,020,000,000.00 2007

GDP (Constant Prices, National Currency) for Qatar in year 2008 is QAR 140.377 Billion. Real GDP is expressed in billions of national currency units; the base year is country-specific.

GDP Growth (Constant Prices, National Currency) for Qatar in year 2008 is 16.843 %. Annual percentages of constant price GDP are year-on-year changes; the base year is country-specific.

GDP (Current Prices, National Currency) for Qatar in year 2008 is QAR 425.339 Billion. GDP is expressed in billions of national currency units.

GDP (Current Prices, US Dollars) for Qatar in year 2008 is US$ 116.851 Billion. Values are based upon GDP in national currency and the exchange rate projections provided by country economists for the group of other emerging market and developing countries. Exchanges rates for advanced economies are established in the WEO assumptions for each WEO exercise.

GDP Deflator for Qatar in year 2008 is 302.998 (Index, Base Year as per country's accounts = 100). The GDP deflator is derived by dividing current price GDP by constant price GDP and is considered to be an alternate measure of inflation. Please note: Data are expressed in the base year of each country's national accounts.

GDP Per Capita (Constant Prices, National Currency) for Qatar in year 2008 is QAR 127,892.73 . GDP is expressed in constant national currency per person. Data are derived by dividing constant price GDP by total population.

GDP Per Capita (Current Prices, National Currency) for Qatar in year 2008 is QAR 387,513.03 . GDP is expressed in current national currency per person. Data are derived by dividing current price GDP by total population.

GDP Per Capita (Current Prices, US Dollars) for Qatar in year 2008 is US$ 106,459.62 . GDP is expressed in current U.S. dollars per person. Data are derived by first converting GDP in national currency to U.S. dollars and then dividing it by total population.

Output Gap, Percent of Potential GDP for Qatar in year 2008 is not available

GDP (PPP), US Dollars for Qatar in year 2008 is US$ 95.13 Billion. These data form the basis for the country weights used to generate the World Economic Outlook country group composites for the domestic economy. Please note: The IMF is not a primary source for purchasing power parity (PPP) data. WEO weights have been created from primary sources and are used solely for purposes of generating country group composites. For primary source information, please refer to one of the following sources: the Organization for Economic Cooperation and Development, the World Bank, or the Penn World Tables. For further information see Box A2 in the April 2004 World Economic Outlook, Box 1.2 in the September 2003 World Economic Outlook for a discussion on the measurem

GDP Per Capita (PPP), US Dollars for Qatar in year 2008 is US$ 86,669.62 . These data form the basis for the country weights used to generate the World Economic Outlook country group composites for the domestic economy. Please note: The IMF is not a primary source for purchasing power parity (PPP) data. WEO weights have been created from primary sources and are used solely for purposes of generating country group composites. For primary source information, please refer to one of the following sources: the Organization for Economic Cooperation and Development, the World Bank, or the Penn World Tables. For further information see Box A2 in the April 2004 World Economic Outlook, Box 1.2 in the September 2003 World Economic Outlook for a discussion on the measurem

GDP Share of World Total (PPP) for Qatar in year 2008 is 0.127 %. These data form the basis for the country weights used to generate the World Economic Outlook country group composites for the domestic economy. Please note: The IMF is not a primary source for purchasing power parity (PPP) data. WEO weights have been created from primary sources and are used solely for purposes of generating country group composites. For primary source information, please refer to one of the following sources: the Organization for Economic Cooperation and Development, the World Bank, or the Penn World Tables. For further information see Box A2 in the April 2004 World Economic Outlook, Box 1.2 in the September 2003 World Economic Outlook for a discussion on the measurem

Implied PPP Conversion Rate for Qatar in year 2008 is 4.471 . These data form the basis for the country weights used to generate the World Economic Outlook country group composites for the domestic economy. Please note: The IMF is not a primary source for purchasing power parity (PPP) data. WEO weights have been created from primary sources and are used solely for purposes of generating country group composites. For primary source information, please refer to one of the following sources: the Organization for Economic Cooperation and Development, the World Bank, or the Penn World Tables. For further information see Box A2 in the April 2004 World Economic Outlook, Box 1.2 in the September 2003 World Economic Outlook for a discussion on the measurem

Investment (% of GDP) for Qatar in year 2008 is not available

Gross National Savings (% of GDP) for Qatar in year 2008 is not available

Inflation, Average Consumer Prices (Indexed to Year 2000) for Qatar in year 2008 is 176.794 (Index, Base Year 2000 = 100). Data for inflation are averages for the year, not end-of-period data. The index is based on 2000=100.

Inflation (Average Consumer Price Change %) for Qatar in year 2008 is 15 %. Data for inflation are averages for the year, not end-of-period data.

Inflation, End of Year (Indexed to Year 2000) for Qatar in year 2008 is 176.794 (Index, Base Year 2000 = 100). Data for inflation are end of the period, not annual average data. The index is based on 2000=100.

Inflation (End of Year Change %) for Qatar in year 2008 is 15 %. Data for inflation are end of the period, not annual average data.

Six-month London Interbank Offered Rate (LIBOR) Change % for Qatar in year 2008 is not available

Unemployment Rate (% of Labour Force) for Qatar in year 2008 is not available

Employment for Qatar in year 2008 is not available

Population for Qatar in year 2008 is 1.098 Million .

General Government Balance (National Currency) for Qatar in year 2008 is not available

General Government Balance (% of GDP) for Qatar in year 2008 is not available

General Government Structural Balance (National Currency) for Qatar in year 2008 is not available

General Government Structural Balance (% Potential GDP) for Qatar in year 2008 is not available

General Government Net Debt (National Currency) for Qatar in year 2008 is not available

General Government Net Debt (% GDP) for Qatar in year 2008 is not available

General Government Gross Debt (National Currency) for Qatar in year 2008 is not available

General Government Gross Debt (% GDP) for Qatar in year 2008 is not available

Current Account Balance (US Dollars) for Qatar in year 2008 is 50.147 Billion. Balance of payments data are based upon the methodology of the 5th edition of the International Monetary Fund's Balance of Payments Manual (1993). Data for the world total reflects errors, omissions, and asymmetries in balance of payments statistics on current account, as well as the exclusion of data for international organizations and a limited number of countries. Calculated as the sum of the balance of individual countries.

Current Account Balance (% GDP) for Qatar in year 2008 is 42.915 %. Balance of payments data are based upon the methodology of the 5th edition of the International Monetary Fund's Balance of Payments Manual (1993). Data for the world total reflects errors, omissions, and asymmetries in balance of payments statistics on current account, as well as the exclusion of data for international organizations and a limited number of countries. Calculated as the sum of the balance of individual countries.

* Source: IMF

For as long as Oil and Gas industry is pumping Qatar will have NO FINANCIAL PROBLEMS and that is based on Geological Studies for the next 52 years of reserve.

Therefore 60 billions QR's is a minor task for the Government to take care of it.

The returns on oil and gas are in excess of 10 trillion U.S.$'s.

The past ten month were really bad and it get worse for the privite sector and independant contractors. Lay offs and terminations has already started and Qatarization ONLY will benefit at all directions.

My advise use your common sense and google for more feedbacks. Be intellegent and read.

Good Luck to all.

So.... The Slow Poison has started working. Its going to get worse soon...i guess.

---------------------------------------------------------Write me OFF...at your own RISK....KK

It's only 10bn GBP which maybe a lot for the region but not much compared to what western governments have had to put in.

Already done Abu,

In QMA and related organizing and pre-opening offices of cultural village and related offices cutback have already been pushed through.

Allowances are being minimized. The way they did this was shameless.

They were supposed to cut the salaries in April, they did not, so they backdated WITHOUT ANNOUNCING the cutback on the May salaries, resulting in some people having 40% less salary. One guy had a salary that was build up out of special allowances only and was left with QR 4000 only, instead of the 20.000+.

It is sad to see that even in the government they can not stick to their own laws, so what to expect from privately owned companies.

Contract here = toilet paper.

Recession in Qatari dialect = "possible fallout from the mounting recessionary pressure"

LOL...if we just knew what is really going on in this state!

tallg,

and you accuse me of being negative, its just a bit of old sarcastic humor, can't help it in the middle of all this ;)

Ha Fubar,

good point.

As they first have to start utilizing the existing facilities

Al Sad Sports Club had a facility that, until coming October, has not been use since 2006 - FREAKING HUGE.

The sport stadium near the Tennis & Squash Federation, only now they woke up 'and smell the freaking roses' and started developing the facilities.

You can clearly see that the government is no longer sponsoring ridiculous expensive projects and that they need to become self-sufficient.

Although the article above gives yet again a different impression.

You think the Amir will, with Ramadan, waive a shitload of loans by Qatari's?

That 'erring scribe' should, nay MUST, be punished:

http://www.thepeninsulaqatar.com/Display_news.asp?section=Local_News&month=July2009&file=Local_News2009071224533.xml

All I can think of when seeing such a huge sum of money is how many new football stadiums now won't get built.

Maybe that's why it is located under 'opinion' :-P

Smart-asses

Indeed Talg,

I guess somebodies head will be chopped off soon. (unless they had approval of course)

Interesting also to see The Peninsula taking a proper swipe at the banks and regulatory authority.

Damn.

It is fun to see how they deny being affected by the crisis, just like the UAE.

We are not in recession and we are not being fired by the dozens........