Qatar’s booming revenues from liquefied natural gas more than tripled budget surplus to 44.5 billion riyals ($12.2 billion) in the fiscal year ended in March, an Islamic bond issue prospectus showed on Monday.
According to a Reuters calculation, the tiny Gulf nation is the world’s top exporter of liquefied natural gas and its fiscal surplus for 2011/12 was equivalent to 7% of 2011 gross domestic product (GDP), up from the original 22.5 billion riyal ($6.15bn) plan.
The huge surge in revenues will help the government to spend more than 10% of GDP on average on infrastructure in the run-up to hosting the soccer World Cup tournament in 2022.
Doha posted a surplus of 12.8 billion riyals ($3.51bn), or 2.8% of GDP, in the previous fiscal year.
Qatar state budget surplus shrunk to 2.9% of quarterly economic output in the third quarter of its 2011/12 fiscal year, amid increased public spending and dropping revenues compared with the previous three months, official data showed on Thursday.
The prospectus disclosed that the OPEC member’s expenditure surged 11% to a record 158.9 billion riyals last fiscal year, well above the planned 139.9 billion riyals ($38.42bn).
“Due to a significant wage and pension increase … for Qatari government employees, government expenditure for salaries and wages is expected to significantly increase for future budgets,” the prospectus said.
In September, Qatar hiked basic salaries and social benefits for state civilian employees by 60%, while military staff received 50-120% increases.
Spending on government wages and salaries rose more than 9% to 25.2 billion riyals ($6.92bn) in 2011/12, the prospectus showed.
Doha last week mandated banks for investor meetings in Kuala Lumpur and Singapore starting on 9 July, Reuters quoted arranging banks as saying. The report added that a dollar-denominated sukuk issue may follow subject to market conditions.
The world’s top liquefied natural gas (LNG) exporter has not issued a sukuk since 2003.
Qatar is planning to boost spending further by over 12% to 178.6 billion riyals in the fiscal year that began in April, including on wages, services and infrastructure, but expects to see a still comfortable surplus of 27.8 billion riyals ($7.63bn).
Revenue soared by nearly 31% to an all-time high of 203.4 billion riyals in 2011/12, thanks to a jump in gas royalties and taxes as well as the business and corporate income tax, the prospectus showed.
Oil and gas-related revenue accounts for roughly 81% of Qatar’s overall budget income.
Doha’s total outstanding debt stood at $56.9 billion as of the end of March, or 32.8% of GDP, the prospectus disclosed.