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Qatar Q2 business outlook reflects mixed sentiment.

The D&B Business Optimism Index, carried out by Dun & Bradstreet South Asia Middle East (D&B) in association with Qatar Financial Centre (QFC) Authority reveals that business optimism levels for four of the six parameters have edged up modestly, with the BOI dipping for the remaining two. The BOI for the Volume of Sales parameter has increased to 41 in Q2, while the BOI for Selling Prices has gone by up to 7 over the same time period. The BOI for the Number of Employees parameter has ticked up marginally by 1 point to 20 in Q2. The BOI for New orders has improved by 6 points from 33 in Q1 to 39 in Q2. <p>Businesses in Qatar have become more cautious with regard to holding inventories; the BOI for the Level of Stock parameter has registered an 8 points drop from 13 in Q1 to 5 in Q2. The BOI for Net Profits has fallen to 27 from 30 in Q1 suggesting that higher selling prices and volumes will not offset inflationary impact on the cost structure. <p>The D&B survey reveals that 37 per cent of the respondents expect borrowing conditions to improve during Q2. Availability of finance is edging lower as a business concern; it was a leading concern for 35 per cent of the respondents in Q1 and this number has dropped to 30 per cent in Q2. Raw material costs are the most important business concern in Q2 for 45 per cent of the non-hydrocarbon respondents. <p>Shashank Srivastava, Acting CEO of the Qatar Financial Center Authority said "after seeing a tightening of lending conditions last year, we are encouraged to see that based on Dun & Bradstreet's survey, a significant 37 per cent of the respondents are expecting borrowing conditions to improve during Q2. Additionally, availability of finance is decreasing as a business concern; it was a leading concern for 35 per cent of the respondents in Q1 and this number has dropped to 30 per cent in Q2. We believe that this is indicative of the resilience of the financial services industry in Qatar" <p>Commenting on the findings of the survey Phil Strange, Chief Financial Officer of Dun and Bradstreet South Asia Middle East, said, "Qatar is achieving steady GDP growth which is reflected in the D&B BOI survey where businesses are now more confident about continued growth of the domestic economy. However, developments in advanced economies, especially Europe, could disrupt the fragile global economic recovery; although Qatar seems well-placed to face such pressures."

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Publication:CPI Financial
Date:Apr 15, 2010
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