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Qatar ready to implement Basel 3 ahead of deadline

JEDDAH: Qatar already has plans to implement Basel 3 by 2013, five years ahead of the stipulated deadline, R. Seetharaman, chief executive officer, Doha Bank, said at "The Business & Investment in Qatar Forum" held in New York on April 6 and 7.

In a statement released Saturday, he said "Qatar is also working toward a single regulator. With this initiative, Qatar follows an international trend toward an integrated approach to the regulation of different financial services products and activities. In GCC, we have seen the single regulator only in Bahrain," he said at the forum attended by top International and Arab Bankers, economists and business professionals.

The strong continuing support from the Qatar government which was reflected in Qatar Investment Authority 's acquisition of 10 percent in Qatari banks in the beginning of the year has strengthened the financial position of these financial institutions, he added.

This significant move has put Qatari banks at the forefront in working toward implementing the requirements of the Basel Committee.

Seetharaman also said the current scenario prevailing in the global economy and the basic challenges economies face in moving from crisis to stability. "

Global economy is expected to grow at 4.4 percent in 2011.In Feb 2011 the G20 agreed indicators for measuring imbalances include public and private debt and level of private savings. The sovereign risks are mainly at euro zone. The EU announced last month a permanent $700-billion safety on concerns from Portugal," he said.

Giving his economic outlook on Qatar Economy, he said: "The national development strategy 2011-16 will balance challenges of Qatar's National vision 2030. Qatar economy is expected to have a robust growth in 2011 and a broadly favorable economy in the next 5 years."

"Beyond 2011 real GDP growth can drop as current investment in hydrocarbon decrease gets completed. Aggregate GDP growth in 2012-2016 is expected to average to 6.9 percent, out of which hydrocarbon GDP growth will be by 4.4 percent and non-hydrocarbon GDP by 9.1 percent. Overall fiscal position is expected to be healthy with a surplus of 5.7 percent of GDP by 2016 and current account balance will remain high at 15 percent of GDP by 2016. Even if average oil price is at $74 per barrel, average nominal GDP level of Qatar would shrink to 2 percent by 2016 and with Govt planning to diversify its income over period, adverse fiscal impacts would be dampened."

On industrial trends in Qatar, he said "services is going to be the major driver. By 2016 service sector could account for 40 percent of total output up from 36 percent in 2009. Transport and communications, financial services, could grow vigorously. Potential is also seen in construction and manufacturing. FIFA world cup 2022 may provide opportunities in tourism and other areas. World cup will create opportunities to form strategic alliances externally and to connect to global value chains."

© The Saudi Gazette 2011