Qatar Economic Outlook Issue Number 13

Current Account 
The current account consists of the trade 
balance, plus the balances of services, 
income, and current transfers. The 
merchandise trade balance
31
has taken on 
the role of being the primary driver of a 
surplus or deficit in the current account. The 
impact of the remaining balances (services, 
income, and current transfers) is limited, and 
their balance is always negative, since 
Qatar’s outflows are higher than its inflows, 
as shown in Figure (2-47).
The average net merchandise trade balance 
in 2020 was about positive 18.8% of the 
GDP, compared to positive 23.6% in 2019. 
This is followed by the net transfers balance 
with about negative 8.6% compared to 
negative 9.4% in 2019, followed by the net 
balance of services by about negative 10.6% 
compared to about negative 9.2% in 2019, 
then the net income balance by about 
negative 2.1% compared to about negative 
2.5% in 2019. 
From the foregoing, it can be concluded that 
the decline in the trade balance by 4.8 
percentage points compared to 2019 was 
caused by the decline in financial returns 
from reduced hydrocarbon exports as a result 
of the repercussions of Covid-19 on the 
world’s economies and the consequent 
downturn in demand for energy.
31
Difference between goods exports and imports 
It is notable that the balance of services 
measures the value of services related to 
trade balance transactions in terms of 
estimating the cost of services required for 
export and import; in addition, it records the 
balance of services for transactions related to 
transportation, insurance, tourism & travel, 
and communications services, all of which 
were badly affected by Covid-19’s 
repercussions. Consequently, the decline 
rate in the balance of services witnessed a 
further deterioration by 1.3 percentage points 
during the same period. 
Conversely, the income balance was also 
affected 
positively 
by 
Covid-19 
repercussions, in favor of the State of Qatar 
because the decline in foreign investment 
profits in Qatar led to a decline in outflows; 
nevertheless, the net balance is still negative. 
The same applies to the balance of current 
transfers, where the decline in the income of 
expatriate workers led to a slight relative 
decline in the outflows from the State of Qatar 
to the outside world in the form of 
expatriates’ remittances.