Qatar Economic Outlook Issue Number 13

partners. When comparing between QR and 
US Dollar (either dollar index or dollar 
REER), the difference in the volume of trade 
exchange weights between the QR riyal's 
partners and the dollar's partners should be 
taken into consideration, as it becomes clear 
that the US dollar index is influenced by 
57% of the European market group 
variables, while the QR is only be affected 
by about 18% of the European market 
variables because the Asian market is the 
main partner of Qatar by more than 63%. 
Thus, if the QR index rises, it will increase 
the purchasing power for imported goods, 
but at the same time will discourage the 
export situation of Qatari products. On the 
other hand, a decline in the QR index would 

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Appendix: Economic and Financial Terms 
 
125 
of course increase the competitiveness of 
Qatari products. In terms of the impact of 
the contraction of the Qatar CPI during Oct 
2019- July 2020 compared to its trade 
partners, it is clear that this results in the 
increase of Qatar's REER and, thus, the QR 
purchasing power became stronger.
Qatar Stock Exchange Concepts
What is the methodology of measuring the 
performance of the Qatar Stock Exchange? 
The QSE measures the performance of its 
portfolio using three benchmark indices and 
eight sub-indices. There are three primary 
indices normally used, as follows:
The General Index: This contains the top 20 
largest and most liquid stocks, assigning a 
maximum weight for each share of 15%; 
hence the General Index is used to measure 
the performance of the price of shares 
comprising the index. 
The Index of Total Return (yield) of stocks is 
similar to the General Index regarding its 
composition, but it measures the income from 
the earnings of shares (i.e., the dividends). 
The Third index is the All-Shares Index, 
which as its name suggests, is comprised of 
all the shares listed on the stock exchange 
(about 44 companies) and which does not 
have an absolute ceiling for the weight of the 
shares. One caveat for this index is that its 
shares should have a movement of at least 
1%, which is the ratio of the number of shares 
transferred from one person to another 
during the year. The All-Shares Index 
measures both prices and the movement of 
income from dividends. Note that the All-
Shares Index is the average of the sub-
indices of the leading economic sectors 
(banking and finance, industry, insurance, 
real estate, consumption, communication, 
and transportation). It provides a mechanism 
for potential investors to analyze the 
performance of each economic sector 
concerning their prices and income from 
dividends. It also enables investors to 
compare the QSE with the performance of 
the S & P index. 
What is the methodology of measuring the 
performance of the Real Estate Index? 
During the past two decades, the real estate 
market in Qatar has witnessed sharp 
fluctuations because of imbalances between 
the forces of supply and demand, as was the 
case in the rest of the real estate markets at 
both global and GCC levels. In order to 
monitor the trajectory of the real estate 
market in terms of market value of real estate 
and to maintain the liquidity of the banking 
sector, given that real estate activities 
constitute about 38% of the local banks' 
credit, in 2011 the Qatar Central Bank (the 
entity supervising the financing process) in 
cooperation with the Ministry of Justice 
(responsible 
for 
the 
real 
estate 
documentation process), prepared an index 
of prices of real estate in Qatari cities. The 
Qatari real estate index is based on data of 
real estate sales deals (including land, 
residential villas, and residential real estate) 
that are collected by the Ministry of Justice 
with the exception of deals that are unusual 
or performed independently, such as the 
transfer of ownership within a family. The 
period April 2009 - March 2010 was selected 
as the baseline year for computing price 
changes. For more details on the index 
calculation methodology, kindly refer to the 
third financial stability report of the Qatar 
Central Bank (pages 85-86). 
There are also two additional indices that are 
directly related to real estate activities. The 
first one relates to rents, while the second 
one relates to credit facilities for real estate, 
where the average change in the rental price 

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