Qatar plans to boost government spending by 27 percent in the fiscal year that began in April, including wages, social services and infrastructure, but it expects to see a comfortable surplus, state news agency Qatar News Agency (QNA) reported.
Tuesday's report comes amid concerns over safety standards in the Gulf Arab state after fires broke out at an aviation college and a girls' school on Tuesday following the deaths of at least 19 foreign nationals in a blaze at an upscale shopping mall on Monday.
Qatar, the world's top liquefied natural gas (LNG) exporter, projects record high expenditures of 178 billion Qatari riyals (49 billion US dollars) for the fiscal year, above the 140 billion planned for 2011-2012.
The country, which is due to host the soccer World Cup in 2022, has penciled in revenue of 206 billion riyals, a 26 percent rise from the previous year's budget plan and a surplus of 28 billion riyals, or 4.4 percent of 2011 gross domestic product (GDP), according to Reuters calculations.
The government expects to see a fiscal surplus of eight percent of GDP in the current fiscal year, up from 6.7 percent in 2011-2012, QNA said.
Qatar is less conservative in its oil price assumption this fiscal year as the budget is based on an average crude price of $65 per barrel, above $55 in previous two years. Brent crude is now around $107 per barrel, near five-month lows.
The Gulf Arab country, a major global investor through its sovereign wealth fund, has yet to release budget data for 2011-2012.
Funds allocated for public sector salaries soared 48 percent to 37 billion riyals in the 2012/13 budget, accounting for about a fifth of the overall plan, QNA said.
In September, Qatar, which has avoided the social unrest that rocked the Arab world last year, raised basic salaries and social benefits for state civilian employees by 60 percent, while military staff received 50-120 percent increases.
The International Monetary Fund (IMF) has said salary and pension hikes would add an estimated $1.6 billion to government expenditure in 2011-2012, but the actual fiscal balance was still projected to book a surplus of over seven percent of GDP in 2011-2012.
The authorities do not expect any further one-off rises in current expenditure, and aim to allocate 40 percent of the total spending toward capital expenditure over the medium term, the Fund said after concluding consultations with Qatar in January.
"Fiscal policy must continue to maintain a careful balance between spending on infrastructure to sustain non-inflationary growth, and saving and investing hydrocarbon surpluses abroad to generate sufficient income to finance future budgets," the IMF also said.
The country of 1.7 million people, which pegs its riyal to the US dollar, has outlined public investment plans worth $95 billion over five years to 2016, ahead of the World Cup.
That includes $11 billion on a new international airport, $5.5 billion on a deep-water seaport and one billion dollars for a transport corridor in Doha, as well as $20 billion on roads.
It plans to spend 62 billion riyals ($17 billion) on public projects in 2012-2013, up seven percent from the previous plan, QNA said.
Qatar's economic growth is expected to slow to 6.6 percent this year as the impact of two decades of gas output expansion fades, largely due to its self-imposed moratorium on new hydrocarbon projects to conserve resources, according to the latest Reuters poll of analysts in March. But that would still be the fastest rate in the Gulf.
Alba raises contractor safety awareness
Aluminium Bahrain B.S.C. (Alba)'s commitment to increased safety awareness across the entire plant and to steer the organisation towards a zero accident work environment continues to gain greater mom
Kuwait replaces top oil sector officials
State-run Kuwait Petroleum Company (KPC) appointed a new chief executive and suspended other top officials after the country paid $2.2 billion in damages to Dow Chemical Co over a scrapped plastics