Qatar to buy bank real estate portfolios
"Qatar is diversifying its economy"
Qatar's government has announced it is to purchase $4.1 billion of bank porfolios in the booming real estate sector in the gas-rich Gulf state by the end of June.
"The Qatari government has decided to buy the real estate portfolios and investments that Qatari banks want to sell," said Prime Minister Sheikh Hamad bin Jassem al-Thani.
In a statement carried by state news agency QNA, he said the value would total 15 billion riyals ($4.1 billion). The central bank governor would be in charge of the operation, with a target date of end-June.
The operation aims to "support the real estate sector... and allow banks to continue to play their vital role" in the development of Qatar, he said.
Qatar, the world's top exporter of liquefied natural gas, has been diversifying its economy away from hydrocarbons and developing its real estate and financial sectors.
It set up the Qatar Financial Centre to boost business for foreign-owned firms and is home to property giant developers Barwa Real Estate and Diar, which build mega-construction projects.
As part of efforts to shield the country from the global financial crisis, the government has intervened several times and in March bought up the investment portfolios of local banks in the Doha stock exchange.
The aim was also to free up the liquidity of banks and their capacity to finance development projects.
National Bank of Kuwait said gross domestic product in Qatar - which has the third-largest gas reserves on the planet - is estimated to have grown by 18 per cent in real terms last year, "an extremely fast pace by any standard."
"The gas sector (almost) doubled in size in 2008, partly on higher energy prices, but also on the continued increase in output volumes," said NBK, which releases regular research notes on the Gulf monarchies.
Qatar has proven reserves of more than 25 trillion cubic metres of natural gas or 15 per cent of the global total.