DOHA – Business optimism for Qatar's business community declined in Q3 2012 due to uncertainty concerning the global economy, the latest Business Optimism Index for Qatar prepared by Dun & Bradstreet South Asia Middle East Ltd (D&B) in association with Qatar Financial Centre (QFC) Authority released Wednesday said. The composite index for the hydrocarbon sector stands at 4 in Q3 2012 versus 20 in Q2 2012, due to lower BOI scores for profits and selling prices. The BOI for level of selling prices has slid by 25 points to -3 in Q3 2012 as 13 percent of the respondents anticipate that prices will fall versus 10 percent that expect prices to rise. The BOI for net profit has dipped by 16 points to -8. 32 percent of the respondents expect that profit levels will not change; while 38 percent anticipate a decrease and the remaining 30 percent predict an increase. The BOI for number of employees has gained 2 points to 30 in Q3 2012 from 28 in the previous quarter. In the non-hydrocarbon sector, the BOI survey showed that the composite index stood at 27, which is 9 points lower compared to the figure in Q2 2012. The outlook has moderated probably due to the uncertainty surrounding the global economy and the eurozone crisis. The BOI scores for five of the six parameters have dropped in Q3 2012 compared to Q2 2012 levels. The BOI for the volume of sales parameter has decreased by 16 points to 33 in Q3 2012, while the BOI for new orders stands at 40 compared to 50 in the previous quarter. The BOI score for level of selling prices remains steady at 6 for Q3 2012. The CPI for the month of May 2012 was 110.1, showing a slight increase of 0.2 percent when compared to the CPI of April 2012, but a 1.1 percent increase when compared to the CPI of May, 2011. Annual inflation figures show increases in all the major groups, with the exception of rent, fuel and energy, which registered a drop of 6.0 percent. Commenting on the findings of the survey Prashant Kumar, Senior Manager, Research & Advisory at Dun and Bradstreet South Asia Middle East Ltd. said, "the BOI survey for Q3 2012 reveals a drop in optimism levels following the cautious approach adopted by the Qatar's business community. The global economic scenario has witnessed a greater degree of uncertainty and pessimism in the second quarter of 2012 due to fiscal slippage, banking downgrades, and political and financial uncertainty in the euro area. Qatar's economic expansion was driven by the mining and quarrying sector in 2011. After witnessing a six year period (2006-11) of high annual double digit growth, the pace of expansion is likely to be around 6 percent in 2012. The hydrocarbon sector has registered a drop of 16 points to 4. The survey said non-hydrocarbon sector optimism is weaker in Q3 2012. Transport, communications and construction sectors have recorded improvement in optimism. – SG
