Posted on June 19, 2011

Unemployment in Qatar dropped to about 0.5 percent last year thanks to significant growth in the Gulf state's non-hydrocarbon sector, Business Monitor International said in a new report.

The study said the low jobless figure was one of the main reasons why the protests seen in neighbouring Bahrain, Oman and, to a lesser degree, Saudi Arabia would not spread to Qatar.

BMI said its latest short-term political risk ratings ranked Qatar at number 14 globally out of a total of 168 countries covered.

"Although we note that every country in the region is susceptible to some sort of social protests, especially once ructions reached the Gulf, we reaffirm that Qatar's political risk profile is strong, and risks of political tensions in the sense of large-scale demonstrations that we have seen in Bahrain are very unlikely," analysts said.

In its study on the impact of the Arab Spring on the Gulf state, BMI said that Qatar's GDP of just above $100,000 per capita meant "the population's incentives to protest are less than they are in other states across the region".

"Therefore, we highlight that risks of social tensions bubbling into large-scale unrest are minimal, and forecast prolonged stability in Qatar's political arena accordingly," the report added.

BMI said the country has managed to ensure the highest living standards in the region (and the world) for its small population.

The majority of people living in Qatar are Indian and Pakistani workers, who will not likely protest against the government, nor will they fuel any tensions among the population," the report said.

"Meanwhile, Qataris, accounting for less than 30 percent of the population, have secure and lucrative jobs provided by the government in the public sector, leaving them with few reasons to demonstrate."

The report said Qatar did not have the problem of youth unemployment or housing shortages which have been grievances of opposition movements from Egypt to Bahrain.

According to the most recent data available, Qatar's unemployment rate came in at 0.5 percent in 2010, down from 3.2 percent in 2007.

"Behind this positive achievement are the government's reforms undertaken over the past few years, supporting growth in the non-hydrocarbon sector to accelerate in tandem with the rather poor job-creating LNG sector," BMI added.

Thousands of new jobs are also set to be created by Qatar's ambitious plans to build a rail network and to host the 2022 World Cup tournament.

"Housing is also far from being a problem. On the contrary, the construction boom prior to the 2009 global downturn has left Qatar with an oversupply of properties," the BMI report said.

Analysts added that poor living conditions, the main trigger of unrest in most countries in the Middle East and North Africa, was "one further factor that we can dismiss when assessing the potential for unrest to emerge in Qatar".

Further development projects by the government will also lower the risk of outbreaks of social unrest, BMI said.

by Andy Sambidge, Arabian Business