FIFA World Cup To Have Favourable Economic Impact Over Next ...| MENAFN.COM

Thursday, 02 February 2023 05:31 GMT

FIFA World Cup To Have Favourable Economic Impact Over Next 12 Months: QFC


(MENAFN- Gulf Times)

The FIFA World Cup, which kicks off here in the next two weeks, is expected to leave a 'favourable' economic impact over the next 12 months, according to the Qatar Financial Centre (QFC).
'There are hopes that the sporting event will have a favourable impact on the country over the next 12 months with sentiment improving to a two-year high,' QFC Authority chief executive officer Yousuf Mohamed al-Jaida said after disclosing the findings of the latest purchasing managers' index (PMI) survey.
The Qatar PMI indices are compiled from survey responses from a panel of around 450 private sector companies. The panel covers the manufacturing, construction, wholesale, retail, and services sectors, and reflects the structure of the non-energy economy according to official national accounts data.
Highlighting that the FIFA World Cup will bring with it a large influx of tourist activity to Qatar, he said sustained increases in output suggest businesses are geared up for a busy four weeks of trading.
The latest PMI data found that Doha's non-oil private sector saw moderation at the start of fourth quarter but rate of growth in total economic activity remained marked as firms prepare for an influx of sales in anticipation of the FIFA World Cup.
The survey data said expectations were boosted by the fast-approaching World Cup with sentiment at a two-year high in October.
Prices data signalled improving profitability with near-record uplift in selling charges alongside only a marginal increase in input costs.
The data found new orders eased, while purchasing activity also cooled. Meanwhile, firms trimmed their headcounts to a record degree in an effort to save on costs.
'While output continued to expand robustly, firms reported a further softening in new orders. Subsequently, businesses were keen to make efficiency gains where they could and reduced their buying activity during the month. There were also efforts to scale back headcounts which reduced at the quickest rate in the survey's history,' said al-Jaida.
The headline PMI is a composite single-figure indicator of non-energy private sector performance. It is derived from indicators for new orders, output, employment, suppliers' delivery times and stocks of purchases.
At 48.4 in October, down from 50.7 in September, the latest PMI pointed to a moderation in non-energy private sector business conditions. The latest result brought an end to 27 successive months of growth. The headline figure was only marginally below the neutral value of 50.
The sustained moderation in new orders led non-energy companies in Qatar to scale back on their purchasing activity. The rate of decline was sharp, but softer than the contractions seen during the height of the pandemic.
Turning to prices, overall input prices rose for the third month running. A renewed uptick in purchase costs drove the latest increase.
'The rate of inflation was only marginal, however, amid a fall in staff costs,' the survey said.
Firms in turn raised their selling prices sharply, and at the third-quickest rate in the survey's history, behind that seen only in the previous survey period and November 2021. According to panel comments, firms hiked charges to capitalise on greater tourist activity.
'Looking ahead, firms were widely upbeat about their output expectations over the year ahead. Firms were hopeful that the FIFA World Cup would have a positive impact on output growth,' it said.
The latest PMI data on Qatar's financial services sector signalled a further marked improvement during October, with business activity now increasing in each month since July 2021.
The rate of output growth was robust and much quicker than the long-run series average.
New orders rose again, as has been the case since June 2020. The rate of growth was the softest for 15 months, however.

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