Posted on April 19, 2011

Qatar's Business Optimism Index (BOI) for the second quarter of 2011 has lowered due to the uncertainty prevailing in the region, according to Dun & Bradstreet which conducted the survey in association with Qatar Financial Centre Authority (QFCA).

Announcing the details of the Q2 BOI, officials said the Composite Index for the non-hydrocarbon sector dropped to 42 due to the events happening in the Middle East and North Africa region. Dun and Bradstreet South Asia & Middle East, CFO Phil Strange said, "It is not surprising to note the decline. The backdrop to the Q2 survey was one of political unrest in a number of Middle Eastern and African countries, the earthquakes in Japan and the continued Eurozone sovereign debt worries."

The non-hydrocarbon sector, while dropping from 19 to 42, is still showing strong optimism and in fact remains more optimistic than any of the 2010 readings in the index; demonstrating strong resilience in the face of the negative regional and global factors that have recently occurred. The 29 point fall in the hydrocarbon sector to 1 is perhaps a little surprising given the fact that supply fears owing to Middle Eastern tensions is driving the oil price so strongly up, he said.

The survey reveals that 60% of the respondents in the hydrocarbon sector predict prices will remain at current levels in Q2 2011. 25% expect prices to go up while 15% expect a decline. The BOI for Level of Selling Prices stands at 10, and is 15 points lower than the score in the previous quarter. This is because prices are expected to remain at current levels with a possible increase if the situation in the Middle East worsens.

QFCA Acting CEO Shashank Srivastava said, "Qatar's stability and resilience stands out despite recent regional political turbulence and global economic fragility. This is further evidenced by March's positive corporate earnings announcements made to the Qatar Exchange". The next BOI for Qatar will be released in July 2011, officials said.