Qatar Investment Fund NAV falls, but outlook optimistic

Fund’s top 10 holdings remained unchanged during fourth quarter

Qatar Investment Fund (QIF) said yesterday its net asset value (NAV) fell 2.7 per cent in the fourth quarter to December, even as it remains optimistic about the economy.

The fall in NAV compares with almost flat performance on the Qatar index, and a 4 per cent fall on MSCI Emerging Market index.

The QIF remains optimistic about Qatar due to its strong macroeconomic fundamentals, ongoing infrastructure spending, rising population and superior growth prospects in the non-hydrocarbon sector, the investment adviser said in an emailed statement yesterday.

Public sector loan growth

The QIF expects “public sector loan growth will remain strong, driven by the government’s infrastructure development plans and a rising population.” And this is evident from the country’s budget.

The budget is committed to reducing Qatar’s planned deficit by 38.9 per cent, to 28.4 billion Qatari riyals (Dh28.65 billion) in 2017, from 46.5 billion Qatari riyals, in 2016. The deficit is expected to decline due to a pick up in government revenues and continued rationalisation of current expenditure. Capital spending is expected to increase in 2017 to support Qatar’s preparation for the World Cup and economic diversification objectives.

The Qatari government, according to the QIF, is committed to continuing its infrastructure investment spending programme ahead of the 2022 Fifa World Cup and in line with the Qatar National Vision 2030.

QIF’s top 10 holdings remained unchanged in the quarter. They reduced holdings in Commercial Bank of Qatar and Gulf International Services, while holdings in Qatar Electricity and Water Company were increased as valuations became attractive.