Qatari borrowers will sell around $15bn of bonds to finance some of the $142bn in infrastructure and other projects planned by the oil and gas exporter's government, finance minister said on Monday. They will also borrow about $55bn in syndicated loans and raise the rest of the $142bn in project finance, Finance Minister Youssef Kamal told a conference in Doha.
Qatar, which has the world's third-largest gas reserves, is investing revenues from energy exports in roads, tourism, real estate and industry.
The government has about $70bn worth of projects planned or open for bidding and a further $72bn underway or just completed, Kamal said.
“Of these around 50 per cent will be project finance, $55bn through syndication and $15bn in bonds," he said, of funding for the projects.
A global credit crisis triggered by U.S. mortgage defaults has hit bond sales around the world and made banks more reluctant to lend. That will not affect Qatar's plans, Kamal said.
"While the global debt capital market has caught pneumonia, the regional markets have displayed few symptoms of catching a cold," he said.
With oil prices increasing five-fold since 2002 to record highs near $100 a barrel, Qatar and other Gulf oil producers are spending their windfall on developing industry, tourism and financial services to reduce reliance on energy exports.
Gulf Arab states had more than $1.25trillion of infrastructure projects planned, Dubai-based consultancy Proleads said in October.
The Middle East accounted for $1 of every $3 raised in the global project finance market last year, according to HSBC. (Reuters)