Annual Report 2019

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Qatar Central Bank (QCB) published the forty-fourth Annual Report for the year 2020.

The report discusses the most important macroeconomic and financial developments during the year.

The report also provides the annual financial statement of QCB and important policy measures taken

by QCB during 2020.

During 2020, the Qatari economy contracted due to the emergence and global spread of the Covid-

19 epidemic, as the decline in global demand for energy and the decline in average energy prices

negatively affected the output of the oil sector, while the economic closure negatively affected the

non-oil sector; This eventually leads to a decline in the nominal GDP for the year 2020. This has

been reflected in the internal and external balances; The State budget recorded a financial deficit as

a result of the decline in demand and energy prices despite the reduction in expenditures, and the

current account in the balance of payments recorded a deficit as a result of the merchandise trade

surplus shrinking significantly. However, the Qatar Central Bank accumulated foreign exchange

reserves during the year as a result of the strong net inflow of capital witnessed by the capital and

financial account in the balance of payments.

QCB continued to pursue its mandated monetary policy objective of maintaining a pegged currency

while ensuring a stable

systemic liquidity. At the same time, measures were taken to ensure

comfortable systemic liquidity to facilitate adequate credit flows to productive sectors, and in

response to the interest rate cut by the US Federal Reserve, QCB cut all its policy rates twice in

March 2020, QCB also introduced a special repo at zero rate.

Fresh currencies were introduced and issued in December, leading to significant growth in the value

of currency. On payment and settlement systems, with sharp increase in demand for electronic

payment due to the pandemic, QCB launched a new retail payment system, 'Qatar Mobile Payment

System' (QMP) in April 2020 to provide instant clearing and 24 hours settlement of payments and

money transfers. And to increase financial inclusion, banks were advised to provide bank accounts

to domestic workers without minimum balance requirements.

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