MUSCAT: As the year draws to a close, the Sultanate of Oman can look back on a period of remarkable economic achievements. Aligned with national priorities, the 10th Five-Year Development Plan, and the ambitious goals of "Oman Vision 2040," the country witnessed a year of significant growth and progress, bolstering the performance of the Omani economy and improving the lives of its citizens.
Nasser bin Rashid al Maawali, Under-Secretary of the Ministry of Economy, highlighted the positive economic indicators that paint a promising picture for the future. "The Omani economy concludes the year with qualitative improvement and reassuring indicators," he stated, attributing this success to effective economic and financial policies.
The total added value of oil activities at constant prices increased by 0.5% to constitute 34.3% of the gross domestic product until the end of the third quarter of 2023, he said.
Despite a slight decline in oil production, the overall GDP at constant prices grew by 2% to reach RO 26.4 billion by the third quarter of 2023. This growth was driven by a vibrant non-oil sector, which saw its added value increase by 2.7%, constituting 68.8% of GDP. The growth rates ranged between 26.8% for communications and information activity, and 0.6% for housing and food services activities. On the other hand, construction activity, manufacturing activity, financial activities, and insurance activities recorded a decline of 5%, 2.6%, and 9%, respectively.
Proactive government measures effectively mitigated the global inflationary pressures, keeping Oman's inflation rate within manageable limits. The consumer price index recorded a modest 1.03% increase in the January-November 2023 period, a significant drop compared to 2.9% in the same period of 2022.
Commenting on the performance of public finances, the Under-Secretary stressed the continued improvement of the financial situation during the year 2023. Public revenues declined 17.4% to reach about RO 9.8 billion until October 2023, due to the decline in average oil prices to reach $81 per barrel.
Public spending also decreased by 15.8% to reach about RO 9 billion as a result of the continued implementation of financial control measures. This led to the state’s general budget achieving a financial surplus of RO 830 million, compared to a financial surplus of RO 1.21 billion in the same period in 2022.
As a result of effective debt management measures, the total public debt of the Sultanate of Oman was further reduced by about RO 1.3 billion - or 7.4% lower from the end-2022 level - to reach about RO 16.3 billion at the end of October 2023.
The improving credit rating of the Sultanate of Oman was also reflected in the outlooks issued by the main international rating institutions. Fitch raised its credit rating for Oman in September 2023 to BB+ with a stable future outlook. Standard & Poor’s credit rating in September 2023 was upgraded to BB+ with a stable outlook as well. Likewise, Moody’s raised its credit rating in May 2023 to Ba2 while maintaining its positive outlook, as a result of the improvement in public financial performance indicators and the continued implementation of financial control measures.
These improvements in the credit rating of Oman will reflect positively on creating an attractive environment for investment, attracting the largest number of qualitative foreign investments, and improving the image of the Omani economy with international organizations, the data of which investors rely on to decide whether or not to invest in a particular country, he noted.
Three years into the 10th Five-Year Development Plan, Oman remains firmly on track to achieve the ambitious goals of "Oman Vision 2040." The GDP at current prices reached RO 31.4 billion, signifying the country's progress towards a diversified and sustainable future.
Dr Al Maawali emphasized that the Omani economy is well-positioned for further success in the coming year and beyond. With its commitment to sound policies, diversification, and fiscal responsibility, Oman is poised to cement its place as a thriving economic hub in the region. (ONA)
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