GDP growth slips by 4.3% to RO 29.3 billion in 2019

MUSCAT: The National Centre for Statistics and Information (NCSI) has released the fourth issue of the Economic Outlook of Oman, highlighting the Sultanate’s economic performance during 2019 and the prospective developments witnessed due to global economic impact.

The NCSI report highlights the Sultanate’s economic performance in 2019, which recorded a decline in the growth of GDP at current prices by 4.3 per cent as a result of the decrease in the value added of oil activities by 8.4 per cent and a decrease in non-oil activities by 1.5 per cent. The GDP decreased to RO 29.3 billion in 2019, compared to RO 30.7 billion in 2018.

The report shows that the deficit in the Sultanate’s general budget reached RO 2.62 billion, recording a decline in the total revenue by 3.3 per cent, while the total public spending decreased by 2.9 per cent, recording RO 13.2 billion.

The decrease in the Sultanate’s public spending in 2019 was due to the decrease in investment expenditures by 7.4 per cent, compared to the previous year.

The report states that the domestic liquidity (M2) in Oman grew by 2 per cent in 2019, reaching RO 17.8 billion, compared to RO 17.4 billion in 2018. This increase in 2019 was due to the increase in the money supply in its narrow sense (M1) by 8.5 per cent in 2019, reaching RO 5.3 billion, compared to the previous year.

The Economic Outlook of Oman also shows that the total deposits in the Sultanate’s commercial banks increased by 0.3 per cent in 2019, reaching RO 20.1 billion, compared to the previous year of 2018, where it reached RO 20 billion. This increase is attributed to an increase by 3.9 per cent in the total private sector and an increase by 0.7 per cent in the government sector deposits — ministries and other government agencies, while the deposit of other public establishment decreased by 27.5 per cent in 2019, compared to the previous year.

The report points out that Muscat Securities Market index declined by 7.9 per cent in 2019, reaching 3.981 points, compared to the previous year of 2018. The Shariah Index also declined by 9.4 per cent in 2019, compared to 2018.

The report also states out that the volume of foreign direct investment in the Sultanate till the end of the fourth quarter of 2019 reached RO 14.6 billion, compared to RO 12.7 billion in 2018, while the inflow volume of foreign direct investment till the end of the fourth quarter of 2019 reached RO 1.9 billion.

It shows that the tourism share in GDP increased from 2.2 per cent in 2018 to 2.5 per cent in 2019, while direct value added of the tourism sector increased by 4.1 per cent in 2019, recording RO 717.9 million, compared to RO 689.5 million in 2018. The tourism balance recorded a deficit of RO 256.4 million in 2019, down from the recorded deficit in 2018, reaching RO 19.7 million. The Sultanate’s inflation for the base year (2012) rate was 0.1 per cent in 2019, compared to 0.9 per cent in 2018.

The volume of trade exchange in the Sultanate decreased by 7.8 per cent in 2019, compared to the previous year, reaching about RO 23.9 billion, compared to RO 26 billion in 2018. This decrease was due to a drop in the value of commodity imports by 9.5 per cent, and the commodity exports which declined by 7.2 per cent in 2019, compared to 2018.

The Sultanate’s trade balance in 2019 recorded a surplus of RO 5.9 billion, down by 4.7 per cent from the surplus recorded in 2018.

The report also points out that the labour market and employment recorded a decline by 2.5 per cent in 2019, while the total number of workers in the Sultanate in 2019 reached 2.16 million workers, compared to about 2.21 million workers in 2018. The percentage of workers in the private and family sector reached 89 per cent of the total number of workers, compared to only 11 per cent in the government sector.

The Economic Outlook of Oman report points out that, according to the expectations of the Arab Monetary Fund, the Sultanate’s GDP growth may decrease by 3.8 per cent due to the impact of the performance of oil and non-oil activities, due to the repercussions resulting from the Covid-19 pandemic.

The fourth issue of the Economic Outlook of Oman is available on the website of NCSI: www.ncsi.gov.om.