Federation of Euro-Asian Stock Exchanges
Sultanate of Oman
70
Economic Development and Outlook
The economy likely had a good performance last year, with GDP expected to have rebounded on the back of increased hydrocarbon output and prices, after contracting in 2017. Preliminary figures also point to a falling fiscal deficit due to rising government revenues and despite higher spending, while international reserves increased and merchandise exports rose annually by nearly a third in the first 11 months of the year. Nevertheless, on 5 March, Moody’s downgraded Oman’s credit rating to Ba1 from Baa3 and said the rating outlook was negative due to the uncertain sustainability of the country’s persistent annual fiscal deficits. On 12 March, the EU added Oman to its blacklist of tax havens, which could hit bilateral economic ties.
Key Highlights
>74 percent of government revenues come from oil and gas
>Expenditure is budgeted to increase by three percent without curtailing development expenditure
>The deficit is predominantly financed out of borrowings
>The government is focused on achieving economic diversification and creation of employment opportunities.