MUSCAT –
Oman’s public finances are continuing to improve with the sultanate’s budget deficit for the full year 2018 falling to the lowest level in four years.
According to the preliminary estimates of the closing of the government finance accounts for fiscal year 2018, Oman’s budget deficit last year decreased to RO2.7bn against RO3bn estimated in 2018 budget, Oman News Agency reported.
The lower deficit was a result of higher than expected revenues during the year, which came at around RO10.9bn against RO9.5bn estimated in last year’s budget.
Oman’s annual budget deficit gradually decreased during the past four years as a result of measures taken by the government during this period to mitigate the impact of sharp drop in oil prices. The sultanate’s total expenditure decreased from RO15.2bn in 2014 to about RO13.6bn in 2018, while non-oil revenues increased from RO2.2bn in 2014 to RO2.4bn in 2018. As a result of fiscal reforms and increase in oil and non-oil revenues Oman’s budget deficit dropped from RO4.63bn in 2015 to RO2.7bn last year, the lowest level in past four years.
Global ratings agency Moody’s Investors Service has said Oman’s budget deficit is expected to remain at around nine per cent of the country’s GDP in 2019. The ratings agency’s forecast for the sultanate’s deficit is in line with the government’s 2019 budget estimate.
In its issuer comment report on Oman’s 2019 budget, Moody’s said the sultanate’s budget plan contains few significant new measures that would help to reverse Oman’s fiscal deterioration, stabilise its debt dynamics and reduce its vulnerability to potential declines in oil prices.
Oman’s nominal gross domestic product (GDP) grew 15.3 per cent in the first nine months of 2018 compared to the same period of the previous year.
The International Monetary Fund (IMF) recently predicted that Oman will become the fastest growing economy in the GCC region in 2019. According to the IMF, the sultanate’s real GDP is expected to grow by more than five per cent in 2019.
