A E James
Muscat: Oman’s budget deficit for 2016 stood at OMR5,010.5 million as falling crude oil export revenues started affecting fiscal balance, according to the latest monthly statistics released by the Central Bank of Oman (CBO).
This is slightly lower than an initial OMR5,300 million estimated by the government at the time of announcing this year’s state budget, but much higher than the budget proposal of OMR3,300 million for 2016.
The Sultanate’s government has enhanced its overseas borrowings to meet the deficit as the government does not want to disturb the liquidity situation and interest rates within the domestic market.
The country’s total revenue for last year was OMR7.3 billion, while total expenditure touched OMR12.3 billion.
Of the total revenue, OMR3.6 billion came from net crude oil revenue, the CBO report said. The average price of Oman Crude declined by 28.9 per cent to $40.1 per barrel from $56.5 a barrel in the previous year. This is against an assumed price of $45 per barrel for calculating budget revenue.
However, Oman’s crude oil and condensate production rose by 2.6 per cent to 367.56 million barrels in 2016, from 358.10 million barrels in the previous year.
Revenue from natural gas touched OMR1.5 billion, while other income was around OMR2.1 billion for 2016.
The CBO report said that the investment expenditure in 2016 was OMR2.3 billion.
The Sultanate has been taking major measures to strengthen its non-oil sectors, especially the industrial and mining sectors, as part of its diversification programmes.The country’s national initiative for diversification – Tanfeedh – is also taking several major initiatives to attract both foreign and local private investment to sustain economic growth.
Oman government’s expenditure and revenue for 2016 are estimated at OMR11.9 billion and OMR8.6 billion, respectively, when the government announced its budget proposal in January 2016.
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