29 Jun 2012 (64 Pages)
Includes 3 FREE Quarterly Updates.
Key highlights include:- The Omani government announced plans to invest OMR314.9mn (US$817.9mn) in road infrastructure projects during 2012. OMR60mn (US$155.8mn) will go towards the OMR250mn (US$649mn) Sur-Bidbid dual carriageway, OMR62.5mn (US$162.3mn) towards the OMR62.5mn (US$162.3mn) Al Batinah Expressway and OMR10mn (US$25.9mn) towards the OMR40m (US$103.8mn) Mahdha-Al Rawda dual carriageway. The government has also announced that 681 infrastructure development projects, worth a total of OMR1.5bn (US$3.9bn), will begin during 2012. - The Omani Public Authority for Electricity and Water (PAEW) announced that it has allocated OMR390mn (US$1.01bn) for electricity and water infrastructure development in 2012, reports ameinfo.com. The PAEW is undertaking the construction of four new power plants in different governorates and is also considering building further new facilities in both Duqm and Salalah. A 450MW power and desalination power plant will open in Salalah in April 2012. - State-owned Oman Oil Company was granted a mandate to develop an Independent Power Project (IPP) in the governorate of Musandam, following a 'closed' procurement process. The gas-fired project will have a power generation capacity of nearly 120MW in its initial stages, and will be developed alongside the US$600mn Musandam Gas Plant project. The plant is scheduled to become operational in early 2014.
Oman's Consultative Council, which was elected for the first time on October 15 2011, is unlikely to bring major changes to the country's political system, which is dominated by Sultan Qaboos bin Said al- Said. While Qaboos's decision to change the Council from a purely advisory appointed body, to an elected one that participates in the legislative process has brought about minor changes thus far, we do not expect significant concessions to be made.
Oman's economy is set to hit a cyclical peak in 2012, and we have raised our real GDP growth forecasts to 5.4% and 4.0% y-o-y in 2012 and 2013 respectively, from 4.5% and 3.4% previously. Elevated oil receipts will drive this expansion, which will feed through to government consumption and fixed investment. Oman's fiscal situation is set to worsen over the medium-term. Expenditure, mainly geared towards current consumption, will rise by 11.0% y-o-y in 2012, owing to governmental efforts to create greater public sector employment opportunities. These commitments will be difficult to pull back in the future. At the same time, oil revenues are set to decrease on the back of falling prices and export volumes.