In the space of five years, the amount has risen by almost a billion rials, and while it flattened last year, according to the bank’s data, it still managed to rise by a single per cent.
Over the previous four years, it rose by 100 per cent, according to the Central Bank of Oman
’s statistical annual review.
That’s good news for the economy, experts and residents agree. The number of blue collar workers arriving in the Sultanate – most of whom send the majority of their salaries home – has also impacted on the numbers
In its report, the Central Bank of Oman
stated that the money exchange houses expats use to send their hard earned wages home have a valued place in Oman’s economy and perform a vital service that could otherwise be filled by the black market.
Remittances rose from below OMR3 billion in 2012 to around OMR3.7 billion in 2016 while the actuall number of transactions also rose to 13.24 million when compared to much below 10 million five years ago.
The CBO report states: “Money exchange companies are primarily engaged in the business of remittances and currency exchange. The flexible working hours and efficient operations of these companies ensure the documentation of remittances and discourage informal channels of money transfer especially for small ticket remittances.”
Exchange houses say that this clearly shows that the economy is still strong and that the projects are on track. “Despite a turmoil in the region, expats are coming to Oman and sending home money,” a general manager of an exchange company said.
Commenting on the report, a financial expert based in Oman, said that the remittance outflow has always been high in GCC due to higher percentage of expat labour in this region. “Around 40%-50% (in UAE it is even higher) of the total population in the region is expats, predominantly from India, Pakistan and Bangladesh,” he said.
Exchange houses also attribute this to an increased expat blue collar workforce in Oman which has almost tripled in a decade.
The National Centre for Statistics and Information (NCSI) has released its 2017 Statistical Handbook, in which it has shed light on the country’s development, and provided data between 2007 and 2016 on expats in the country.
The expat workforce increased significantly since 2007, rising steadily from 660,950, to 1,825,603 people in 2016.
The expat population in Oman also increased from 820,000 in 2011, to 1,986,000 in 2016.
“Most of the people coming today are blue collar workers who send home most of the money they earn. So, the remittances are also going up over the years,” said S Bhuiyan, president of Bangladesh Social Club.
“There has been an increase in population of expats in the country but the rise of remittance is not proportionate so either expats are spending their money in Oman or they are earning less probably. We can’t say for sure but as long as there is a rise the economic indicator is that the shape of the economy is good. A 30 per cent rise in five years is good, not too much not too less. My employees have been sending nearly the same amount of money since last year,” Shazia Jahazeb, MD of Four Star companies said.
Imtiaz Sikder, a financial analyst based in Oman, believes that this year reflects a healthy slowdown of remittances.
“A small rise is good. Too much is bad. This year the curve has flattened which is a good thing for Oman as money is staying in the country while not going lower. I have personally noticed people sending the same amount over the past year which shows that there is a healthy slowdown in remittances.”