According to official data, Oman, which is not a member of the OPEC of 12 nations, had reported a massive surplus in the first half of 2010 before it became a deficit due to excessive spending and the transfer of part of oil revenues. to the Reserve fund status. Of around RO680.3 million in 2009, the budget deficit fell to almost RO48.4m in 2010, a decrease of 92.9 percent, the Ministry of National Economy said in its latest monthly report.
A breakdown of the budget showed that spending increased to about RO7,963 billion in 2010 from RO7,428bn in 2009. Most of the increase was in current spending, which grew approximately 13.6% to RO4,790bn from RO4 .218bn. Capital expenditures were reduced by about 3.5 percent to RO2.586 billion from RO2.690bn.
The increase in capital spending was mainly due to allocations for the development of civil ministries, since investment in oil and gas production decreased by 11.9 and 20.4 percent, respectively, according to the report . The increase in spending was more than offset by a 17.3 percent growth in revenues to RO7,915 billion in 2010 from almost RO6,748bn in 2009.
Net oil export earnings, after transfers to the state reserve fund, increased by 21.8% to RO5,470bn from RO4,490bn.
Gas revenues increased 27.2 percent to RO929.9m from RO731.3m. The increase in oil exports was the result of an increase of almost $ 20 in oil prices and a large increase in Oman’s oil production, since the country is pushing an ambitious program to reverse a fall in its production of oil in previous years due to lower investment and focus on the development of the gas field. Oman’s oil production soared to more than 870,000 barrels per day in 2010 from around 806,000 bpd in 2009. Last year’s production was the highest in nearly eight years. Higher expenses were associated with an increase in oil production and prices to increase Oman’s GDP by almost 23.3 percent at current prices to RO22,201 million in 2010 from around RO17,999 million in 2009.
The report showed that the oil sector soared around 42.5 percent last year, while there was growth of 29 percent in the gas sector and 11.9 percent in the manufacturing sector. All other sectors also registered positive growth. Oman has just approved a new five-year development plan that aims to achieve real GDP growth of three percent per year and keep inflation under control.
Sultan Qaboos bin Saeed ratified the eighth plan in early 2011 to launch one of the largest development plans in the Gulf country aimed at massive investments and the intensification of plans to diversify its oil economy.
The Sultan also approved the 2011 budget, which predicted a record RO8,130 million expense and RO7,280 million revenue, leaving a deficit of RO850 million, almost 4% of GDP estimated for 2011.
“The plan aims to achieve a minimum real GDP growth of three percent a year and guarantees that inflation will remain at low levels … will focus on greater coordination between monetary and fiscal policies to achieve economic stability and in the continuation of ongoing projects with an “emphasis on new companies,” Oman’s official media said in March.
“The plan will also pursue diversification efforts and a push to expand the country’s oil and gas production and increase hydrocarbon reserves.”
The newspapers, citing a government statement, said the 2011 budget was almost nine percent higher than the 2010 budget, adding that this year’s budget is based on a record oil price of $ 58 per barrel. .