Oman Economic Forecast

Oman Economic Outlook

July 7, 2020

The economy likely contracted sharply in H1 due to the coronavirus pandemic and the slump in oil prices. Containment measures introduced to slow the spread of the virus hammered activity and contributed to month-on-month falls in private-sector employment in both April–May, most notably among expatriate workers. Exacerbating matters, the recent slump in oil prices forced the government to reduce its annual budget by another 5.0% in May, on top of the 10.0% cut announced in April. More positively, and despite its limited room for fiscal maneuver, the government has suspended several business taxes and postponed repayments of government-backed business loans to help struggling firms. Furthermore, containment measures have been gradually loosened over the past several weeks, which should support activity.

Oman Economic Growth

The economy will contract this year, hit by fallout from the Covid-19 pandemic and lower oil prices. Moreover, Oman has a weaker fiscal standing than some other oil exporters in the region, making it more vulnerable to a prolonged period of cheap oil. However, looser monetary policy should support activity. FocusEconomics Consensus Forecast panelists project the economy to shrink 4.2% in 2020, which is down 1.1 percentage points from last month’s forecast, before growing 2.3% in 2021.

Oman Economy Data

2015 2016 2017 2018 2019
Population (million)3.84.04.14.24.3
GDP per capita (USD)18,08016,31117,02018,94717,659
GDP (USD bn)68.365.470.579.276.0
Economic Growth (GDP, annual variation in %)4.65.10.31.8-  
Consumption (annual variation in %)0.7-0.55.90.6-  
Investment (annual variation in %)-1.216.5-4.3-5.1-  
Industrial Production (annual variation in %)5.14.8-1.62.6-  
Unemployment Rate3.63.33.02.92.7
Fiscal Balance (% of GDP)-17.6-21.1-13.9-8.7-9.1
Public Debt (% of GDP)15.532.746.453.562.6
Inflation Rate (CPI, annual variation in %)0.11.11.60.90.1
Policy Interest Rate (%)1.001.191.952.93-  
Exchange Rate (vs USD)0.390.390.390.390.39
Current Account (% of GDP)-16.0-19.1-15.6-5.5-  
Current Account Balance (USD bn)-10.9-12.5-11.0-4.3-  
Trade Balance (USD billion)9.16.38.818.1-  
Exports (USD billion)35.627.532.841.7-  
Imports (USD billion)26.521.324.123.6-  
Exports (annual variation in %)-33.4-22.819.426.9-  
Imports (annual variation in %)-4.8-19.913.3-2.0-  
International Reserves (USD)17.520.216.117.416.6

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Oman Facts

Value Change Date
Exchange Rate0.390.06 %Dec 31

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