Oman Economic Forecast

Oman Economic Outlook

November 3, 2020

The economy likely recovered in Q3, after Covid-19 restrictions weighed on activity in Q2. Despite daily crude oil output and energy exports averaging lower in Q3 than in Q2, natural gas production hit record highs. Turning to the non-energy sector, some restrictions were loosened in Q3, while labor market conditions improved in September, which likely benefited domestic demand. In other news, in October, the government received USD 1 billion in financial support from Qatar and announced plans to implement a 5% VAT by April 2021 at the latest. Authorities will also tap global debt markets with a USD 2 billion bond sale in a bid to shore up government finances, as Covid-19’s impact on oil markets has weakened external balances. Meanwhile, S&P Global Ratings downgraded Oman’s credit rating in October—for the second time this year—from BB- to B+, citing the dire state of public sector finances.

Oman Economic Growth

Next year, the economy should rebound as the impact of the pandemic fades and external demand returns. That said, economic reforms and austerity measures, coupled with the decision to implement a 5% VAT tax, will likely cap the rebound in domestic demand. FocusEconomics Consensus Forecast panelists foresee the economy growing 2.5% in 2021, which is down 0.3 percentage points from the previous month’s forecast. In 2022, our panel expects GDP to grow 3.5%.

Oman Economy Data

2015 2016 2017 2018 2019
Population (million)
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 %)  
Consumption (annual variation in %)0.7-  
Investment (annual variation in %)-1.216.5-4.3-5.1-  
Industrial Production (annual variation in %)5.14.8-1.62.6-  
Unemployment Rate3.
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 %)
Policy Interest Rate (%)  
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)  
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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