Oman's economic resilience testament to strategies of Vision 40
14/11/23
Oman’s continued strong economic performance demonstrates the Sultanates robust economic policies and strategic Vision 40 according to a recent Allianz Trade report.
The country`s economy has shown remarkable resilience backed up by a fiscal surplus of 8% of GDP in 2022, which is an important indicator of its financial management.
Furthermore, Oman`s approach has been to mitigate the impact of rising commodity prices through targeted and well-planned policy responses. This reflects the country’s progressive subsidy reform journey.
In addition, the introduction of a new labour law in July 2023, which incentivises the hiring of Omani nationals in the private sector, is a strategic move to reduce reliance on expatriate labour and boost national employment. This is particularly important as Oman, like its regional peers, strives to balance the need for economic diversification with creating job opportunities for its citizens.
Economically, Oman’s reliance on hydrocarbons is being strategically managed. Accounting for approximately 35% of GDP, the energy sector remains significant, but economic diversification is yielding tangible results. The petrochemical project expansion and the landmark LNG deal with Germany signify Oman’s commitment to broadening its economic base and ensuring sustainable growth.
Most importantly, the banking sector in Oman has rebounded and the sector is well-positioned to support economic growth and avoid global financial shocks.
In the same vein, Infrastructure development, a key driver of economic diversification, is seeing significant investment. New roads, rail, and port projects are not only enhancing domestic connectivity but also integrating Oman with the economies of the Gulf. These projects are essential for the growth of the logistics sector and are a strategic complement to the nation’s broader economic development goals.
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