These are the reasons for the optimistic forecasts for the economy of the Sultanate of Oman

The IMF predicts that the public debt in the Sultanate of Oman will see questyear a sharp decline in gross domestic product to around 70%, after rising to around 81% due to domestic and foreign debt.

Jefferies International chief economist Alia Moubayed said in an interview with “Al Arabiya” that the economy of the Sultanate of Oman is sensitive to fluctuations in oil prices, and therefore benefited from the high rate of oil at $ 60.

And he revised a number of reasons for the expectations The Fund’s optimism on the Omani economyThe most relevant are the structural reasons linked to the policies pursued by the government through a serious restructuring of public finances, in terms of expenses and revenues, through the implementation of the value added tax, and the reduction of insignificant support for the deserving class. support, such as subsidies for electricity and water.

He also referred to the new rules for employment in the public sector of Oman and the decision to transfer from the state budget to the government budget much of the investment expenditure related to the oil and gas sector, which constitutes 6% of gross domestic product. the oil company of Oman.

He believes that these measures clearly contribute to reducing the size of budget deficits and reducing the pace of accumulation of public debt, which has risen to 81% of gross domestic product.

The International Monetary Fund predicted that the deficit and financial debt in the Sultanate of Oman would decrease dramatically, after increasing last year, thanks to the country’s implementation of a medium-term plan to reform its financial conditions, which were affected. from the “Covid -19” pandemic and drop in oil prices.

decline in the deficit

In a statement, the Fund expected the deficit would decrease to 2.4% of GDP questyear from 19.3% in 2020 and that the country would transform in a surplus next year.

“Central government debt has risen to 81.2% of GDP and funding needs have been covered by internal and external loans and asset withdrawals, but a sharp decline is expected in the medium term,” the statement said.

Since the collapse of the oil price in 2014, the debt-to-GDP ratio has risen from 15% in 2015 to around 80% last year.

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