Oman’s GDP growth projected at 4.3% in 2022: IMF

Oman’s GDP growth projected at 4.3% in 2022: IMF

Overall GDP growth in Oman rebounded from -3.2% in 2020 to 3% in 2021 and is projected at 4.3% in 2022, supported by increased hydrocarbon production and continued recovery of non-hydrocarbon economic activity.

This is according to the Executive Board of the International Monetary Fund (IMF), which concluded the Article IV consultation with Oman and considered and endorsed the staff appraisal without a meeting.

High oil prices and fiscal consolidation under the authorities’ Medium-Term Fiscal Plan (MTFP), have improved fiscal and external balances considerably. The overall central government balance improved by 12.8 percentage points of GDP to a deficit of 3.2% in 2021, largely due to higher hydrocarbon revenue, expenditure restraint, and the introduction of VAT.

Fiscal and external surpluses

Fiscal and external surpluses are expected in 2022 and over the medium term. Central government debt declined to 62.9% of GDP in 2021 and it is expected to decline to about 44% of GDP in 2022.

The banking system has weathered the recent shocks relatively well. Financial soundness indicators appear healthy, benefiting from prudent oversight of the Central Bank of Oman and the strong buffers before entering the crisis. However, private sector credit growth has remained subdued, according to the IMF team.

The authorities remain committed