Oman Receives Praise from IMF for Economic Recovery
Muscat, The Gulf Observer: The Sultanate of Oman welcomes the positive assessment from the International Monetary Fund (IMF) in its 2023 Article IV Consultation Report, officially approved by the IMF’s Executive Board on Tuesday. The comprehensive report follows a series of consultations between IMF experts and over 20 government and private entities, representing an integral part of the annual periodic consultations.
At the heart of the IMF’s assessment is Oman’s ongoing economic recovery, buoyed by favorable oil prices and a sustained commitment to reforms. The report highlights the robust performance of Oman’s domestic economy, with a 4.3% growth in real GDP in 2022, propelled by both hydrocarbon and non-hydrocarbon sectors. Despite a temporary slowdown in the first half of 2023 due to OPEC+-related oil production cuts, non-hydrocarbon growth accelerated from 1.2% in 2022 to 2.7% in the first half of 2023. This growth is attributed to the recovery in agricultural, forestry, fisheries, and construction activities, along with a resilient services sector.
In terms of inflation, the report underscores Oman’s successful efforts in containing it, with inflation receding from 2.8% in 2022 to 1.2% during January-September 2023. Key contributors to this achievement include subsidies on essential food items, caps on domestic petroleum prices, and the peg to a robust US dollar.
The IMF report commends Oman’s prudent fiscal management, resulting in fiscal and current account balances turning into surpluses in 2022, coupled with a downward trajectory in the non-hydrocarbon primary deficit. The banking sector’s resilience is acknowledged, with profitability rebounding to pre-pandemic levels. The IMF stresses the importance of accelerating the implementation of Oman Vision 2040 reform plans to sustain and enhance these positive trends.
Oman’s commitment to economic recovery, fiscal responsibility, and comprehensive reforms is recognized by the IMF, reinforcing confidence in the nation’s economic trajectory.
