Monday 25 / November / 2024
Muscat: The total estimated revenues of the state’s general budget for the fiscal year 2024 is estimated to be OMR11.010 billion, constituting an increase of 9.5 percent compared to the estimated revenues for 2023, the Ministry of Finance announced on Monday.
The estimated revenues for Oman’s 2024 budget are calculated based on an assumed oil price of $60 per barrel, this was stated during the media briefing held by the Ministry of Finance.
The total public spending for the state’s general budget for 2024 was estimated at OMR11.650 billion, constituting an increase of 2.6 percent over the estimated public spending for 2023. The total public expenditure includes debt servicing cost, which stands at about OMR1.050 billion.
The budget deficit was estimated at approximately OMR640 million, representing 6 percent of total revenues and 1.5 percent of the gross domestic product (GDP).
Sultan Salim Al Habsi, Minister of Finance, explained that the state’s general budget for the fiscal year 2024 takes into account the balance between a set of determinants and priorities while continuing to pay the public debt and reducing it as much as possible.
He added that the 2024 state budget aims to improve the business environment and expand the participation of the private sector in the economic development, in addition to supporting the social aspect by enabling the Social Protection Fund to play its desired role as an umbrella for initiatives aimed at upgrading the level of insurance coverage and social protection for citizens, as well as maintaining the level of spending in basic services, such as education, health and housing.
The minister said in his speech that oil revenues in the 2024 budget constitute 54 percent of total revenues, while the gas sector’s contribution amounts to 14 percent and non-oil revenues represent 32 percent of total public revenues.
He added that estimating these public revenues comes within the framework of the precautionary approach to reduce the burden of any financial challenges that may arise during the fiscal year 2024 and ensure that financing needs are met in the event of a decline in oil prices.
The minister pointed out that the total financing needs for the fiscal year 2024, based on the oil price approved in the budget, will stand at OMR2.2 billion, including the deficit and loan instalments expected to be repaid during this year.
The Minister of Finance noted that the ratio of public debt to the GDP stood at about 35 percent, lower by 50 percent by the end of 2023 than the ratio it reached at its peak in 2020, when it stood at about 70 percent of the GDP.
The Minister of Finance explained that the financial surpluses achieved as a result of the rise in oil prices were utilised to implement a solid plan according to which a large percentage of the debts were paid, in addition to implementing a number of postponed development projects.
This was reflected in the projects of the 10th Five-Year Plan, whose commitments increased from OMR5 billion as it was at the beginning to more than OMR8 billion by the end of 2023. Priority was given to projects with a social dimension, such as education, health and social housing projects.
He pointed out that the total sums approved for these sectors in the 2024 budget stood at OMR4.635 billion, representing 40 percent of the total spending.
The minister stated that the government measures taken during the last period were met by credit rating agencies with a series of positive credit rating reports. This contributed to mitigating the increase in interest rates that were supposed to be paid on loans. The total amounts paid for debt service from 2020 until the end of 2023 stood at OMR4.062 billion.
Al Habsi said, “In order to achieve the objectives of the 10th Five-Year Plan to realise “Oman Vision 2040”, and within the framework of the policy of supporting economic diversification sectors and encouraging the establishment of projects that contribute to this diversification, and linking this approach to governorate development projects, financial allocations were provided.
These allocations consisted of raising the capital of Oman Development Bank to OMR500 million, raising the maximum lending limit from OMR1 million to OMR5 million, and providing a room to exceed this limit for development projects that add value to the local economy in the governorates of the Sultanate of Oman, in addition to launching a specialised investment fund Oman Future Fund with a capital of OMR2 billion.”
The minister affirmed that a programme called ‘Iskan’ or ‘Housing’ will be launched with a total value of up to OMR1.9 billion, with the prime aim of accelerating the pace of granting loans through Oman Housing Bank.
