Oman posted a budget deficit of RO198.3mn for the first five months of 2020 as low oil prices hurt the sultanate’s hydrocarbon revenues amid the coronavirus pandemic which has significantly reduced global oil demand this year.
However, the sultanate’s government managed to reduce the deficit by nearly 45 per cent during the January–May period this year from RO358.4mn deficit recorded in the same period of 2019, according to the figures released on Sunday by the National Center for Statistics and Information (NCSI).
Affected by lower oil prices and the COVID-19 pandemic, the sultanate’s total revenues decreased by 7.2 per cent to RO4.376bn in the first five months of 2020 against RO4.716bn in the same period a year ago.
Net oil revenue dropped 4.2 per cent to RO2.418bn this year compared to RO2.524bn in 2019, while gas revenue plunged 22 per cent to RO606.1mn during the January–May period of 2020 against RO777.2mn in the same period of 2019.
As the private sector companies have been hit hard by the virus outbreak and the shutdown of economic activities, the government’s revenue from corporate income tax also sharply fell by 32.2 per cent. The revenue from corporate income tax came at RO348.7mn in the first five months of 2020 compared to RO514.4mn in the corresponding period of last year.
The government’s income from customs duties increased 2.8 per cent to RO86.7mn in the January–May period of 2020, while revenues from other sources grew 15.1 per cent to RO901mn during the same period.
On the spending side, Oman’s total public expenditure was reduced by 9.9 per cent in the first five months of this year at RO4.574bn compared to RO5.074bn in the same period of 2019. Earlier this year, the government had announced to reduce and rationalise the budget spending after the COVID-19 outbreak hit the global oil demand and prices.
Of the total expenditure, the sultanate’s current expenditure decreased 5.5 per cent to RO3.385bn, while investment expenditure fell 23.7 per cent to RO662.6mn this year.
Within the current expenditure, the spending by civil ministries decreased 5.8 per cent to RO1.658bn in the first five months of 2020. The sultanate’s spending on defence was 14.7 per cent lower at RO1.084bn during the first five months of this year compared to RO1.271bn in the same period of 2019.
Oil production expenditure decreased 4.5 per cent to RO269.9mn, while gas production expenditure increased 4.2 per cent to RO176.8mn.
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