Muscat – With Oman’s government finances improving on higher oil prices in 2021 and average oil prices likely to be much higher than the levels estimated in the 2022 budget, coupled with state incentives for businesses, there is a brighter outlook for the year ahead.

The price of Oman oil on Monday exceeded US$92. ‘Oman oil price (April 2022 delivery) was US$92.24, comprising an increase by US$1.35 from the price of last Friday, which was US$90.89,’ ONA stated.

To boost the economy, several government bodies have slashed or cancelled fees across more than 500 services offered to investors and members of the public. The move was part of an initiative to make Oman more competitive, strike a balance between the services and fees paid, rationalise government spending, streamline fee structure and improve the value of services offered to customers.

According to Redha bin Juma al Saleh, chairman of Oman Chamber of Commerce and Industry, implementation of the unified guide of service fees reduction, which has the blessings of His Majesty Sultan Haitham bin Tarik, will catalyse the business environment encouraging entrepreneurs and innovators to start business ventures.

“The unified guide will also attract foreign investment, in addition to raising the sultanate’s indi- cators of competitiveness and ease of doing business. We urge the private sector and business owners to contribute to strengthening the national economy and to take advantage of the simplified processes and procedures to avail government services to support the ongoing economic diversification efforts,” he said.

Oman’s budget deficit dropp-ed sharply to RO1.22bn (four per cent of GDP) in 2021, according to preliminary estimates, compared to a RO4.4bn (15.8 per cent of GDP) shortfall recorded in 2020. The main driver for reduction in the deficit was the improvement in oil and gas revenues last year. The deficit in the 2022 budget is estimated to be RO1.5bn and the Ministry of Finance (MoF) has affirmed that the most significant objective in drafting public spending estimates was to maintain spending on basic services like education, health, housing and social welfare.

Khalid al Busaidi, media and communications director in MoF, attributed the service fees reduction to an objective of helping the economy while noting that the move will have no impact on government revenues. “Service fees have been reduced by 17 to 96 per cent across various sectors.”

Oman’s labour market has been established as a key sector supporting the economy and in 2021, as many as 40,000 Omanis were employed limiting the total number of jobseekers in the range of 50,000. Dr Mahad bin Said bin Ali Ba’owain, Minister of Labour, said recently, “We are working around the clock to ensure that jobseekers get the right placement.”

He also noted that the government is not inclined to “pressurise the private sector by asking them to raise minimum wage because that would affect employment figures. Instead of hiring three Omanis, companies would hire only one”.