Muscat – The Ministry of Finance expects Oman’s economy to achieve a growth of at least 3% during 2024 while continuing to maintain annual inflation at moderate levels.

The ministry announced the state budget for the fiscal year 2024 last week, aiming to sustain financial, economic, and social stability in line with the Financial Framework of the 10th Five-Year Development Plan (2021-2025) and Oman Vision 2040.

‘The 2024 budget is meticulously crafted to achieve a comprehensive array of economic and social objectives, including economic growth of at least 3% at constant prices during 2024 and maintaining inflation rates at moderate levels, around 3%,’ the Ministry of Finance stated in the 2024 budget statement.

Preliminary results of the fiscal year 2023 indicate a growth of real GDP by 2.3% for 2023, with GDP reaching RO43.7bn by the end of 2023, the ministry noted in the statement.

National Center for Statistics and Information (NCSI) data reveals that GDP growth at constant prices, by the end of Q3 2023, stood at approximately 2%, amounting to RO26.433bn compared to RO25.915bn in the same period of 2022.

This growth is mainly attributed to an increase in the value-added of non-oil activities by 2.7%, amounting to RO18.190bn by the end of Q3 2023, compared to RO17.704bn registered in the same period of 2022.

Meanwhile, the value-added of oil activities at constant prices witnessed a growth of 0.5% by the end of Q3 2023, amounting to approximately RO9.068bn compared to RO9.02bn registered over the same period in 2022.

International institutions such as the International Monetary Fund (IMF), World Bank, and global credit rating agencies earlier estimated that Oman’s 2023 economic growth will remain significantly lower than the previous year, mainly due to an expected decrease in oil output owing to an OPEC+ agreement, of which Oman is a member.

The estimated revenues for Oman’s 2024 budget are calculated based on an assumed oil price of $60 per barrel and an average daily oil production of 1.031mn barrels per day.

The IMF recently stated that Oman’s economic outlook remains favorable. ‘Supported by favorable oil prices and sustained reform momentum, Oman’s economic recovery continues, and inflation remains contained.’

Regarding inflation rate, the most recent data released by the NCSI indicates that the inflation rate in Oman declined to 1.03% by the end of November 2023 compared to 2.87% in the same period in 2022. This figure is deemed moderate compared to global inflation indicators.

‘It is anticipated that the inflation rate will persist at around 1% over the medium term. The government carried out several interventions aimed at curbing inflation, particularly through subsidies on food and fuel products,’ the Ministry of Finance said.