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RO936mn actual surplus recorded in 2023 budget

2 Jun 2024 RO936mn actual surplus recorded in 2023 budget By OUR CORRESPONDENT

Muscat – Oman’s general budget recorded a significant turnaround in 2023, achieving an actual surplus of RO936mn for the year compared to an initially estimated deficit of RO1.3bn, according to the Final Accounts 2023 bulletin published by the Ministry of Finance on Sunday.

This surplus was largely driven by higher-than-anticipated oil and gas revenues during 2023.

The Ministry of Finance stated that the government allocated this additional RO936mn revenue earned in 2023 towards a liability management exercise and reducing public debt, while also focusing on enhancing social spending and boosting economic growth. These strategic financial efforts improved Oman’s overall financial and economic standing, positively impacting its credit ratings.

As a result of the repayment of debt last year, Oman’s total public debt decreased by RO2.3bn, from RO17.6bn in 2022 to RO15.3bn at the end of 2023.

25% revenues growth

Oman’s actual general revenues substantially increased – 25% – in 2023 to RO12.542bn compared to the budgeted RO10.05bn. This revenue surge was primarily attributed to a significant rise in hydrocarbon as well as non-hydrocarbon revenues, according to the Ministry of Finance.

Net oil revenue generated RO7.150bn in 2023, a sharp 34% increase compared to the RO5.320bn approved in the 2023 budget. Oil revenues accounted for 72% of the total public revenues in 2023.

‘This growth is largely attributed to the rise in average oil prices in international markets, hitting US$82 per barrel, significantly higher than the US$55 per barrel price approved in the 2023 budget,’ the ministry stated.

Gas revenue at the end of 2023 amounted to RO1.868bn, marking a 33% increase compared to the RO1.4bn budgeted estimate.

Meanwhile, non-oil revenue reached RO3.524bn at the end of 2023, showing a 6% growth compared to the approved figures in the 2023 budget. Non-oil revenue constituted 28% of the total public revenue in 2023, with a notable increase in companies’ income-tax and Value-Added Tax (VAT) contributions.

On the other hand, current revenue in 2023 reached RO3.5bn, registering a 7% increase compared to the RO3.280bn budgeted for 2023.

Spending increases to RO11.6bn

Actual expenditures slightly increased – 2% – to RO11.606bn in 2023, compared to the budgeted amount of RO11.350bn. This increase, the Ministry of Finance stated, reflects the government’s focus on augmenting social spending, supporting economic growth, increasing hydrocarbon product subsidies, and raising spending on development projects.

Current expenditures experienced a marginal decline of 1%, standing at RO8.554bn in final accounts, compared to the RO8.620bn budgeted.

Total expenditure on development projects undertaken by ministries and civil units witnessed a substantial increase of 24% in 2023 to RO1.363bn compared to the budgeted amount.

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