Muscat – The Central Bank of Oman (CBO), on behalf of the sultanate’s government, has announced the launch of a new government development bonds issue, valued at RO100mn.

The bonds, set for a five-year maturity, will offer a coupon rate of 4.60% per annum, according to a statement released by the CBO. Subscription opens on February 9 and will run through to February 13, 2025. The auction for the issue will take place on February 16, 2025, with the issue date slated for February 18, 2025.

Interest on the bonds will be paid semiannually, on February 18 and August 18, through to the bonds’ maturity on February 18, 2030.

The 73rd issue of government development bonds is open to all investors, including both residents and non-residents, regardless of nationality. The bonds will be offered exclusively through a competitive bidding process. Interested parties can place bids through commercial licensed banks in Oman during the subscription period.

Investors placing bids for RO1mn or more may also submit their bids directly to the CBO, provided they obtain bank endorsements.

These bonds are direct, unconditional obligations of the Omani government and can be used as collateral for loans with local banks. They will also be tradable on the Muscat Stock Exchange (MSX), with the details of allocations recorded by Muscat Clearing & Depositary Company (MCD).

Oman’s government plans to issue government development bonds and sovereign local sukuk worth RO750mn this year. The planned local market issuances are part of the government’s strategy to meet financing requirements, covering both a projected budget deficit and public debt servicing.

The government will raise the total RO750mn from the local market through eight issues of government development bonds worth RO550mn and two issuances of sovereign local sukuk worth RO200mn, according to details outlined in the Ministry of Finance’s 2025 budget guidance.

The ministry has designed the borrowing plan for 2025 based on estimates outlined in the State’s General Budget for 2025. This includes projections for public debt, financing needs, and the financing structure for the year ahead.

Total financing requirements for 2025 are projected at RO2.454bn, which includes a budget deficit of RO620mn and RO1.834bn needed for debt servicing. The government intends to cover these requirements through a combination of local borrowing (RO750mn), external borrowing (RO1.304bn), and a withdrawal from reserves (RO400mn).

For 2025, issuances of government development bonds are planned for February (RO100mn), April (RO100mn), June (RO60mn), July (RO60mn), August (RO60mn), September (RO60mn), October (RO60mn), and December (RO50mn).

In addition, two issuances of local sovereign sukuk are scheduled for May (RO100mn) and November (RO100mn).