Muscat – Oman’s development expenditure rose 16% to RO798mn in the first half of 2026, as the government accelerated spending on projects and economic transformation initiatives while directing RO2.706bn towards social sectors and basic services.

Development spending was up from RO688mn in the same period of 2025 and represented 61% of the RO1.3bn allocated for the full year, according to the Ministry of Finance’s Fiscal Performance bulletin for the second quarter.

The 2026 development budget comprises RO900mn for projects implemented by government units and RO400mn for economic transformation projects. By the end of June, RO146mn had been spent on economic transformation initiatives.

The dedicated RO400mn annual allocation for economic transformation projects is a new feature of the 11th Five-Year Plan (2026-2030), aimed at financing initiatives with tangible economic returns and supporting diversification.

Development expenditure covers projects intended to strengthen infrastructure, improve public services and enhance the competitiveness of the national economy. During the previous Five-Year Plan covering 2021-2025, actual development expenditure totalled RO6.936bn across sectors including education, health, housing, roads, tourism, water resources and governorate development.

Alongside project spending, the government allocated substantial resources to social sectors and essential services during the first half.

Spending on these areas reached RO2.706bn by the end of June. Education accounted for the largest share at 39%, while health, and security and social welfare each represented 26%. Housing accounted for the remaining 9%.

The Ministry of Finance said continued financing of development and economic transformation projects supports the priorities of the 11th Five-Year Plan and Oman Vision 2040.

Overall, public revenue rose 13% year on year to RO6.602bn in the first half, while expenditure increased 9% to RO6.619bn, leaving a fiscal deficit of RO17mn.

Average realised oil prices stood at US$74 a barrel, while average oil production was 1.074mn barrels per day.