Latest news with #TenthFive-YearPlan
Observer
12-07-2025
- Business
- Observer
Oman forecasts 2.2% economic growth in 2025
MUSCAT: Oman's economy is expected to grow by 2.2% in real terms by the end of 2025, up from 1.7% in 2024, according to the Ministry of Economy's 'Economic Forecasts for 2025' report, marking the final year of the Tenth Five-Year Plan. Inflation is projected to reach around 1.3%, remaining within the plan's target range, thanks to government subsidies and stable global commodity prices. The GDP at constant prices is forecast to rise from RO 38.3 billion in 2024 to RO 39.2 billion by the end of this year, supported by a 1.3% rebound in oil activities. Oil's GDP contribution is expected to edge up to RO 12 billion, while non-oil sectors are projected to grow by 2.7%, contributing RO 28.6 billion. Looking ahead, growth is expected to continue through 2026 and 2027, driven by strategic projects and higher oil production. However, global uncertainty persists. The IMF downgraded its 2025 global growth forecast from 3.3% to 2.8%, citing rising protectionism and demand shifts. It also trimmed growth projections for advanced economies to 1.4%, and for emerging markets to 3.7%, largely due to slowing Chinese exports, real estate pressures, and weak consumption. Despite this, MENA's outlook remains relatively positive, with regional growth set to reach 3% in 2025, driven by recovering GCC economies and growing non-oil investments in diversification and renewables. Trade policy changes in the US are a potential risk. Washington's planned 10% tariff on all imports, plus additional "reciprocal" duties on around 90 countries, may impact global trade flows. Although GCC states may see minimal direct impact, indirect effects such as supply chain disruptions and oil price volatility could pose challenges. For Oman, the US remains a key trading partner, with historical data showing a US trade surplus except during 2020-2022. New global tariffs could still indirectly affect Oman through shifts in partner markets and weaker global oil demand. Rising US inflation may also delay interest rate cuts, potentially increasing imported inflation for Oman. Nonetheless, Oman's strategic location, robust infrastructure, and free zones position it well to benefit from shifting global supply chains. Re-exports and foreign investment in economic zones could increase, especially as European firms consider relocating operations in response to tariff changes. — ONA
Observer
06-07-2025
- Business
- Observer
Inflation in Oman remains moderate at 0.81%
MUSCAT: Average inflation in the Sultanate of Oman stood at 0.81 per cent during the first five months of 2025, compared to the same period in 2024, according to data from the Ministry of Economy based on the Consumer Price Index (CPI). This relatively moderate inflation rate coincided with a 1.3 per cent increase in the general import price index and a 4.1 per cent rise in the general producer price index by the end of Q1 2025. Inflation trends varied across the governorates. Ad Dakhiliyah recorded the highest rate at 1.58 per cent, followed by Musandam (1.51%), South Al Sharqiyah (1.24%), Al Dhahirah (1.09%), and Al Wusta (1.06%). Meanwhile, inflation declined slightly in South Al Batinah (-0.04%) and remained lowest in North Al Sharqiyah (0.21%) and North Al Batinah (0.42%). The remaining governorates saw inflation below 1 per cent. Dr Salem bin Abdullah al Sheikh, the Ministry's official spokesperson, attributed the subdued inflation to a drop in food and non-alcoholic beverage prices, along with price stability in the housing, water, electricity, gas, and fuels segment. These two groups represent over half of the consumer spending basket in Oman. Between January and May 2025, prices of food and non-alcoholic beverages dropped by 0.17 per cent compared to the same period in 2024. Specific food categories saw significant decreases, including vegetables (-4.63%), fish and seafood (-3.69%), meat (-0.13%), non-alcoholic beverages (-0.11%), and bread and cereals (-0.01%). However, prices increased for sugar, jam, honey, and sweets (+3.13%), dairy products and eggs (+2.88%), oils and fats (+1.28%), fruits (+1.05%), and other food items (+3.40%). The highest inflation among all categories was seen in the miscellaneous goods and services group, which rose by 6.04 per cent. Other notable increases were in health (+2.71%), transport (+2.68%), and restaurants and hotels (+1.08%). Prices for tobacco and communications remained largely stable, with marginal changes in the remaining CPI categories. Dr Al Sheikh highlighted that the stability in food prices reflects the slower pace of global price increases and the continued implementation of government subsidies for essential goods and services. Additionally, Oman's ongoing improvements in food production, supply chains, and marketing are supporting the country's food security strategy and goals under the Tenth Five-Year Plan (2021–2025). Agriculture and fishing—key components of food security—grew by 2.8 per cent in 2024, contributing RO 987 million to the GDP at constant prices. In the first quarter of 2025, this growth accelerated to 7.6 per cent, with a contribution of RO 273.6 million. To support this growth, Oman has continued to invest in infrastructure supporting food supply and trade across governorates. Over 80 projects—including markets, slaughterhouses, and retail outlets—were implemented under the Governorate Development Program from 2021 to 2024. Current projects include the Shaleem slaughterhouse, the Mawarid Market in Sinaw, an agricultural products centre in Dhofar, a fisheries and food industries complex in Duqm, and a cold chain facility also in Duqm. The 'Silal' Central Market in Khazaen Economic City has also been inaugurated, acting as a key hub for fresh produce distribution. Globally, the Food and Agriculture Organization (FAO) reported a 6.0 per cent year-on-year increase in its Food Price Index (FPI) in May 2025, though the index declined by 0.8 per cent from April to May. Dairy and meat prices rose, while prices for cereals, sugar, and vegetable oils fell. Dr Al Sheikh concluded by warning that if trade protectionism worsens, global inflation could rebound—potentially undermining the progress made by central banks worldwide in curbing inflationary pressures. — ONA
Observer
26-06-2025
- Business
- Observer
Oman receives RO 30 billion FDI
MUSCAT: Oman received nearly RO 30 billion by the end of 2024 due to simplification of procedures through the Oman Business Platform, which processed over 800,000 transactions in 2024 and added 24 digital services. Speaking during a session of the Majlis Ash'shura on Wednesday, Qais bin Mohammed al Yousef, Minister of Commerce, Industry and Investment Promotion, reviewed the ministry's ongoing initiatives in industrial growth, investment attraction and digital transformation. Discussions covered the contribution of public and private sectors to Oman's gross domestic product, evaluations of free trade agreements and updates on the Nazdaher programme. To combat "hidden trade" and ensure fair competition, the ministry has enforced measures including mandatory electronic payment methods for commercial activities, aligning with global trends in the digital economy. A ministerial decision was also issued to enhance corporate governance standards for closed joint-stock companies, said the minister. The minister stated that the trade sector's contribution to GDP at constant prices reached approximately 8.3 per cent in 2024, amounting to RO 3.225 billion, with a cumulative growth rate of 6.6 per cent during the Tenth Five-Year Plan. He added that the manufacturing sector recorded the highest growth rate among economic diversification activities, at 8.6 per cent, reaching RO 3.6 billion at constant prices by the end of 2024 — constituting 10 per cent of GDP. He highlighted that industrial exports reached RO 6.2 billion in 2024, reflecting the growing added value of national industries. He noted that over 260 initiatives are currently being implemented in collaboration with partners and stakeholders as part of the Industrial Strategy 2040. The minister revealed that the number of Omani standard specifications issued by the ministry by the end of 2024 totalled 7,523, with 17 technical services streamlined. Additionally, the Invest Oman platform received around 90 investment requests worth RO 5.38 billion between its launch in February 2023 and June 2025, with 43 projects worth RO 2.25 billion localised in strategic sectors such as industry, healthcare, food security and renewable energy. He further added that the ministry has bolstered community participation in the local economy through initiatives supporting consumer cooperatives, including regulatory incentives such as streamlined registration and commercial site allocation. In e-commerce, new regulations were introduced, and the Ma'roof Oman platform was launched to certify online stores, boosting consumer trust and increasing licenses by 236.4% within a year. Al Yousef pointed out that key programmes launched include the Industrial Observatory to monitor sector performance and optimise supply chains, the Automation and AI Programme to modernise factories, Tasneea to localise procurement, and Ta'meer to link major urban projects like Sultan Haitham City with local products — fostering economic integration. BOX GRAPH POINTS 1. Trade sector's contribution to GDP at constant prices reached approximately 8.3 per cent in 2024, amounting to RO 3.225 bn 2. Industrial exports reached RO 6.2 billion in 2024, reflecting the growing added value of national industries 3. 260 initiatives are currently being implemented in collaboration with partners and stakeholders as part of the Industrial Strategy 2040 4. Invest Oman platform received around 90 investment requests worth RO 5.38 billion between its launch in February 2023 and June 2025
Observer
25-06-2025
- Business
- Observer
Manufacturing sector accounts for 10% of Oman's GDP in 2024: MoCIIP
Muscat: Majlis Ash'shura held its 13th regular session of the second annual sitting of the 10th term on Wednesday, during which Qais bin Mohammed al Yousef, Minister of Commerce, Industry and Investment Promotion (MoCIIP), presented his ministry's statement. The session focused on several key topics, including the contribution of the public and private sectors to the Gross Domestic Product (GDP), the assessment of free trade agreements, and progress under the "Nazdahir" programme. In his address to the council, the minister said the trade sector's contribution to the GDP at constant prices reached 8.3 per cent in 2024, amounting to RO 3.225 billion. He noted that the sector recorded a cumulative growth of 6.6 per cent during the Tenth Five-Year Plan. "The manufacturing sector registered the highest growth among economic diversification activities, achieving an 8.6 per cent increase to reach RO 3.6 billion at constant prices by the end of 2024. This represents 10 per cent of the GDP", he further added. He added that the industrial exports stood at RO 6.2 billion in 2024, he added, highlighting the growing added value of national industries and their ability to access regional and global markets.
Muscat Daily
24-06-2025
- Business
- Muscat Daily
Income Tax key step for revenue diversification: Economy Minister
Muscat – The Ministry of Economy affirmed that the implementation of the Personal Income Tax (PIT), set to take effect at the beginning of 2028, represents a crucial step toward enhancing financial stability and completing the fiscal sustainability framework. This measure aims to ensure sustainable financing for development across various sectors. H E Dr Said Mohammed al Saqri H E Dr Said Mohammed al Saqri, Minister of Economy, stated: 'The tax serves as a new revenue stream to diversify public income sources and mitigate risks associated with reliance on oil as the primary revenue source. It will help maintain current levels of social and service spending while preserving Oman's achievements in financial and economic stability under 'Oman Vision 2040' and its first executive phase, the Tenth Five-Year Plan (2021-25).' He explained that the PIT is a fiscal tool adopted by most countries worldwide as a key revenue source to fund state-provided services. Over 190 countries impose this tax, and in many, income taxes constitute the largest component of total tax revenues at federal and local levels, financing public goods and services. He noted that implementing the tax in Oman will yield significant economic benefits, supporting income diversification strategies and long-term fiscal stability as a pillar of economic growth. It, he added, will also sustain government revenues, strengthen the state's financial position, maintain credit ratings, and boost spending power for beneficiaries – directly stimulating aggregate demand and economic growth. He highlighted that oil and gas revenues account for 68% to 85% of Oman's total public income, depending on global energy prices. While oil prices have stabilised at favourable levels in recent years, they remain volatile. Oman has effectively managed additional oil revenues by reducing public debt to safe GDP ratios, increasing investment and social spending, and subsidizing essential goods and services, he further noted. He affirmed that government policies and initiatives have successfully shifted Oman's fiscal and economic trajectory toward sustainability and stability. Public debt has sharply declined, credit ratings have consistently improved to investment-grade levels, and Oman's standing in global competitiveness indices has risen. The Tenth Five-Year Plan sustained GDP growth near target rates, while economic diversification policies attracted quality investments and drove non-oil sector growth beyond expectations, the minister said. He added: 'As the Tenth Plan nears completion, Oman has advanced significantly in economic diversification and fiscal sustainability. The PIT will further prioritise financial stability by diversifying revenue sources – a strategic necessity to ensure equitable wealth distribution, enhance public services, strengthen social protection systems, and mitigate risks from global energy market fluctuations and other economic variables.' He emphasised that accelerating 'Oman Vision 2040' and its economic diversification strategy – transitioning to a knowledge- and technology-driven economy – requires sustainable funding for long-term planning. The Vision targets strategic investments in education, human capital, advanced infrastructure, innovation, and diversified sectors, alongside essential services and social protection. He pointed out that the 2025 budget allocates over RO5bn (39% to education, 24% to health, 28% to social protection) to these sectors, with the Social Protection Fund benefiting over 2mn people monthly as a key mechanism for household financial stability. As for the potential economic impacts, He noted that the tax study assessed effects on GDP and 18 economic sectors, concluding minimal impact (under 1%) due to high exemption and low tax rates. Foreign investment is expected to remain unaffected, as the tax applies to individuals – not corporate entities – and Oman's rates remain competitive globally, the minister concluded.
