Oman's GDP grows by 1.3 percent

The Economy Ministry said Oman's Gross Domestic Product grew by 1.3 percent in 2023.

GDP in constant prices rose from 37.7 billion Omani riyals (OMR) at the end of 2022 to 38.2 billion OMR by the end of 2023.

The volume of GDP at current prices amounted to 41.8 billion Omani riyals during the past year, down by 2.8 percent compared to 2022.

Growth was supported mainly by the increase in the value of non-oil activities from 26.6 billion OMR in 2022 to 27.3 billion OMR at the end of last year, up 2.4 percent.

Oil activities were up by about 0.4 percent from 12.3 billion OMR in 2022 to 12.4 billion OMR in 2023.

The slight growth reflects the impact of developments in the global oil market and Oman’s commitment to the policy of reducing crude oil production in coordination with the OPEC Plus group to maintain the stability of the market and achieve a balance between the volume of supply and demand for oil.

The Ministry explained that within the priority of the economy and development in the first phase of Oman 2040, the implementation of the tenth five-year development plan would achieve progress in enhancing the path of economic diversification and the sustainability of the financial situation in the Sultanate.

National programmes also boosted the goals of the five-year plan and the fruitful results were achieved through national laboratories and clinics in solving challenges and identifying opportunities in various sectors as pillars of growth.

The Ministry said government efforts and initiatives provided an integrated system to encourage investment, support the private sector, achieve continuous improvement in the business environment and the rank of the Sultanate in all international indicators.

Oman achieved improved macroeconomic indicators and support for the economy’s solidity and flexibility as it continued the growth of the past three years.

During the past year, growth rates were good despite the global challenges in the oil market that led to a decline in oil production and a fall in prices from the high levels in 2022.

That showed the flexibility of the economy and its ability to continue growth, increasing the scope of economic diversification and the new opportunities available to enhance the attractiveness of investment in the Sultanate of Oman.

It is expected that the Omani economy will continue to grow this year and  next year in light of expectations of continued good levels of oil prices, good performance of non-oil activities and the constant development of new initiatives.

At the same time, a diverse package of projects were launched in number of sectors representing a major addition to the economic diversification efforts in the Sultanate. These included one of the largest strategic projects in the petrochemical and manufacturing industries sector, the Duqm Refinery.

Such developments supported the continuation of favourable conditions for sustainable growth enhanced by strong performance in the diversification sectors and an increase in the tributaries that support the growth of GDP. The most important of these were the new investments in industrial cities and free zones and the major agreements signed in green industries and green hydrogen which opened a promising new stream for sustainable growth.

This aligns with Oman’s goals to keep pace with the transformations taking place in global energy markets and to benefit from the interest in moving towards renewable and clean energy, achieving the Sultanate’s goals to reach zero carbon neutrality by 2050 and actively contributing to international efforts to reduce harmful emissions and contain the risks from climate change.

The Ministry stressed that the strategic directions to support economic diversification and achieve financial and economic sustainability position the private sector as a partner in development efforts, an engine for economic growth and a source for generating job opportunities.

Since the beginning of the current five-year plan, government efforts and initiatives have achieved tangible progress in attracting new investments, improving the attractiveness of investment in the Sultanate and expanding the role of the private sector through continuous development of the regulatory system for the economy.

Efforts to support the private sector continued through several government directions including the National Policy for Local Content, which represents an important shift in supporting the private sector and localising industry, and the privatisation plan by the Oman Investment Authority to pave the way for the private sector to lead economic growth and diversify investment options and opportunities.

The important initiatives put forward by the government include the launch of the Future Fund Oman at the beginning of this year as an initiative to finance private sector projects, startups, and small and medium enterprises and to attract investments that enhance economic diversification and support technology and innovation.

All of these positive developments contributed to maintaining the growth momentum and consolidating the path of diversification and sustainability financially and economically.

The Ministry said this enhanced Oman's tangible gains in directing the financial situation towards stability, strengthening the state’s financial position, reducing public debt to safe levels and the continuous improvement in the Sultanate's credit rating.