Oman’s Sultan Haitham Bin Tarik has approved the country's fiscal plans for the next four years that will see it cut back on government spending and reduce national debt, the Oman News Agency (ONA) reported on Thursday.
The royal decree set rules for the financial sustainability of the Sultanate and will also focus on diversifying the economy to reduce its reliance on hydrocarbons as part of its efforts to boost the state’s financial reserves.
The decree is aims to improve investment returns from government assets to offset low oil prices and their impact on economic growth, ONA reported.
The Sultan's order also included 371 million rials ($964.8 million) for the development of regional towns.
Since succeeding the late Sultan Qaboos bin Said on January 11, Sultan Haitham has rolled out various measures to cope with the economic fallout from the coronavirus pandemic and low oil prices to stimulate the economy, including introducing a five per cent value-added tax (VAT), which will begin in the second quarter of 2021.
In August, the Sultan ordered all civil servants who had completed 30 years of service to be retired as part of the government's cost-saving measures.
He also reshuffled the cabinet last month and streamlined civil ministries from 26 to just 19 for a leaner and more efficient government.
On Wednesday, it raised $2 billion in its first international bond sale since July 2019.
However, economists say the government needs to wean itself off oil income to offset the fiscal deficit.
“Oman has been talking about a diversification programme for many years but little has been done about it. It simply cannot depend on oil income alone. Privatisation is the way forward here,” economist Khalid Al Sabahi said.
The Sultanate based its 2020 fiscal budget on oil trading at $58 per barrel. However, with crude currently trading at about $42 per barrel, the government is preparing for a deficit of 2.5 billion rials in 2020, slightly lower than the 2.8 billion rials projected in the 2019 budget.
Coronavirus has also hit the country’s tourism industry hard. In 2019, Oman received more than three million tourists compared with fewer than 200,000 this year. It also cancelled the Khareef festival in the southern city of Salalah, one of the major tourist attractions in the country.
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At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances
Asia Cup Qualifier
Final
UAE v Hong Kong
TV:
Live on OSN Cricket HD. Coverage starts at 5.30am
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Countries offering golden visas
UK
Innovator Founder Visa is aimed at those who can demonstrate relevant experience in business and sufficient investment funds to set up and scale up a new business in the UK. It offers permanent residence after three years.
Germany
Investing or establishing a business in Germany offers you a residence permit, which eventually leads to citizenship. The investment must meet an economic need and you have to have lived in Germany for five years to become a citizen.
Italy
The scheme is designed for foreign investors committed to making a significant contribution to the economy. Requires a minimum investment of €250,000 which can rise to €2 million.
Switzerland
Residence Programme offers residence to applicants and their families through economic contributions. The applicant must agree to pay an annual lump sum in tax.
Canada
Start-Up Visa Programme allows foreign entrepreneurs the opportunity to create a business in Canada and apply for permanent residence.
The 12 Syrian entities delisted by UK
Ministry of Interior
Ministry of Defence
General Intelligence Directorate
Air Force Intelligence Agency
Political Security Directorate
Syrian National Security Bureau
Military Intelligence Directorate
Army Supply Bureau
General Organisation of Radio and TV
Al Watan newspaper
Cham Press TV
Sama TV
How The Debt Panel's advice helped readers in 2019
December 11: 'My husband died, so what happens to the Dh240,000 he owes in the UAE?'
JL, a housewife from India, wrote to us about her husband, who died earlier this month. He left behind an outstanding loan of Dh240,000 and she was hoping to pay it off with an insurance policy he had taken out. She also wanted to recover some of her husband’s end-of-service liabilities to help support her and her son.
“I have no words to thank you for helping me out,” she wrote to The Debt Panel after receiving the panellists' comments. “The advice has given me an idea of the present status of the loan and how to take it up further. I will draft a letter and send it to the email ID on the bank’s website along with the death certificate. I hope and pray to find a way out of this.”
November 26: ‘I owe Dh100,000 because my employer has not paid me for a year’
SL, a financial services employee from India, left the UAE in June after quitting his job because his employer had not paid him since November 2018. He owes Dh103,800 on four debts and was told by the panellists he may be able to use the insolvency law to solve his issue.
SL thanked the panellists for their efforts. "Indeed, I have some clarity on the consequence of the case and the next steps to take regarding my situation," he says. "Hopefully, I will be able to provide a positive testimony soon."
October 15: 'I lost my job and left the UAE owing Dh71,000. Can I return?'
MS, an energy sector employee from South Africa, left the UAE in August after losing his Dh12,000 job. He was struggling to meet the repayments while securing a new position in the UAE and feared he would be detained if he returned. He has now secured a new job and will return to the Emirates this month.
“The insolvency law is indeed a relief to hear,” he says. "I will not apply for insolvency at this stage. I have been able to pay something towards my loan and credit card. As it stands, I only have a one-month deficit, which I will be able to recover by the end of December."
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3. Large black holes can also be formed when smaller ones collide and merge
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5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
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Our legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
Real estate tokenisation project
Dubai launched the pilot phase of its real estate tokenisation project last month.
The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.
Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.
Remaining fixtures
- August 29 – UAE v Saudi Arabia, Hazza bin Zayed Stadium, Al Ain
- September 5 – Iraq v UAE, Amman, Jordan (venue TBC)
