Budget 2022: Revenues estimated to increase 6%

Muscat: The total public revenues of the state for the fiscal year 2022 have been estimated at RO10.58 billion, an increase of six percent over what is expected to be collected by the end of 2021.

It was revealed in the press briefing held on Sunday to share the details of the National Budget 2022 by the Minister of Finance, Sultan bin Salem bin Saeed al Habsi.

Revenues from the oil and gas revenues will constitute 68 percent, compared to 32 percent contribution from non-oil sectors.

The estimated deficit for 2022, based on the price of $50 per barrel, will be around about RO1.5 billion, representing 15 percent of total revenues and five percent of GDP, which is within the limits of the estimated deficit in the Medium-term financial plan.

The estimated public spending for the fiscal year 2022 is about RO12.1 billion, an increase of two percent over what is expected to be spent by the end of this year, and this includes the cost of servicing the public debt amounting to about RO1.3 billion.

Around RO1.1 billion of the expected deficit for 2022 will be covered by domestic and external borrowing, while RO400 will be drawn from the reserves.

The cost of repaying government loan installments next year is expected to reach about RO2.7 billion. With regard to the level of public debt, it is expected to constitute 75 percent of the GDP, which is less than what was expected by 86 percent it is expected to constitute.

The estimated expenditure of the ministries in the 2022 budget is RO4.3 billion, of which RO3.2 billion are salaries of state employees.

The media briefing for the state’s general budget for the year 2022 at the Ministry of Finance is aimed at enhancing community participation and raising the level of transparency to review the achievements in financial, economic, investment fields.

Preliminary results expected until the end of 2021 indicate an increase in net oil revenues by 56 percent, a rise in gas revenues by 40 percent, and a decrease in non-oil revenues by 14 percent.

The Undersecretary of Finance, Abdullah bin Salem al Harthy, said that it is hoped that the credit rating of the Sultanate of Oman will improve over the coming years with the implementation of the tenth five-year plan and the policies aimed at controlling financial and economic conditions and achieving financial sustainability.

Other highlights

Minister of Finance: A law is underway to manage the funds that the government borrows.

Minister of Finance: The expected growth rate of the economy for the current year according to the International Monetary Fund (IMF) is 2.5 percent, which is the second-highest growth rate in the Gulf region.

The average target growth for the national economy during the period from 2021-2040 is about 5 percent. The economy has been recovering.

Minister of Finance: During 2022, RO25 million will be disbursed for new government projects – for building schools, electronic projects, the regional development programs, economic stimulus, and a number of strategic programs under the tenth five-year plan.

The infrastructure sectors (roads, airports, and ports) received the largest share (40.3 percent or 2. 2519 million) of the funds approved for the projects implemented under the plan at the end of August 2021.

Qais bin Mohammed al Yousuf, Minister of Commerce, Industry and Investment Promotion: The contribution of the services sector to the GDP during the first six months was 51.7 percent, followed by wholesale and retail trade 8.9 percent, real estate 8.3 percent, industrial activities 20.4 percent, and manufacturing industries 8.7 percent.

The number of applications submitted through the “Invest Easy” portal during the first quarter was 175,013.

The GDP recorded growth in the first half of 2021 compared to the same period of 2020, driven by an 8.7 percent growth in oil activities and 11.1 percent growth in non-oil activities.

Around 50 industrial opportunities with an investment value of RO250 million will be launched launch next year in cooperation with the Petroleum Development Oman (PDO).

Oman Investment Authority: The actual volume of investment spending in 2021 amounted to RO2.6 billion, and the spending in budget 2022 is estimated at RO2.9 billion, through projects – expansion and enhancement of existing projects, completion of construction projects in progress, approval, and the start of new development projects.

Oman investment Authority: Implementation and development of more than 110 investment projects during the years 2021-2022, which will be extended during the five-year plan.

The volume of investment spending in 2022 for the tourism sector will be RO193 million, the mining sector RO57 million, the logistics sector RO116 million, and communications and information technology RO156 million, food sector RO99 million, the fisheries sector RO54 million, the energy sector RO1.410 billion, the public services sector will amount to RO803 million, and other sectors RO52 million.

Investment in 2022 on communications and information technology is estimated at RO156 million, which includes the cloud services project with Oracle, digital transformation management project, submarine cable, and telecom network expansion.