Govt companies in Oman urged to be self-sustaining

Muscat: All the government companies will have to stand on their own feet and not be dependent on the state’s general budget for their survival, the chairman of the Omani Investment Authority (OIA), Abdulsalam bin Mohammed bin Abdullah Al Murshidi, said on Wednesday.

In an interview with Oman TV, the chairman said that the new government companies will be established only if they are profitable, if they are not economically and commercially viable, they will not be established.

“Of course, there are other strategic goals that government companies must carry out, and with the presence of these goals, these companies will eventually have to generate profits and the financial sustainability of these companies is the main focus for their establishment,” he added.

Al Murshidi also stressed that “no government companies after today will get money from the state’s general budget to run their business, but every company we will establish must be able to continue and support itself.”

The effort to encourage state-owned enterprises (SOEs) to stand on their own feet comes as part of efforts by the OIA that began a year ago, to ensure companies operate on a new structure of financial and operational performance. This was instituted through policies and guidelines aligned with Oman Vision 2040 that serve the national interest.

Thegovernance of SOEs became one of the OIA’s top priorities, particularly in the light of Royal Decree No. 61/2020. The decree announced the restructuring, merging, and liquidation of a number of enterprises, the formation of new companies, the appointment of high-calibre people to boards of directors, and the launch of the Rawabet programme.

There have been more than 400 meetings held between 70 employees of OIA, and some 300 representatives of state-owned enterprises.

Three executive workshops have also been held with the chairpersons and CEOs of companies, as well as 40 with those holding managerial posts. About nine policies and a code of governance for SOEs have also been drafted. Financial sustainability is a key aspect of Vision 2040. The National Programme for Financial Sustainability, implemented by the Ministry of Finance, aims to do just that.

“This programme was developed as an extension of the National Programme for Fiscal Balance. It aims to elevate the financial position of the Sultanate from balance to sustainability, which entails aligning financial policies with the requirements of economic growth,” said the 2020 Economic Diversification Report issued by the Vision 2040 Implementation Follow-up Unit.

A four-year implementation timeframe (2021-2024) has been set for the programme, which involves managing the performance of government entities involved in this agenda.