Oman’s GDP up 12.3% in first half of year

Muscat: The Sultanate’s economy has witnessed more improvement during the first half of this year; thanks to the remarkable increase in crude oil price coupled with the efforts made to enhance economic diversification.
The National Accounts data point out that the Sultanate’s GDP at the current prices increased by 12.3 per cent during the first half of 2017 compared to a decline by 11.1 per cent during the same period in 2016, said a report published by the Central Bank of Oman.
The growth is driven by the good performance of the various economic sectors. The added value for the oil and non-oil activities grew by 34.9 per cent and 3.8 per cent respectively.
Despite the improvement in macro-economics, the economic challenges are still existent. The dual deficit at the state budget and the current account forced the government to take a number of measures including controlling the state budget by rationalising expenditure, reducing fuel and power subsidy, increasing governmental services’ fees, enhancing income tax revenues and other measures as well.
On the other hand, the CBO continued adopting appropriate monetary policies and controlling the liquidity conditions regularly to ensure availability of enough credit to meet the needs of the productive sectors.
As for the developments in terms of prices, the figures point out that the average inflation rate, as per the consumer price index, increased to 1.7 per cent during the first nine months of 2017. The increase is attributed mainly to the increase in the commodity group, such as education, transport, furniture, accessories, domestic equipment, regular maintenance for homes, tobacco and energy.
As a reflection of the increase in the average price of Omani crude oil during the first nine months of the year compared to the same period in 2016, the financial status of the state has witnessed many positive signs. The average price of Omani crude oil during the period from January to September 2017 stood at $50.6.
In terms of credit and deposits, the banking sector in the Sultanate continued its growth at reasonable rates despite the general sluggishness in economic activity. The data point out that the value of credit availed by the banking sector stood at OMR23 billion as of the end of September 2017; registering a growth by 5.7 per cent to hit OMR20.8 billion as of the end of September 2017.
The sectoral distribution of the total credit availed by the private sector show that the retail sector (mostly personal loans) constituted 46.3 per cent of the loans, followed by non-financial corporate with 45.5 per cent, financial companies with 5.1 per cent and other sectors with 3.1 per cent.
The value of the total deposits at the banking sector grew by 5.8 per cent to hit OMR21.6 billion. The private sector deposits increased by 5.6 per cent to hit OMR13.8 million as of the end of September 2017.
The sectoral distribution for the total deposits of the private sector point out that while individuals contributed by 48.6 per cent, financial corporates contributed to 28. per cent, non-financial corporates by 20 per cent and other sectors by 2.7 per cent.