Oman Investment Authority (OIA), the sovereign wealth fund of the Sultanate, has introduced a OMR2 billion ($5.2 billion) fund with the objective of promoting investments in the private sector and small and medium-sized enterprises. The fund, called the Future Fund Oman, was announced in May of the previous year and seeks to enhance the country’s economy by supporting diversification and attracting foreign investment.
According to a recent statement from Oman’s Ministry of Economy, the fund will primarily focus on sectors such as tourism, manufacturing, green energy, maritime resources, and technology. In an interview with the Oman News Agency (ONA), Abdulsalam Al Murshidi, president of OIA, highlighted that the fund serves as a catalyst for national economic growth and a reliable partner for local and international investors seeking to expand their projects within Oman’s economy.
#صندوق_عمان_المستقبل ذراعٌ تمويليٌ واعد لتنفيذ مشاريع اقتصادية استراتيجية، يسهم في استكمال مسيرة التنمية الاقتصادية الهادفة إلى تحقيق #التنويع_الاقتصادي وجلب المزيد من الاستثمارات. pic.twitter.com/LnLeX0zMSp
— وزارة الاقتصاد – سلطنة عُمان (@MOE_Oman) January 17, 2024
Oman’s three-year fiscal stability program for economic recovery
To bolster its economic recovery from the pandemic-induced slowdown and foster the development of its financial sector, Oman launched a three-year fiscal stability program in October 2022. The nation heavily relies on hydrocarbons, and this program aims to provide momentum to its recovery efforts.
According to the International Monetary Fund (IMF)’s November report, Oman’s economy is projected to grow by 1.3 percent in 2023, a decrease from the 4.3 percent growth observed in 2022, primarily due to OPEC+ oil production cuts.
Preliminary data indicates that the country recorded a budget surplus of OMR931 million for the financial year 2023, driven by higher oil and gas production and prices, resulting in greater public revenue than anticipated. This surplus contrasts with the deficit of approximately OMR1.3 billion initially forecasted by the country’s budget.
Fitch Ratings assessment
In a recent assessment, Fitch Ratings stated that Oman’s ambition to expand domestic green hydrogen production could have long-term benefits for its gross domestic product, fiscal revenue, and balance of payments in the midst of the global energy transition.
Oman has set ambitious targets for renewable hydrogen production, aiming to reach a minimum of one million tons per year by 2030. Subsequently, the capacity would be increased to 3.75 million tons by 2040 and 8.5 million tons by 2050.
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