The Sultanate of Oman continues to pay the public debt, which over the past four years recorded a significant decline. This led to an improvement in the country’s credit rating, but resulted in a contraction in the activities and work of large Omani commercial institutions and companies due to the decline in the implementation of the number of annual government projects.
The state’s financial commitment to public debt has led to an improvement in the level of Oman’s credit rating due to the steps taken by the government in this regard that aimed at economic reform on the one hand, and controlling public spending, in addition to exploiting additional revenues to pay the debt on the other hand. This debt is expected to decline further in the coming years.
In general, the public debt is borne by every individual in society, and it is a burden on the shoulders of every individual. Governments are committed to paying it regardless of their economic and financial circumstances. Failure to pay it creates major problems for governments and members of society as well, which prompts governments to allocate a large portion of annual financial revenues to pay it.
Oman’s recent credit rating level, according to Moody’s, was raised from “Ba2” to “Ba1,” and the future outlook was changed from positive to stable, which gives the government and institutions a greater opportunity to obtain loans and finance large projects whenever they wish, and guarantees the rights of creditors.
The improvement of the Omani government’s financial policies will contribute to strengthening the country’s financial position, while the government is making strenuous efforts towards enhancing economic diversification and stimulating internal investments.
The Omani government’s commitment and direction in paying the public debt since 2019 has led to an improvement in the credit rating, but this has had a negative impact on the business of the private sector, which still feels that the total value of establishing large economic projects has decreased greatly, and the movement of economic circulation has slowed down which led to a decline in the business of large companies and institutions, the bankruptcy of some of them, and the dismissal of a number of Omanis working for them, especially transportation and contracting companies, and others. This also led to the deportation of a large number of expatriate workers who were working in these institutions, and thus the real estate, tourism and retail sectors were affected by the decline in the business of these large commercial institutions.
Over the past years, the government has adopted ambitious plans for the Omani economy and economic diversification within the framework of the future vision of Oman 2040 to make good use of financial resources and human competencies in the coming period. The implementation of the social protection policy comes within this framework in order to enable the various segments of Omani society to obtain additional monetary financial resources, which will enhance the financial capabilities of families and Omani society, and lead to greater movement of the Omani economy and private sector businesses, in addition to enhancing aspects of individual savings of the people.
The discovery of new quantities of oil and gas and the exploitation of other natural resources will enhance the country’s annual revenues and achieve more financial surpluses, which will help enhance payments on public debt amounts so that Oman will be able, in the next few years, to establish huge projects and enhance other aspects of the economy.
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