MUSCAT: The Ministry of Finance unveiled the State Budget for 2024 at its headquarters on Monday.
Based on an oil price of $60 per barrel and a production rate of 1.031 million barrels per day, the public expenditure for fiscal 2024 is projected at RO 11.650 billion, while the total revenue is estimated to amount to RO 11.010 billion, with a total deficit of 640 million.
Public spending is expected to increase by 2.6 per cent in comparison to the previous year. Of the total expenditure, RO 8.573 billion (73 per cent) will be allocated towards current expenses. Fifty-two per cent of this figure has been allocated towards Ministries and Government Units (totalling RO 4.453 billion), 36 per cent allocated towards Defence and Security (RO 3.070 billion) and 12 per cent towards servicing the public debt (RO 1.05 billion).
Furthermore, 19 per cent of the public expenditure (RO 2.177 billion) is earmarked towards Contributions and Other Expenses.
Significantly, approximately 25 per cent will be allocated to the newly established Social Protection Program with a budget of RO 560 million. A further 21% will go towards supporting the power sector (RO 460 million), 18% for debt repayment (RO 400 million), 11% for developmental projects (RO 240 million), and 8% to support the water and wastewater services sector (RO 184 million). The balance amount will be allocated towards supporting and subsidizing other sectors of the economy.
The remaining 8 per cent of public expenditure (RO 900) will be allocated towards developmental expenses. These funds will be allocated toward seven main sectors including education, health, youth and sports, housing and urban development, transport, agriculture, fisheries and water resources.
The Ministry estimates total revenue to increase by 9.5 per cent this year to RO 11.010 billion. The oil and natural gas industries are expected to contribute to 68 per cent of revenues this year. The oil industry is expected to contribute to around 54 per cent of this figure (RO 5.914 billion), while the natural gas industry is estimated to contribute by 14 per cent (RO 1.575 billion) in 2024. On the other hand, non-hydrocarbon industries will contribute around 32 per cent of revenue (RO 3.520).
The Ministry report stated that the RO 640 million deficit will be financed through domestic and external borrowings of RO 240 million, as well as withdrawals from reserves (RO 400 million). However, if the general state revenue exceeds approved expenditures, the State will not resort to additional borrowing or withdrawals from reserves to pay the expected deficit in the 2024 budget, the Ministry added.
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