Muscat: The Ministry of Finance has announced Oman’s general budget for the fiscal year 2025, unveiling a strategic plan aimed at achieving sustainable economic growth while prioritizing social welfare and financial stability. With an estimated revenue of RO11.18 billion and total expenditure projected at RO11.8 billion, the budget reflects a cautious yet ambitious approach to fostering national development amid evolving global and domestic economic challenges.
Financial Sustainability
At the heart of the 2025 budget is the government’s continued focus on financial sustainability and economic growth.
The budget aims to achieve a real GDP growth rate of at least three percent at constant prices, in line with the country’s broader economic diversification strategy.
The plans also allocate significant resources to support Oman’s provinces in implementing development programs, thereby ensuring that growth is inclusive and benefits all regions of the Sultanate.
To underpin these initiatives, the budget has been structured based on an average oil price of $60 per barrel and an estimated production of 1,001 million barrels per day. This conservative yet realistic estimate is projected to generate a 1.5 percent increase in revenues compared to 2024, highlighting the government’s commitment to reducing its reliance on volatile oil markets while leveraging non-oil revenue sources.
Deficit management
While total expenditures are expected to rise by 1.3 percent to RO11.8 billion, the budget forecasts a manageable deficit of RO620 million, equivalent to 5.5 percent of total revenues. Notably, this represents a 3.1 percent reduction in the deficit compared to 2024, reflecting Oman’s continued efforts to optimize spending and improve fiscal discipline.
Part of the increased spending includes RO915 million earmarked for public debt servicing, underscoring the government’s focus on responsibly managing its financial obligations. The remaining resources will be funneled into sectors that promise long-term developmental impact.
Social Welfare
The 2025 budget places a strong emphasis on social welfare, allocating RO5 billion—42 percent of the total expenditure to social and essential sectors.
The largest portion, 39 percent, will go to education, followed by 28 percent for social security programs and 24 percent for healthcare.
These investments reaffirm the government’s commitment to maintaining the quality of essential services and ensuring fair access to social protections for all citizens.
Additionally, the budget allocates RO557 million to the Social Protection Program, which aims to enhance insurance coverage and provide equitable support to vulnerable segments of society.
A further RO1.14 billion has been dedicated to development projects, particularly those with high economic and social impact.
Sectoral Support and Subsidies
Acknowledging the importance of infrastructure and basic services, the government has allocated RO2.345 billion for contributions and key expenditures.
This includes:
• RO577 million for social protection programs.
• RO520 million for the electricity sector.
• RO194 million for water and wastewater infrastructure.
• RO35 million for subsidizing petroleum products.
• RO15 million for supporting essential food items.
These investments aim to stabilize critical sectors while mitigating the impact of global inflationary pressures on Omani households.
To drive economic activity, RO468 million from additional revenues has been earmarked for growth-stimulating initiatives. These funds are intended to boost spending on infrastructure, housing, and urban development, enabling more citizens to own homes and contributing to the expansion of the housing sector.
The government’s employment plan will also continue in 2025, focusing on creating jobs in both the public and private sectors to address unemployment and support the country’s youth.
His Excellency the Minister of Finance stated that the 2025 budget is a reflection of Oman’s ongoing efforts to balance financial sustainability with economic growth and social priorities. “This budget is designed to complete the implementation of financial sustainability plans while achieving a minimum growth rate of 3 percent and supporting development programs in all provinces,” he noted.
The Minister also highlighted the government’s strategic approach to channeling additional financial resources into social spending and growth-enhancing projects. This aligns with the overarching goals of Oman Vision 2040, which seeks to create a diversified and resilient economy while improving the standard of living for all Omanis.
As Oman enters 2025, the general budget serves as a testament to the government’s ability to adapt to challenges while maintaining a strong commitment to its people. By balancing fiscal responsibility with investments in key sectors, the 2025 budget sets the stage for a prosperous and equitable future, ensuring that economic gains translate into tangible benefits for all segments of society.
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