MUSCAT – Bank Muscat, the flagship financial services provider in the Sultanate, is optimistic on the outlook for Oman's economy, notwithstanding the challenges arising from the volatile oil prices.
AbdulRazak Ali Issa, Chief Executive, said: “The outlook on Oman's economy continues to remain strong owing to its stable fundamentals and expansive policies to support growth of both oil and non-oil sectors. The government affirmation that development projects will continue as planned without any negative impact on the lives of citizens is a clear indication that the economy is on track in achieving its objectives."
AbdulRazak Ali Issa said: “The Sultanate has weathered similar crises in the past, including the global financial crisis in 2008 as well as fluctuations in oil prices and overcome the challenges. The Vision 2020, which serves as the economic blueprint of the Sultanate, has paved the way for comprehensive economic diversification polices, investment opportunities and infrastructure development in the country. During challenging situations, the cushioning effect from budget surplus has led to sustained momentum for development projects in the country. In the prevailing situation, the government has initiated comprehensive measures, as reflected in the 2015 budget, to maintain economic and social growth."
The Chief Executive added: “The key to sustaining economic development is attracting both local and foreign investment in strategic projects and enhancing the role of the private sector. Oman has identified alternatives for oil and gas revenues by investing heavily in agricultural, industrial, fisheries, tourism and other sectors. The promotion of small and medium enterprise (SME) sector is another priority for Oman to equip the youth to embark on self-employment ventures and thereby contribute to nation-building."
AbdulRazak Ali Issa said: “The prevailing situation confirms the importance of intensifying efforts to diversify the sources of national income away from a reliance on oil revenues to overcome fluctuation of financial resources. Oman has adopted realistic Five-Year development plans to diversify the source of national economy and leverage the human, natural and non-oil resources. The big challenge for Oman is to reduce reliance on oil revenues."
The Chief Executive added: “The current value of projects being executed in Oman is about RO 30 billion. This is part of a pipeline of projects valued at RO 49 billion to be delivered within the country's 8th Five-Year development plan, which ends in 2015. Oman's quest to develop economic clusters in strategic locations around the country with the objective of creating jobs for local people and spreading development across the nation is gaining momentum in Salalah, Sohar, Sur and Duqm where world-scale maritime and industrial ventures are underway. Capitalising on Oman's vantage geographical position, the focus is on the transportation sector - airports, railways, ports and highways – as well as the tourism sector. Oman's efforts aimed at building trade infrastructure will help the country become a major player in global trade as well as a very competitive producer of goods in the region."
AbdulRazak Ali Issa said: “Oman has all the main ingredients to be not only an international player, but also a hub for trade and transit. Oman's fiscal freedom, including investment and trade, witnessed further improvement in the 2014 Index of Economic Freedom as the country's economic freedom score stood at 67.4, making it the 48th freest economy in the world. Oman is doing the right things and investing significantly in not only physical infrastructure improvement, but also in terms of developing human capital. Oman is aware of its potential as well as requirements to remain competitive and is getting ready for that."
AbdulRazak Ali Issa said: “The Omani banking sector has recorded stable performance on the back of sound macro-economic policies, strong fiscal system and fine-tuned monetary policy measures in the country. Amidst the challenging situation, high capital adequacy and profitability have defined the banking sector in Oman. Against the backdrop of the steady economic advancement, Oman's banking sector is witnessing healthy growth in lending, deposits and earnings. The liquidity position is very comfortable for the banks to participate and sustain the economic development in Oman."
The Chief Executive added: “During the last 33 years since its inception in 1982, Bank Muscat has been closely involved in the progressive march of the nation. The outlook for Oman's economy is positive and in view of the government commitment to economic and social development by accelerating non-oil revenue growth, Bank Muscat anticipates considerable growth opportunities. The bank remains committed to supporting the government objectives in diversifying the national economy, creation of employment opportunities to young educated Omani youth and expansion of industrialisation in the Sultanate."