Strong foreign inflows key to economic diversification - Omani central bank
Increasing the role of the private sector in the national economy and stimulating domestic and foreign private investments is the key to achieving economic diversification and increase in employment opportunities which are the major challenges facing the Omani economy, according to the Central Bank of Oman (CBO) Annual Report 2012.
“The efforts being exerted by the CBO and the government is expected to result in significant economic growth along with economic diversification and increase in employment opportunities,” the report added.
The Eighth Five-Year Development Plan (2011-15), with emphasis on large public investment programme, seeks to achieve this through intensifying efforts related to the development of small and medium enterprises (SMEs), developing the financial sector, financing the private sector, improving investment climate, social sector reforms and developing infrastructure, the CBO said in the report.
During 2012, private sector employment increased by 15.4 per cent compared to 13.7 percent in the previous year.
Of the total employment in the private sector, expatriates accounted for 88.4 percent in 2012 compared to 86.5 percent in the previous year. Omanis in the private sector has been a key policy focus of the government.
The number of Omanis employed in the private sector has been consistently higher since 2007 and the margin is increasing over the employment of Omanis in the public sector, the report stated.
Meanwhile, the Petroleum and Gas sectors continued to play a significant role in the overall economic activities of Oman.
“Benefitting from favourable price developments, the petroleum sector output expanded by 10.9 per cent in 2012 as value addition inn crude oil and natural gas sectors rose by 10.9 per cent and 10.4 per cent, respectively.
In terms of share in the nominal GDP, crude oil and gas accounted for 48.4 per cent and 3.8 per cent, respectively, in 2012,” the report stated.
According to the report, crude oil production increased 4.1 per cent to 336.2 million barrels in 2012, as compared to 323 million barrels during 2011.
The GDP originating from non petroleum industrial activities slowed down to 4.0 per cent in 2012, as compared to a growth of 16.6 per cent the previous year.
The growth rate was particularly slow with respect to the manufacturing sector which recorded a growth of 2.5 per cent as compared to 22.6 per cent in 2011.