Country Report Oman February 2009

Outlook for 2009-10

• The long-established political structures will remain stable under the rule of the sultan, Qaboos bin Said al-Said, over the outlook period. The greatest political risk is likely to be uncertainty over who will succeed him.
• Oman will maintain its support for a peaceful solution to the Iranian nuclear dispute—the Gulf region's biggest geopolitical concern—having warned of regionwide instability if the US or Israel were to resort to military action.
• Economic policy will focus on diversifying the economy away from its reliance on the hydrocarbons sector and on meeting the employment needs of a young and expanding population.
• Oman will not join the Gulf Co-operation Council (GCC) single currency. Instead, it will retain its currency peg to the US dollar.
• The Economist Intelligence Unit forecasts that Oman's real GDP growth will slow to 4.9% in 2009, owing to a slowdown in the world economy. Real GDP will expand by 5.2% in 2010, as export volumes strengthen.
• We forecast that average consumer price inflation in Oman will drop sharply over the outlook period, to 7.5% in 2009 and 5.1% in 2010, as oil and non-oil commodity prices decline as a result of weakening global demand.
• The decline in global oil prices in 2009 will have a considerable impact on Oman's current-account balance, which we expect will fall into deficit in 2009, before returning to a modest surplus of 1.3% of GDP in 2010.

Monthly review

• Travel operators and hotels will now be held responsible for repatriating any expatriates from the UAE who become stranded in Oman because, under new UAE regulations, they cannot return to the UAE for at least a month.
• Like other members of the GCC, Oman condemned Israel's assault on the Gaza Strip, which ended in January. Omanis held rare protests in support of the Palestinians.
• Oman has completed a brand-marketing exercise by launching a new national logo. A number of sectors, including tourism and education, have been earmarked for development to help strengthen national identity.
• Ties with India have been bolstered by a series of visits by Omani and Indian officials to each other's countries.
• A pilot phase of an "e-Purse" project has begun, which will enable Oman's citizens and expatriate residents to use their national identity and residency cards as a means of payment.
• Two water supply projects have been launched in central and eastern Oman.

Source: Country Report

This report covers the following industry codes:
SIC Code: 37;53;49;60;2834;80;48;1;20;10
NAICS Code: 336;44;22;52;3254;62;517;11;311;212