Sultan of Oman, Haitham Bin Tariq, has approved the launch of the country's Vision 2040 which will be effective from next year, according to an announcement by the Foreign Ministry.
The ambitious project was unveiled in 2018 under Sultan Qaboos Bin Said, who passed away earlier this year, and seeks to bring the sultanate into the ranks of the world's most developed nations. The initiative is not too dissimilar from Saudi Arabia's Vision 2030 with both countries hoping to move away from post-oil economies, towards a more sustainable knowledge-based one.
In contrast to its regional neighbours in the Gulf, Oman has fewer natural resources to rely on and has the widest budget deficit among Gulf Arab states. Like most economies it has also been affected by the coronavirus pandemic and the subsequent fall in oil revenues. However, according to Muscat Daily, the Central Bank of Oman (CBO) said on Tuesday that the risks posed by these two factors on the sultanate's financial stability are "well-contained".
The Financial Stability Report (FSR) 2020 has indicated that while Oman's nominal GDP declined last year due to lower oil prices, the sultanate witnessed an uptick in economic activity measured at basic prices along with low inflation.
"In the meantime, containing the twin deficit and levels of public debt remain top priorities of the macroeconomic policy in Oman to preserve the macro-financial stability of the economy over the medium term in accordance with Vision Oman 2040," the CBO stated.
In October, Oman received $1 billion in direct financial aid from Qatar in an effort to help mitigate its economic crisis. Starting in April next year, Oman will become the fourth Gulf Cooperation Council (GCC) member state to implement Value Added Tax (VAT) at the standard rate of five per cent and follows Bahrain, Saudi Arabia and the UAE.