Countries

Statistical Snapshot

A member state of the Gulf Cooperation Council (GCC) and categorized as a high-income economy, Oman has an estimated population of 4.6 million, according to the country’s National Central for Statistics and Information (NSCI). Population under the age of 30 made up around 50.2 percent of the total population in 2018, the highest among the GCC countries. Migrant workers made up 41.4 percent of the total population, compared to 26 percent in 2000. Life expectancy in 2018 reached  77 years[1], against an average of 71.9 years in the Arab region.[2] Total fertility rate for Omani women is 3.9 children per woman, compared to 0.7 births for expatriate women.[1]

The 2018 Human Development Index (HDI) for Oman is 0.834, positioning the country in the very high human development category, ranking 47 out of 189 countries and territories. When the value is adjusted for inequality, the HDI falls to 0.725, a loss of 13.1 percent, largely due to inequality in income.[2]

Education plays a key role in Oman’s long-term development national strategies. In 2017, the government devoted around 15.3 percent of its expenditures to education.[3] With the government’s investment in education, youth and adult literacy is almost 100 percent, at 98.6 and 95.7 percent, respectively.[4] With regard to the health sector, Omanis have free access primary health care and basic medication. With government health expenditure as a percentage of total expenditures at 6.3 percent,[1] out-of-pocket health expenditure (as a percent of current health expenditure) in Oman is the lowest among Arab countries at 6.6 percent.[4] 
 
Like all other GCC countries, Oman has been facing increasing fiscal challenges since the 2014 oil price shock. Consequently, and as past of its 5-year development plan “Vision 2020” and its future Vision “Oman 2040”, the government has planned fiscal reforms, including boosting private sector growth and employment and diversifying its revenues away from hydrocarbon, which accounted for 78.2 percent of government total revenues in 2018.[5]

With the Khazzan-Makarem gas field becoming fully operational, natural gas production jumped by 12.5 percent in 2018. Coupled with an increase in average daily oil production by 0.8 percent and an increase in the Omani oil prices by 36 percent in 2018, oil GDP growth increased to 4.7 percent, up from -2.1 percent in 2017. On the other hand, the non-petroleum sector recorded a marginal deceleration in growth during 2018, decreasing from 2.4 percent in 2017 to -0.7 percent in 2018. As a result, the Omani economy witnessed an increase in real GDP growth to 1.8 percent, up from 0.3 percent in 2017. Between 2015 and 2017, Oman recorded a double digit fiscal and current account deficit. With the recovery in oil prices in 2018 and spending restraints, the fiscal deficit dropped to 7.9 percent of GDP, down from 14 percent in 2017. The current account deficit improved to 5.5 percent of GDP in 2018, down from 15.6 percent in 2017.[6] However, macroeconomic vulnerabilities continued to rise, with government debt increasing further to 53.5 percent of GDP in 2018.[7]

In 2019, real GDP growth decelerated to 0.5 percent, after recovering in 2018, mainly due to a decline in oil production by 1 percent and a drop in oil prices from $69.78 per barrel in 2018 to $64.05 per barrel in 2019. Although reform measures and diversification efforts are boosting non-oil revenues, the hydrocarbon sector remained the dominant source of government revenues. With lower oil prices in 2019, the fiscal and current account deficits remained high at 7 percent of GDP and 5.2 percent of GDP, respectively.[6]

Although growth was estimated to improve to 3.7 percent in 2020, as per the International Monetary Fund World Economic Outlook (IMF WEO) projections of October 2019, the outbreak of Covid-19 coupled with subsequent economic lockdown and the plunge in oil prices, upset this recovery. As such, new projections indicate that real GDP growth is expected to contract by 2.8 percent in 2020. Additionally, in a country already suffering from high fiscal deficit, high level of debt and limited fiscal buffers, fiscal and current account deficits are expected to significantly widen to 16.9 percent of GDP and 14.1 percent of GDP in 2020, respectively, before starting to slightly narrow down in 2021, assuming a recovery in oil prices.[6]

Pandemic response comes as oil market shocks drastically reduce revenues. The government in April approved measures to preserve the jobs of nationals and support the private sector, by suspending some taxes and government fees, postponing loan servicing and providing SME support fund for six months.[8]

In Oman, eight out 10 employees are expatriates, but national workers account for 84.5 percent of the total employed in the public sector. Oman’s government encourages nationals to seek employment in the private sector. But of the 2 million private sector workers, Omani workers accounted for only 12.7 percent. The latest official data from NCSI shows that unemployment rate in Oman is 1.8 percent, with youth facing increasing unemployment challenges, at 5.4 percent for ages 18 to 24 and 4 percent for ages 25 to 29. Unemployment has been persistently high for young women, registering 13.8 for women aged 18-24) and 16.7 percent for women aged 25-29, in comparison to 3.9 percent and 1.3 percent for young men, respectively.[1]

This overview was last updated in May 2020. Priority is given to the latest available official data published by national statistical offices and/or public institutions.

Sources:

[1] National Centre for Statistics and Information (NCSI), Oman. 2020.  [ONLINE] Available at: https://www.ncsi.gov.om/Pages/NCSI.aspx [Accessed 7 May 2020].
[2] United Nations Development Programme (UNDP). 2019. Human Development Report 2019. Available at: http://www.hdr.undp.org/sites/default/files/hdr2019.pdf [Accessed 7 May 2020].
[3] The World Bank.2020. World Development indicators. [ONLINE] Available at: https://databank.worldbank.org/source/world-development-indicators [Accessed 7 May 2020].
[4] United Nations Educational, Scientific and Cultural Organization (UNESCO). 2018. UNESCO Institute for Statistics. [ONLINE] Available at: http://data.uis.unesco.org/ [Accessed 7 May 2020].
[5] Central Bank of Oman. 2018. Annual Report 2018.[ONLINE] Available at: https://cbo.gov.om/Pages/AnnualReport.aspx [Accessed 7 May 2020].
[6] International Monetary Fund (IMF). April 2020. World Economic Outlook Database. [ONLINE] Available at: 
https://www.imf.org/external/pubs/ft/weo/2020/01/weodata/index.aspx [Accessed 7 May 2020].
[7] International Monetary Fund (IMF). October 2019. World Economic Outlook Database. [ONLINE] Available at: https://www.imf.org/external/pubs/ft/weo/2019/02/weodata/index.aspx [Accessed 7 May 2020]. 
[8] International Monetary Fund (IMF). May 2020. [ONLINE] Available at: https://www.imf.org/en/Topics/imf-and-covid19/Policy-Responses-to-COVID-19#O [Accessed 21 May 2020]