Oman spent RO94 bn in 40 years

Oman has spent nearly RO94 billion (Dh920bn) over the past 40 years, an average annual expenditure of around RO2.35bn (Dh2.3bn), the country’s Minister of National Economy said in remarks published on Thursday.

Ahmed bin Abdulnabi Mekki said spending covered education, health, electricity, water, roads, telecommunications and all other sectors in the Gulf nation as part of a massive construction drive triggered by the discovery of oil.

In statements marking Oman’s national day, the minister said the steady rise in public spending over the past years had sharply expanded the country’s economy including the non-oil sector.

“Expenditure has totalled around RO94bn since 1970….the country’s gross domestic product has jumped by nearly 170 times by the end of 2009 to reach RO17.73bn,” he said in the comments published in Omani newspapers.

Despite a steady growth in Oman’s population, its GDP per capita income has leaped by more than 35 times during that period to reach RO5,808 in 2009.

Trade also swelled by about 23 times, with exports peaking at around RO10.6bn and imports at nearly RO6.9bn in 2009, Mekki said.

“One of the main factors that have contributed to this massive development in Oman was the sharp increase in the country’s oil production,” he said.

From only around 332,000 barrels per day in 1970, Oman’s oil output surged to nearly 812,000 bpd through 2009 while its proven crude reserves swelled to around 4.9bn barrels compared with 1.4bn barrels in 1970 despite the large quantity of oil extracted from the fields.

“Besides rapid economic growth, heavy spending allowed Oman to diversify its economy as the non-oil sector’s contribution to GDP grew to nearly 59 per cent last year from around 31.6 per cent in 1970,” Mekki said.

“Furthermore, oil export earnings provided 100 per cent of Oman’s total income in 1070…they now account for around 66 per cent.”

Oman, which is not an Opec member, has used its oil windfall to build a modern infrastructure as was the case in the UAE and other Gulf hydrocarbon producers.

Besides oil exports, Oman also gets at least $one billion a year from its LNG plant in the southern port of Sur, with an estimated output of 10m tonnes per year. The country is also the largest fish producer in the six-nation GCC and the third in the Arab world after Morocco and Mauritania.