Oman has approved its national budget for 2026 and launched the next phase of its economic programme that aims for 4 per cent growth through 2030, as the sultanate continues to diversify from its reliance on oil.
Revenue for this year's budget is projected at 11.45 billion Omani rials ($29.8 billion), up 2.4 per cent from last year and based on oil prices of about $60 per barrel, the Oman News Agency said on Thursday.
Total public spending is pegged at about 12 billion rials, a 1.5 per cent annual increase.
A budget deficit of 530 million rials is expected, which is a 14.5 per cent drop from last year, and equivalent to 4.6 per cent of total estimated revenue and 1.3 per cent of Oman's projected gross domestic product.
The budget was announced alongside the launch of the country's 11th five-year development plan that will run through 2030, which is the next phase of Oman's Vision 2040 economic strategy.
A key aspect between the budget and the plan is dedicated funding for economic transformation projects, which amounts to 400 million rials a year, Oman's Finance Minister Sultan bin Salem said.
The plan commits to fiscal sustainability, maintaining public debt within “prudent” limits, diversifying non-oil revenue sources, advancing social development and creating jobs, he said.
It is designed to “foster a diversified, competitive and sustainable national economy while guiding a measured transition towards a low-carbon economic model”.
“The plan has established a target for average annual economic growth of approximately 4 per cent over its duration,” he said.
Inflation would be maintained at a “secure” level of 1.4 per cent in 2026, while GDP growth is ultimately being planned to be raised at 5 per cent, said Nasser bin Rashid, undersecretary of Oman's Ministry of Economy.
In the previous phase of the development plan, Oman's budget generated an additional 11.29 billion rials in revenue from 2021 to last year, which the government attributed to higher global oil prices during the period.
“The 2026 budget aims to bolster financial, economic and social stability while enhancing resilience against future challenges, with a focus on fiscal sustainability and economic diversification,” Mr bin Rashid said.
Oman, a member of Opec+, is one of the smaller oil producers in the Gulf that, much like its neighbours, continues to diversify its economy away from crude dependence.
The oil industry plays a key role in Oman’s modern and expansive infrastructure, including electric utilities, roads, public education and medical services, according to the US International Trade Administration.
Net oil revenue, however, would still account for about half of Oman's total estimated revenue for 2026, with non-oil revenue comprising 33 per cent and net gas revenue making up 17 per cent, Mr bin Rashid said.
“Investment expenditures … [are] designated for economic transformation projects aimed at stimulating economic growth,” he said.
Separately, the Ministry of Labour said that new jobs for Omani nationals hit 51,482 last year, a 114 per cent annual increase that also exceeded the target of 45,000.
The “reflects the level of integration between various government entities and the private sector in supporting the national employment system”, the ministry said.
Last year, Oman said it will be introducing personal income tax from 2028, which is a significant milestone in the sultanate's push to achieve its economic diversification goals. Analysts, however, had said the tax ratio remains low to reduce burden on the population.
