DUBAI: Oman expects its public debt to reach around 21.7 billion rials ($56.37 billion) by the end of 2021, with international borrowing making up 76% of total public debt, a finance ministry document showed.
That would mean a rise of about 23% since end-2019, when the figure stood at 17.6 billion, according to a government bond prospectus.
Oman expects a 2021 budget deficit of 2.24 billion rials as public spending of 10.88 billion tops revenue of 8.64 billion, the finance ministry document showed.
To make up the shortfall the government aims to raise about 1.6 billion through borrowing and draw 600 million from its reserves.
Rated below investment grade by all major credit ratings agencies, Oman has piled on debt at breakneck pace in recent years and faces a tough repayment schedule.
It introduced a provision for debt repayment of 150 million rials for 2021 to cover part of its future loan instalments, the finance ministry said in a tweet on Saturday, citing Finance Minister Sultan al-Habsi.
Oman expects total debt service payments of 1.2 billion rials in 2021, the ministry document said.
Its debt repayment provisions will total 600 million rials over its five-year “fiscal balance” plan of 2021-2025, the minister added.
Preliminary results from the 2020 budget showed a 4.2 billion budget deficit, larger than the 2.5 billion that had been budgeted for, the ministry document showed.
The finance minister said in an interview with the state-run Oman News Agency on Saturday that Oman expects around 413 million rials in revenue from excise tax and a new value-added tax due to come into force in April, including around 300 million from the VAT alone.
Oman expects measures taken in its fiscal balance plan to cut spending by around 2.9 billion rials in 2021 while at the same time generating revenue from Oman Investment Authority dividends of around 800 million.
Some 400 million rials will come from income tax on companies and institutions, down 27% from 2020 reflecting the impact of the COVID-19 pandemic.
Other revenue is expected at around 1.4 billion rials, the state news agency said.
Oman expects local investment by government entities and companies under the Oman Investment Authority sovereign wealth fund of around 5.1 billion rials.
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