MUSCAT, March 20 Oman is likely to privatise one
more state company this year, after offering a minority stake in
telecommunications operator Omantel, Minister for
Financial Affairs Darwish al-Balushi said on Thursday.
"After we are done with Omantel's IPO (initial public
offering) ... the next state-owned company to be privatised will
be announced," Balushi told reporters after meeting his Qatari
counterpart, Ali Sherif al-Emadi, in the Omani capital. "We are
looking at privatising a number of companies."
Balushi said the oil and gas sector was not included. But he
said Qatar might be interested in investing in hydrocarbons, as
well as in tourism.
Oman's government, which faces widening fiscal deficits in
coming years, has said it would revive its privatisation
programme to raise revenue and stimulate the private sector.
The government owns more than 60 companies across various
sectors, the minister said in September.
Omantel said earlier this week the first part of the
government's sale of a 19 percent stake was 1.99 times
subscribed. The sale is expected to raise around $570 million
for the Gulf Arab sultanate, which is trying to increase its
non-oil income and fund rising public spending.
Balushi also said that the government plans to break up Oman
Air, the country's loss-making national airline, this year. It
will remain a state-owned company, at least for now, but will be
split into three parts that would include shipping and ground
"Oman Air is losing money, so it's going through a
restructuring phase. We will have three companies instead of
one," he said. "The restructuring will be within the current
year of 2014."
Oman, a small non-OPEC oil exporter, has smaller energy
reserves than its wealthy Gulf neighbours. Increases in spending
to improve social welfare and create jobs has made it difficult
to manage state finances.
The International Monetary Fund warned in June that the
country would need to constrain spending growth and raise
non-oil income in the medium term to keep its finances
The IMF predicted in October that Oman's state budget could
slip into a deficit of 0.2 percent of gross domestic product in
2015, widening to as much as 7.1 percent in 2018.
(Reporting by Fatma Al-Araimi; Writing by Martin Dokoupil;
Editing by Larry King)