DUBAI, Jan 2 (Reuters) - Oman’s 2014 budget plan will slow growth in state spending as the government grapples with rising pressure on its finances, according to figures provided by state news agency ONA.
Spending this year is projected at 13.5 billion rials ($35.1 billion), up 5 percent from the original expenditure plan in the 2013 budget, which envisaged a 29 percent leap from the previous year, ONA reported.
Revenues in 2014 are estimated at 11.7 billion rials, up 4.5 percent from the 2013 plan. Finance Minister Darwish al-Balushi is due to announce the budget formally at a news conference on Thursday.
Although this year’s budget projects a deficit, it conservatively assumes an average crude oil price of $85 a barrel; Brent crude is currently trading around $111.0, suggesting Oman’s revenues could be much larger than projected and it may actually post a surplus in 2014.
Nevertheless, Oman is under increasing pressure to rein in spending growth after expanding expenditure sharply since 2011, when there were scattered street protests demanding more jobs and an end to corruption.
The government responded to the protests by boosting welfare programmes, public sector wages and job creation schemes to ensure social peace. The International Monetary Fund has warned Oman will have to reform its spending and find new revenue sources in the next few years to avoid falling into a pattern of ballooning budget deficits.