Oman has effectively used high oil prices to improve economy, consolidate growth

Business Monday 19/September/2022 18:02 PM
By: Vinod Kumar PK
Oman has effectively used high oil prices to improve economy, consolidate growth

Muscat: Oman has effectively surfed on the increasing energy prices which have helped improve the economy overall and consolidate growth after a difficult period in 2020 due to the COVID-19 restrictions worldwide, according to an industry expert.

The economy in Oman was able to recover well from the decline that it recorded during 2020 and was able to strengthen in 2021 and 2022, Wael Makarem, Senior Market Strategist – Mena at Exness, said in an exclusive interview with Times of Oman.

“The economy has benefited from higher energy prices, which also had a positive effect on non-oil sectors. However, the growth rate could drop if the global economy cools down,” he further added.

Speaking about the performance of the GCC economies he elaborated that the economies in the GCC have performed well and most are recovering from the restrictions of the COVID-19 period.

“The UAE has seen tourism and real estate record good performances while Saudi Arabia is seeing a double-digit gross domestic product (GDP) growth rate,” he further added.

However, the region could see challenges due to the volatility in energy prices and a drop in sentiment around the world; he said, pointing out the risks these economies may face in future.

Regarding expectations of oil prices both domestically and globally, Wael Makarem said that while oil prices have recovered to a certain extent during the last few days due to supply concerns, the oil market remains mostly exposed to slowing demand globally.
“China in particular has seen its industrial output and its general economic activity slow down due to COVID-19 restrictions which could push oil demand further down as it is the largest oil importer in the world and any economic issues could significantly affect the price of crude,” he further added.

Speaking about crypto-currencies in the Gulf Cooperation Council (GCC) economies he said that crypto-currencies have received a warm welcome in most countries in the GCC.
Some nations have engaged in experiments to push for the use of blockchain technology in various fields, such as Saudi Arabia and Bahrain. The UAE went even further by setting up an appropriate regulatory framework to attract companies in this sector, he said. “Such initiatives could lead to a concentration of crypto companies in the region, helping turn it into a global hub,” he added.

Regarding Oman allowing trading in crypto-currencies he said that like its neighbours in the region, Oman is also experimenting with blockchain technologies and crypto-currencies.

“Initiatives such as the work done by the central bank to develop a digital currency could help grow the use of such technology among banks and build a larger ecosystem for crypto-currencies in the country,” he added further.