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$15 Billion Investment to Create Thousands of Jobs in Oman

Oman : 26 May 2011

Oman is projected to spend record amounts in 2011 as the Sultanate pushes towards more job creation for nationals and further developments in the petrochemical and refinery infrastructure.

Oman has plans to spend substantial amounts of money on infrastructure and the petrochemical industry, up to $15 billion over the next decade. The nation’s minister of finance stated that this spending will result in the creation of new jobs by the thousands.

Oman in not an OPEC member and is considered a small oil exporter. Over the last few months the Sultanate has seen protests where employment, larger salaries and an end to graft is being demanded. Political unrest has spread across the Arab region.

Omani Finance Minister Darwish al-Balushi stated at an economic and investment forum being held in the capital that his government plans to spend from $10 to $15 billion in Duqm. These funds will be marked for new projects, such as a petrochemical plant and a refinery.

The minister noted that over the next decade up to 20,000 jobs for nationals would result from these projects.

Duqm is the site for the next industrial city, after Sohar has been hit hard with a concentration of protests. The port town is where the government plans for spending will produce a refinery, dockyard, and an airport, as well as other projects including petrochemical plants.

More than just one or two projects, this spending will result in an overhaul of Duqm’s infrastructure over the next decade, according to comments from the minister. In April the Sultan of Oman for the last four decades, US ally Qaboos bin Said, responded to the turmoil with a spending package valued at $2.6 billion. The Sultan also made announcements regarding the creation of 50,000 jobs, the establishment of an unemployment benefit distributed on a monthly basis and a reshuffling of his cabinet.

The wealthier neighbours of Oman announced an aid package back in March worth $20 billion targeted at Bahrain where unrest and turmoil have threatened stability and created social tensions across the Gulf Arab region.

Back in December Oman forecasted record high spending of $21.12 billion (or 8.130 billion rials) for the 2011 budget. This is an increase of 13.2 percent over the 2010 figures.

The budget for 2011 spelled out an 850 million rials deficit, after 2010 saw a deficit of $48.4 million rials. This year’s amount is equal to 3.8 percent of GDP and was based on the price of oil hitting $58/barrel.

Analysts in a recent Reuters poll forecasted that Oman would see a budget surplus reaching 5.3 percent of GDP for this year as a result of healthy oil prices. In the opening quarter of 2011 Oman sold their crude for $88.4/barrel on average.

Paul Holdsworth, Staff Writer, Gulf Jobs Market News
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