Oman plans to borrow up to 10bn from abroad

2/9/2016 7:09:41 AM

(MENAFN- Muscat Daily) Muscat-

Oman plans to borrow between US$5bn and US$10bn from international markets to help bridge the budget deficit caused by low oil prices Central Bank of Oman (CBO) chief H E Hamood Sangour al Zadjali told Al Arabiya television on Monday.

The sultanate also plans to issue RO600mn of local bonds H E Zadjali said without providing a timeline for the sales. Oman has reserves enough to cover four months of imports he added.

The CBO recently launched a new government development bond (GDB) issue worth RO100mn with a maturity period of five years.

The sultanate's 2016 state budget estimates a deficit of RO3.3bn compared to an actual deficit of RO4.5bn for the year 2015.

Based on an average oil price of US$45 per barrel and average production of 990000 barrels per day Oman's total budgeted revenues for 2016 are at RO8.6bn which is 25.8 per cent lower than 2015 budgeted figures and down nearly four per cent from the actuals.

With oil languishing below US$35 a barrel and bank liquidity drying up Gulf borrowers are poised to venture away from the relative privacy of loan deals and into the bond market Bloomberg reported on Monday.

Governments in the Gulf Cooperation Council (GCC) will be pushed to sell about US$35bn of bonds this year to bridge budget deficits according to estimates from Emirates NBD Dubai's biggest bank.

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