Oman construction will not suffer from oil drop
Ministers confirmed major projects will still go ahead
The Oman government has confirmed it will have to slow spending following the drop in oil prices, but ministers say infrastructure budgets will not be affected.
Oman is one of the more vulnerable Gulf areas in terms of the oil price drop and it needs prices to remain high to balance its budget.
Crude oil has fallen to roughly $85 a barrel but Oman needs $102 per barrel to break even in 2014, according to estimations made earlier this year by the International Monetary Fund.
The areas where cuts will be made have not yet been confirmed by finance ministers, who are still considering options, but existing construction projects will not be affected.
The Sultanate has set aside billions of dollars to invest in massive construction projects to improve its transport systems and encourage tourism in a bid to ensure its economy remains secure regardless of fluctuating oil prices.
Some of the projects which are still set to go ahead include the national rail network, with the first phase of the 1,000km track linking Muscat to the UAE to be complete by 2017.
Also, over the next five years, six new airports will be constructed and existing airports are likely to be expanded.
The Sohar Industrial Port Company is interested in constructing a new port city project atSoharPortat an approximate value of USD$12bn.
MEED Projects, the region’s leading propejects tracker, says around $145 billion worth of projects are currently under way or will be awarded in Oman.
The property market is expanding, which coupled with heightened interest from developers in tourism projects such as luxury hotels and resorts is attracting both regional and international players.