IMF Staff Country Reports

The 2023 Article IV Consultation discusses that Oman’s economic recovery continues while inflation remains contained which is supported by favorable oil prices and sustained reform momentum. The banking sector remains resilient. Profitability has recovered to prepandemic levels, capital and liquidity ratios are well above regulatory requirements, and nonperforming loans remain low and sufficiently provisioned. Stress tests suggest that banks are resilient to credit and liquidity shocks. Risks to the economic outlook are balanced. Sustaining the reform momentum under Oman Vision 2040 will be key to building resilience and boosting prospects for more inclusive, diversified, and sustainable private sector-led non-hydrocarbon growth. This requires further efforts to improve institutional quality, reduce the state footprint, and enhance the business environment, which in turn would help amplify productivity gains from labor market and financial development reforms. It also calls for the steadfast implementation of the new social protection and labor laws, leveraging digitalization, and accelerating green investments and advancing policies to meet climate commitments.