The International Monetary Fund (IMF) has predicted that Oman will become the fastest growing economy in the GCC region next year. The sultanate’s real GDP is expected to grow by more than five per cent in 2019, the IMF said in its World Economic Outlook report released on Tuesday.
The Fund has revised up Oman’s 2019 growth forecast from 4.1 per cent projected in its April 2018 World Economic Outlook report. The IMF expects Oman’s economy to grow by 1.9 per cent this year.
On the back of increased oil prices, the IMF has raised its forecasts for 2019 GDP growth rates of all the GCC countries in October report from its April 2018 outlook. ‘The improved outlook for oil prices contributes to revisions to growth prospects for oil exporters, given the implied magnitude of the changes in disposable income’, the Fund said.
The IMF expects oil prices to average US$69.38 a barrel in 2018, much higher than the 2017 average price of US$52.8 a barrel. It said, ‘Global oil supply is expected to gradually increase over the forecast horizon, lowering oil prices to US$68.76 per barrel in 2019, and further to about US$60 in 2023’.
The Fund has projected Oman’s annual average rate of inflation to sharply rise to 3.2 per cent next year from 1.5 per cent in 2018. The IMF expects Saudi Arabia’s economy, which contracted by 0.9 per cent last year, to grow at 2.2 per cent in 2018 and 2.4 per cent next year.
The economic growth for the UAE is projected at 2.9 per cent for this year and 3.7 per cent for 2019.
However, the IMF sharply slashed growth forecasts for the whole Middle East and North Africa (MENA) region due to the slump in the Iranian economy and increased energy costs. It now projects the MENA region to grow by two per cent this year and 2.5 per cent in 2019, 1.2 per cent and 1.1 per cent lower, respectively, than the IMF forecasts in April.