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Almost 50 years after it began shipping oil out of the port at Mina Al Fahal, the sultanate’s economy remains closely tied to the fortunes of hydrocarbons, which in 2015 accounted for 33.9% of GDP, 78.7% of state revenues and 59.4% of goods exports. Although 2015 was challenging for the nation’s oil and gas sector, the government is expected to keep crude production near its current level of 1m barrels per day through to at least 2020, and sector activity is thus likely to remain fairly constant despite the downturn. The sultanate’s underexploited offshore areas and attractive business environment meanwhile continue to offer opportunities for international oil and gas firms. This chapter contains an interview with Chris Breeze, Country Chairman, Shell Oman.

The insurance industry in Oman has grown strongly in recent years and now plays an important role in the domestic economy, rising from 0.9% of GDP in 2008 to 1.6% in 2015. Important regulatory changes made in 2015 and 2016, aimed at strengthening the industry’s capital base, promise to usher in a new era of expansion and to boost the amount of premiums retained within the local market. To grow, however, the nation’s insurers must first adjust to a potentially protracted low-oil-price environment and increasing levels of competition, both of which represent significant challenges.

The securities exchange in Muscat is a vital component of the Omani economy. The bourse serves as a showcase for the sultanate’s large enterprises, but its primary function is to act as an arena in which pooled capital can be distributed to investment sectors. In 2015, for example, the exchange had the capacity to provide OR2.56bn ($6.6bn) in funding. Throughout 2016, however, subdued oil prices and concerns about slow growth in emerging economies have made for a challenging environment, and the task of attracting liquidity to the market has become the key concern facing the authorities and regulator. As of late 2016, procedural and regulatory adjustments were being put into place to address these issues, and were expected to be central to the capital market’s ability to maintain its role in the domestic economy. This chapter contains an interview with Abdulaziz Mohammed Al Balushi, Group CEO, Ominvest.

A number of challenges have confronted Oman’s banking sector in recent years: a structural shake-up in the form of a new Islamic segment has increased competition levels; declining oil prices, which have constricted lending opportunities in some segments and compelled the regulator to encourage greater credit extension to others; and uncertainty surrounding the growth of regional economies, which further clouds the sector’s growth prospects in the short term. Nonetheless, the sector has continued to produce robust results, and is well positioned to weather the current economic turbulence. This chapter contains interviews with Hamood Sangour Al Zadjali, Executive President, Central Bank of Oman; and AbdulRazak Ali Issa, CEO, Bank Muscat.

Having endured low oil prices for the entire year, countries across the resource-rich GCC saw their balance sheets constrained in 2015, and in Oman’s case lower oil revenues led to a nominal GDP contraction of 13.8% and the largest deficit in more than a decade. Closing the fiscal gap is a government priority, with spending cuts, tax reform and increased private sector activity all expected to play a part in the process. The sultanate’s ambition, however, extends beyond the short-term issue of funding; over the longer term, the ability to restructure its economic base will be central to its future stability. This chapter contains an interview with Khalifa Al Barwani, CEO, National Centre for Statistics and Information.