Oman has given ‘go-ahead’ to its own Oman Investment Authority to keep and manage most of the nation’s sovereign wealth fund and finance ministry assets, the state TV reported referring to a decree from the sultanate’s ruler.
The order, announced by Sultan Haitham bin Tariq al-Said, will enable the new authority to keep all public assets except the Petroleum Development Oman company and government stakes in international institutions. The investment authority will also substitute sovereign wealth funds in the country’s official documents.
According to the numbers revealed by research group Sovereign Wealth Fund Institute, Oman’s largest sovereign fund, the State General Reserve Fund, holds assets of around $14 billion dollars while its second-largest fund, Oman Investment Fund, possesses around $3.4 billion.
Oman, a small oil producer compared to its Gulf neighbors, has been hit hard by the coronavirus pandemic and low oil prices.
International Monetary Fund estimates that Oman would require oil prices to be at $86.8 a barrel to manage its budget this year. Brent crude futures were selling at around $39 a barrel today.
Oman is developing as “an increasingly vulnerable spot in the region in light of its mounting debt,” the Institute of International Finance said, figuring that Oman could undergo a 5.3% economic recession this year while its deficit could increase to 16.1% from 9.4% in 2019.
Oman Investment Authority board members will be selected by Sultan Haitham, the decree said, moreover that all employees of the sultanate’s two sovereign funds would be shifted to the new entity.