Oman has borrowed $1.56 billion (600 million rials) from its sovereign fund, the Oman Investment Authority, and another $4.59 billion (1.77 billion rials) through external and internal borrowings to partly finance its 2021 budget, the finance ministry said.
The total borrowing of 2.37 billion rials is 56 percent of the 4.2 billion rials worth of financing required this year, the ministry said in its March fiscal performance report.
The report came as rating agency S&P Global Ratings last week affirmed its ‘B+/B’ long- and short-term foreign and local currency sovereign credit ratings on Oman.
S&P expects the increase in the Omani government’s net debt to remain elevated through 2024, but it should decelerate relative to 2020, on the back of higher oil prices and a fiscal reform plan.
Oman faces large external debt maturities of $10.9 billion over 2021-2022, the rating agency said, expecting it will have to rely on external debt to fund the deficits and maturing debt.
Oman was the first Gulf government to tap the international markets this year, raising $3.25 billion in January. It also signed a $2.2 billion loan in early March with a large group of banks.
The fiscal report said Oman, as of end-March, still required 1.83 billion rials in financing for this year.
By end-February, Oman had paid 144 million rials in debt servicing and repaid 563 million rials in principal for some loans, the report said.