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Fri 20 Mar 2020 11:11 AM

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Oman plans to cut spending by 5% as virus, oil price slump bites

Oman TV reports that the government is also preparing a public debt law and will conduct regular budget review

Oman plans to cut spending by 5% as virus, oil price slump bites
A general view of Muscat, the capital of Oman.

Oman plans to reduce spending by 5 percent in response to the coronavirus and the plunge in oil prices, Oman TV tweeted, a day after the sultanate announced a companion stimulus program.

The government will conduct a budget review every three months to monitor adherence to spending limits, it added. It’s also preparing a public debt law and is conducting a comprehensive review of public spending, Oman TV reported.

The sultanate has additionally approved funds to augment food reserves and to underwrite measures it’s taking to shore up the economy, Oman TV said.

It didn’t say where the money is coming from, but Oman is planning on drawing on reserves and selling assets this year.

On Wednesday, Oman’s central bank said it’s prepared to add 8 billion rials ($20.8 billion) in liquidity as a buffer against the economic fallout from the virus, largely skirting a budget that’s been battered by the crash in oil prices.

Facing its seventh straight year in the red, Oman’s fiscal shortfall this year was already expected to widen to 8.4 percent of gross domestic product, according to the International Monetary Fund.

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