Economic Update

Published 28 Apr 2020

As of 27 April Oman had 2049 confirmed cases of the novel coronavirus. The number of those who have died from the disease in the sultanate stands at 10, while the figure for recovered patients has increased to 364, according to the Ministry of Health.

Oman acted quickly to limit the spread of the virus. A range of measures were implemented, including travel restrictions on international flights and internal public transportation services, the closure of all schools, universities, malls and non-essential shops, and the suspension of prayers at mosques.

A lockdown has been in place in the capital Muscat since 10 April. Originally set to last until 22 April, the measures were extended until May 8, the authorities announced last week.

Innovative response

Oman has witnessed an increase of innovation and start-up activity as researchers, entrepreneurs and state entities pull together in response to the crisis.

The Muscat-based Research Council has launched a Covid-19 research programme headed by experts from various research institutes across the country.

The programme’s focus is on financially supporting projects conducting short-term applied research in various clinical and non-clinical fields associated with the pandemic. These include diagnostics, the role of telemedicine, the application of artificial intelligence, and the impacts on business and the economy.

For example, Sonnaa Oman, which is based at the Research Council’s Muscat Innovation Complex, has developed a digital artificial respiration device that simulates the ventilation system already approved for use in the country’s hospitals. The prototype, which was developed in coordination with specialist doctors and engineers, has been subjected to several quality control tests in recent weeks, prior to large-scale production of the device.

Meanwhile the National Business Centre, which is linked to Madayn, previously known as the Public Establishment for Industrial Estates, took part in a virtual global start-up competition between April 24 and 26, aimed at stimulating new ideas to combat Covid-19.

Of the Omani participants, start-up Wareed came first with its new digital platform designed to quickly connect suspected Covid-19 patients with their doctors.

The start-up weekend followed the launches of several other digital platforms developed in response to specific economic and social challenges that have been presented by the pandemic.

These include the Wareed platform, which facilitates home delivery of medicines to elderly people; easy, a distance-learning platform; and Igtimaati, an Oman-based application providing video-conferencing services.

In addition, the Muscat Municipality has been using drones both to sterilise neighbourhoods and to conduct remote heat temperature examinations on those suspected of having the virus.

Economic cushion

The economic impacts of the Covid-19 pandemic are set to be further exacerbated for Oman and other countries in the region by the plunge in global oil prices witnessed in recent weeks, as oversupply on world energy markets has come up against muted demand in the wake of stay-at-home guidelines for workers and businesses worldwide.

In an effort to cushion the worst of these impacts, on April 15 the government announced that Omanis whose salaries have been reduced are entitled to have bank loans restructured with no additional interest or fees.

Fuel subsidies will also be provided, and electricity and water bills have been frozen until the end of June.

These measures come in addition to earlier government announcements that it would be suspending municipal taxes and some government fees until the end of August, as well as rent payments for companies operating in industrial zones. Port and air freight fees have also been reduced.

A six-month suspension on loan repayments for borrowers from the Oman Development Bank and the small and medium-sized enterprise support fund was similarly announced.