Macroeconomic Forecast Oman

Despite escalating unrest across the Middle East and North Africa (MENA) region, we stand by our view that Oman's economy will weather the political crisis relatively well, and forecast the economy to expand 4.3% in 2011 in real terms. Indeed, we highlight government spending and fixed capital formation as the major contributors to GDP growth, while non-hydrocarbon sector growth could be hurt by the recent turmoil in the region. To this end, household expenditure is forecast to stagnate in 2011, while the outperformers - government expenditure and GFCF - are projected to accelerate to 7.0% and 6.0% respectively.

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