Oman expects non-oil revenues to rise by 25%

Oman expects non-oil revenues to rise by 25%
Oman’s ministries of finance and economy are aiming to reduce the deficit through spending cuts. (Shutterstock)
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Updated 06 January 2021

Oman expects non-oil revenues to rise by 25%

Oman expects non-oil revenues to rise by 25%
  • A 5 percent value-added tax in April will help generate around 300 million rials, says official

DUBAI: Oman expects its non-oil revenues to increase by 25 percent this year, rising from 2.4 billion Omani rials ($6.24 billion) in 2020 to about 3.2 billion rials.

Speaking on the Asharq channel on Monday, Khalid bin Saif Al-Busaidi, media and communications director at Oman’s Ministry of Finance, said the sultanate would implement a 5 percent value-added tax in April which would generate around 300 million rials.

This would lead to an increase in non-oil revenues, which would be reflected in reducing the budget deficit and lowering dependence on oil, he added.

According to a Finance Ministry budget statement, the expected deficit for the current year was 2.24 billion rials, down from 4.2 billion rials in 2020.

Al-Busaidi said this year’s ministry-estimated borrowing plan of around 1.6 billion rials represented 73 percent of the total predicted deficit and included domestic and international borrowing.

HIGHLIGHTS

• According to a Finance Ministry budget statement, the expected deficit for the current year was 2.24 billion rials, down from 4.2 billion rials in 2020.

• He points out that Oman is working to pay the debts within deadlines without rescheduling and that a new debt repayment provision would set a financial reserve to pay future debts.

• The ministry has started the transfer of 150 million rials for the current year, and will double it for next year, reaching up to 600 million rials by 2025, and seeking to pay all the sultanate’s dues.

He pointed out that Oman was working to pay the debts within deadlines without rescheduling and that a new debt repayment provision would set a financial reserve to pay future debts.

The ministry has started the transfer of 150 million rials for the current year, and will double it for next year, reaching up to 600 million rials by 2025, and seeking to pay all the sultanate’s dues. Al-Busaidi noted that the 2021 budget was in line with the Omani 2040 Vision that aimed to raise spending efficiency and maintain the deficit in a downward direction, until a surplus was achieved by 2025.

On government expenditure to stimulate the economy, he said that while the ministries of finance and economy shared the same goals of reducing the deficit through spending cuts and increased non-oil revenues, they were still committed to boosting economic activity and growth and creating job opportunities.

He added that this would help to revitalize the economy, increase market movement, and generate employment opportunities, especially in small- and medium-sized enterprises (SMEs).

The initiatives form part of a set of packages implemented last year to tackle the impact of the coronavirus disease (COVID-19) pandemic on the Omani economy by increasing activity and supporting the private sector by targeting SMEs to create various industries and services for future development.


South African mobile operator MTN eyes $65mn deal for Syrian business

South African mobile operator MTN eyes $65mn deal for Syrian business
Updated 28 February 2021

South African mobile operator MTN eyes $65mn deal for Syrian business

South African mobile operator MTN eyes $65mn deal for Syrian business
JOHANNESBURG: MTN Group remains committed to negotiating a $65 million sale of its 75 percent stake in its Syrian unit, the South African mobile operator said on Sunday, despite the business being placed under judicial guardianship last week.
MTN Syria was placed under guardianship by a court in Damascus over alleged MTN violations of the terms of its licensing contract, which the state says deprived the government of revenue.
MTN has denied the allegations and on Friday said that it intended to appeal.
The appointed guardian, who is chairman of MTN Syria minority shareholder TeleInvest, will be responsible for managing day to day operations while the guardianship order remains in place. The court’s statement did not indicate how long that might be.
TeleInvest had been lined up to buy MTN Group’s 75 percent stake in MTN Syria for a previously undisclosed price.
“MTN Group is still committed to executing on the agreed transaction with TeleInvest to dispose of its 75 percent shareholding and loans for a consideration of $65 million in total,” a spokeswoman for the South African company told Reuters.
The sale to TeleInvest is part of MTN Group’s plans to exit the Middle East in the medium term.
The group’s operations in the Middle East have been marred by allegations that it used bribes to win a 15-year operating license in Iran and that it aided militant groups in Afghanistan.
MTN denies the allegations.
In the six months to June 2020, MTN Syria accounted for 0.7 percent of the group’s core profit.

Tabreed weather-watching AI could cool homes from Dubai to Makkah

Tabreed weather-watching AI could cool homes from Dubai to Makkah
Updated 28 February 2021

Tabreed weather-watching AI could cool homes from Dubai to Makkah

Tabreed weather-watching AI could cool homes from Dubai to Makkah
  • It is one of four new pilot projects announced by Tabreed that will support its aim to boost plant efficiency and reduce operating costs

DUBAI: The UAE company that provides cooling to thousands of homes across the Gulf plans to use weather-watching technology to anticipate when demand will rise and fall.

It is one of four new pilot projects announced by Tabreed that will support its aim to boost plant efficiency and reduce operating costs, the company said in a bourse filing on Sunday.

Demand for district cooling varies widely from day to day depending on outside temperature, humidity, wind speed and other atmospheric factors.

The “Wet Bulb Forecasting” project aims to better forecast customer demand over the next 24 hours by analyzing some of these factors using artificial intelligence.

“Based on the simulation of this pilot project, we forecast a 25 to 30 percent increase in performance, compared to our industry benchmarks,” said François-Xavier Boul, Tabreed’s chief development officer.”

Gulf states including the UAE and Saudi Arabia are seeking to reduce their carbon footprint through the use of green technology and alternative energy sources.

Tabreed operates 86 district cooling plants around the region, including three in Saudi Arabia.

Among the developments it services are the world’s tallest building in Dubai and the Jabal Omar Development in Makkah.


UAE, Ukraine discuss new trade, investment partnerships

UAE, Ukraine discuss new trade, investment partnerships
Updated 28 February 2021

UAE, Ukraine discuss new trade, investment partnerships

UAE, Ukraine discuss new trade, investment partnerships
  • The committee, which was formed after the state visit, discussed plans to enhance trade, investment and other partnership opportunities for both countries

DUBAI: The UAE-Ukraine Coordination Committee has held its first remote meeting to discuss potential partnerships between the two countries, state news agency WAM has reported.

The meeting followed the first visit of Ukraine President Volodymyr Zelensky to the UAE, and was attended by several Emirati ministers.

“The Ukrainian president’s visit to the UAE resulted in setting up a clear strategy to enhance the strong strategic relations between the two countries, which would contribute to opening doors for exploring new cooperation prospects,” Mariam Bint Mohamed Almeheiri, minister of state for food and water security, said.

The committee, which was formed after the state visit, discussed plans to enhance trade, investment and other partnership opportunities for both countries.

“We will work together over the coming months to explore initiatives that will contribute to increasing our trade volume and improve our economy on the basis of trade, investment and joint interests,” Almeheiri said.


China’s factory activity expands at a slower pace in February, misses expectations

China’s factory activity expands at a slower pace in February, misses expectations
Updated 28 February 2021

China’s factory activity expands at a slower pace in February, misses expectations

China’s factory activity expands at a slower pace in February, misses expectations
  • This year, the government appealed to workers to remain local to curb the spread of COVID-19

BEIJING: China’s factory activity expanded in February at a slower pace than a month earlier, hitting the lowest level since last May and missing market expectations after brief COVID-19-related disruptions earlier in the year.
The official manufacturing Purchasing Manager’s Index (PMI) fell to 50.6 from 51.3 in January, data from the National Bureau of Statistics (NBS) showed on Sunday, remaining above the 50-point mark that separates growth from contraction.
Analysts had expected it to decline to 51.1.
Chinese factory activity normally goes dormant during the Lunar New Year break as workers return to their home towns. This year, the government appealed to workers to remain local to curb the spread of COVID-19.
Generally, China’s economic recovery has been gathering pace due to robust exports, pent-up demand and government stimulus.
The official PMI, which largely focuses on big and state-owned firms, showed the sub-index for new export orders was 48.8 in February compared with 50.2 in January, slipping back into contraction after months boosted by overseas demand.
A sub-index for activity among small firms stood at 48.3 in February versus 49.4 a month earlier. Smaller firms were more affected by the seasonal effects of the Lunar New Year, said Zhao Qinghe, an official with the NBS in comments released with the data.
A sub-index for employment in the official PMI stood at 48.1 in February, down from January’s 48.4 as firms laid off more workers and at a faster pace.
Still, some manufacturing sector firms are seeing increasing pressure from rising labor costs and a shortage of workers, said Zhao.
China’s factory gate prices rose on year in January for the first time in a year, as months of strong manufacturing growth pushed raw material costs higher.
China eked out 2.3% economic growth last year. This year, the government may avoid setting a growth target for fear of provincial economies feeling pressured to take on more debt, policy sources previously told Reuters.
China will reinforce policy support for foreign trade and ensure the smooth operation of supply chains, its new commerce minister said earlier this week.
In the services sector, activity expanded for the 11th consecutive month but at the slowest pace in a year.


In oil-rich Iraq, a few women buck norms, take rig site jobs

In oil-rich Iraq, a few women buck norms, take rig site jobs
Updated 28 February 2021

In oil-rich Iraq, a few women buck norms, take rig site jobs

In oil-rich Iraq, a few women buck norms, take rig site jobs
  • They are part of a new generation of talented Iraqi women who are testing the limits imposed by their conservative communities

BASRA: It’s nearly dawn and Zainab Amjad has been up all night working on an oil rig in southern Iraq. She lowers a sensor into the black depths of a well until sonar waves detect the presence of the crude that fuels her country’s economy.
Elsewhere in the oil-rich province of Basra, Ayat Rawthan is supervising the assembly of large drill pipes. These will bore into the Earth and send crucial data on rock formations to screens sitting a few meters (feet) away that she will decipher.
The women, both 24, are among just a handful who have eschewed the dreary office jobs typically handed to female petroleum engineers in Iraq. Instead, they chose to become trailblazers in the country’s oil industry, donning hard hats to take up the grueling work at rig sites.
They are part of a new generation of talented Iraqi women who are testing the limits imposed by their conservative communities. Their determination to find jobs in a historically male-dominated industry is a striking example of the way a burgeoning youth population finds itself increasingly at odds with deeply entrenched and conservative tribal traditions prevalent in Iraq’s southern oil heartland.
The hours Amjad and Rawthan spend in the oil fields are long and the weather unforgiving. Often they are asked what — as women — they are doing there.
“They tell me the field environment only men can withstand,” said Amjad, who spends six weeks at a time living at the rig site. “If I gave up, I’d prove them right.”
Iraq’s fortunes, both economic and political, tend to ebb and flow with oil markets. Oil sales make up 90% of state revenues — and the vast majority of the crude comes from the south. A price crash brings about an economic crisis; a boom stuffs state coffers. A healthy economy brings a measure of stability, while instability has often undermined the strength of the oil sector. Decades of wars, civil unrest and invasion have stalled production.
Following low oil prices dragged down by the coronavirus pandemic and international disputes, Iraq is showing signs of recovery, with January exports reaching 2.868 million barrels per day at $53 per barrel, according to Oil Ministry statistics.
To most Iraqis, the industry can be summed up by those figures, but Amjad and Rawthan have a more granular view. Every well presents a set of challenges; some required more pressure to pump, others were laden with poisonous gas. “Every field feels like going to a new country,” said Amjad.
Given the industry’s outsized importance to the economy, petrochemical programs in the country’s engineering schools are reserved for students with the highest marks. Both women were in the top 5% of their graduating class at Basra University in 2018.
In school they became awestruck by drilling. To them it was a new world, with it’s own language: “spudding” was to start drilling operations, a “Christmas tree” was the very top of a wellhead, and “dope” just meant grease.
Every work day plunges them deep into the mysterious affairs below the Earth’s crust, where they use tools to look at formations of minerals and mud, until the precious oil is found. “Like throwing a rock into water and studying the ripples,” explained Rawthan.
To work in the field, Amjad, the daughter of two doctors, knew she had to land a job with an international oil company — and to do that, she would have to stand out. State-run enterprises were a dead end; there, she would be relegated to office work.
“In my free time, on my vacations, days off I was booking trainings, signing up for any program I could,” said Amjad.
When China’s CPECC came to look for new hires, she was the obvious choice. Later, when Texas-based Schlumberger sought wireline engineers she jumped at the chance. The job requires her to determine how much oil is recoverable from a given well. She passed one difficult exam after another to get to the final interview.
Asked if she was certain she could do the job, she said: “Hire me, watch.”
In two months she traded her green hard hat for a shiny white one, signifying her status as supervisor, no longer a trainee — a month quicker than is typical.
Rawthan, too, knew she would have to work extra hard to succeed. Once, when her team had to perform a rare “sidetrack” — drilling another bore next to the original — she stayed awake all night.
“I didn’t sleep for 24 hours, I wanted to understand the whole process, all the tools, from beginning to end,” she said.
Rawthan also now works for Schlumberger, where she collects data from wells used to determine the drilling path later on. She wants to master drilling, and the company is a global leader in the service.
Relatives, friends and even teachers were discouraging: What about the hard physical work? The scorching Basra heat? Living at the rig site for months at a time? And the desert scorpions that roam the reservoirs at night?
“Many times my professors and peers laughed, ‘Sure, we’ll see you out there,’ telling me I wouldn’t be able to make it,” said Rawthan. “But this only pushed me harder.”
Their parents were supportive, though. Rawthan’s mother is a civil engineer and her father, the captain of an oil tanker who often spent months at sea.
“They understand why this is my passion,” she said. She hopes to help establish a union to bring like-minded Iraqi female engineers together. For now, none exists.
The work is not without danger. Protests outside oil fields led by angry local tribes and the unemployed can disrupt work and sometimes escalate into violence toward oil workers. Confronted every day by flare stacks that point to Iraq’s obvious oil wealth, others decry state corruption, poor service delivery and joblessness.
But the women are willing to take on these hardships. Amjad barely has time to even consider them: It was 11 p.m., and she was needed back at work.
“Drilling never stops,” she said.