Oman witnesses strong growth in non-oil sector this year: report

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Muscat: A new report from the Institute of International Finance expects the non-oil sector to witness strong growth this year.

The report pointed out that the growth of the non-oil sector in the Sultanate of Oman is expected to reach 3.5 percent this year, compared to 2.5 percent last year.

The report explained that the non-oil sector in the Gulf Cooperation Council countries is expected to register a growth of 4.8 percent this year, which is one of the highest growth rates among developing and emerging economies.

The Institute of International Finance said that high oil prices will limit the indirect impact of an increase in interest rates, by the US Federal Reserve, on non-oil economic growth in the Gulf Cooperation Council countries.

The report stated that the impact of the tightening of US monetary policy on the real non-oil GDP of the Gulf Cooperation Council also depends on the fiscal policies adopted by the six member states of the Gulf Cooperation Council.

The report also pointed out that during the past several decades, high global oil prices offset the negative growth impact of monetary policy tightening in the GCC countries, as high oil prices improve the domestic liquidity position, lead to relatively expansionary fiscal policies and increase credit available to the private sector. It also puts downward pressure on interbank rates.

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