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Omani ban on commercial activity to begin


Omani ban on commercial activity to begin

Oman Muscat corniche
Photo: Arabian Business

Oman’s ban on commercial activity will begin today and continue until May 15.

The restrictions are one of many that will attempt to halt the spread of COVID-19 over the Eid-al-Fitr holiday. The Supreme Committee of Combatting Coronavirus has also instated a curfew from 7 PM to 4 AM and banned holiday prayers and gatherings.

Oman’s economy was hit hard by the pandemic, shrinking 6.4% in 2020. Travel restrictions combined with low oil prices led the oil market, which makes up 30% of GDP, to crash. Sultan Haitham bin Tariq Al Said’s recovery reforms have focused on austerity and diversification. This includes tax exemptions for non-oil companies and reduced income tax for small and medium sized businesses.

Expect this week’s lockdown to have little effect on Oman’s short-term economic prospects. Recovery will depend primarily on vaccination rates, travel restrictions, increasing global demand for oil and tourism revenues. Medium- to long-term economic recovery is also likely. Haitham has shown willingness to enact the substantial reforms needed: cutting government spending and increasing tax revenues. His Vision 2040 reorganized Muscat’s government and improved investment conditions in diverse sectors. If the sultan succeeds, a diversified economy will likely focus on tourism and logistics.

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