Oman’s new parliament law shrouds budget talks in secrecy

Since assuming power a year ago, Sultan Haitham bin Tariq Al-Said has overhauled government and state entities and begun pushing through sensitive fiscal reforms such as reductions in subsidies and the introduction of a value-added tax. (File/AFP)
Short Url
Updated 18 January 2021

Oman’s new parliament law shrouds budget talks in secrecy

  • Last week, the sultanate’s ruler announced a constitutional shakeup that included the appointment of a crown prince for the first time
  • Oman, a small oil producer, has piled up debt at breakneck speed in the past few years and its finances have been battered by low oil prices and the coronavirus pandemic

DUBAI: Oman has introduced a new law for parliament stipulating that state budget talks and the questioning of ministers should be carried out in secret, reducing transparency as the indebted state tries to tackle its creaking finances and shore up the economy.
Since assuming power a year ago, Sultan Haitham bin Tariq Al-Said has overhauled government and state entities and begun pushing through sensitive fiscal reforms such as reductions in subsidies and the introduction of a value-added tax, which had dragged down his predecessor the late Sultan Qaboos.
Last week, the sultanate’s ruler announced a constitutional shakeup that included the appointment of a crown prince for the first time and new rules on how the bicameral parliament, the Council of Oman, would work.
The new law, published in the official gazette on Sunday, states that discussions in both the elected lower house and the appointed upper house on draft development plans and the state budget should be conducted in secret as should sessions for the questioning of ministers. The previous Basic Law did not specify such secrecy.
S&P Global Ratings said on Sunday it believed fiscal austerity measures would be introduced gradually “to maintain socio-economic stability” in a country that saw Arab Spring-like protests in 2011 over unemployment, corruption and political reform.
It said that recent institutional reforms including establishing a clear line of succession would improve predictability and political stability but that high fiscal and external deficits, subdued economic growth and high youth unemployment still presented significant challenges.
Oman, a small oil producer, has piled up debt at breakneck speed in the past few years and its finances have been battered by low oil prices and the coronavirus pandemic.
Rated sub-investment grade by all major credit rating agencies, it faces a widening deficit and large debt maturities in the next few years.


Oil hovers near 13-month highs as storm dents US output

Updated 1 min 8 sec ago

Oil hovers near 13-month highs as storm dents US output

  • Severe winter storm in Texas caused US crude production to drop by more than 10 percent

LONDON: Oil prices extended gains for a fourth session on Thursday to reach the highest levels in more than 13 months, underpinned by an assurance that US interest rates will stay low, and a sharp drop in US crude output last week due to the storm in Texas.

Brent crude futures for April gained 33 cents, 0.49 percent, to $67.37 a barrel by 0925 GMT, while US West Texas Intermediate crude for April was at $63.45 a barrel, up 23 cents, 0.36 percent.

Both contracts hit their highest since Jan. 8, 2020, earlier in the session with Brent at $67.70 and WTI at $63.79. The April Brent contract expires on Friday.

An assurance from the US Federal Reserve that interest rates would stay low for a while weakened the US dollar, while boosting investors’ risk appetite and global equity markets.

A severe winter storm in Texas has caused US crude production to drop by more than 10 percent, or 1 million barrels per day (bpd) last week, the Energy Information Administration said on Wednesday.

“Combined with a dovish Jerome Powell and an already tight physical market, oil prices exploded higher,” Jeffrey Halley, senior market analyst for Asia Pacific at OANDA said.

Combined with a dovish Jerome Powell and an already tight physical market, oil prices exploded higher.

Jeffrey Halle, senior market analyst at OANDA

Fuel supplies in the world’s largest oil consumer could also tighten as its refinery crude inputs had dropped to the lowest since September 2008, EIA’s data showed.

ING analysts said US crude stocks could rise in weeks ahead as production has recovered fairly quickly while refinery capacity is expected to take longer to return to normal.

Barclays, which raised its oil price forecasts on Thursday, said it is seeing staying power in the recent oil price rally on a weaker-than-expected supply response by US tight oil operators to higher prices.

“However, we remain cautious over the near term on easing OPEC+ support, risks from more transmissible COVID-19 variants and elevated positioning,” Barclays said.

The Organization of the Petroleum Exporting Countries and their allies including Russia, a group known as OPEC+, is due to meet on March 4.

The group will discuss a modest easing of oil supply curbs from April given a recovery in prices, OPEC+ sources said, although some suggest holding steady for now given the risk of new setbacks in the battle against the pandemic.

Extra voluntary cuts by Saudi Arabia in February and March have tightened global supplies and supported prices.


IMF chief warns pandemic leaving some countries behind

Updated 24 February 2021

IMF chief warns pandemic leaving some countries behind

WASHINGTON: The crisis caused by the pandemic is leaving many economies lagging behind, increasing the plight of the poor, a problem made worse by “uneven” access to vaccines, IMF chief Kristalina Georgieva said Wednesday.
In a message to the Group of 20 meeting on Friday Georgieva urged governments to increase vaccine distribution, ensuring Covid-19 is brought under control.
“The economic arguments for coordinated action are overwhelming,” she said in a blog post.
“Faster progress in ending the health crisis could raise global income cumulatively by $9 trillion over 2020-25. That would benefit all countries.”
She said that should include financing for vaccinations, reallocation of excess supply to countries with a shortage, and scaling up of production.
The global pandemic death toll is approaching 2.5 million, according to Johns Hopkins University, and the shutdowns forced to control infections have devastated economies.
And while vaccine rollouts are raising hopes for a recovery this year, the IMF forecasts job losses in the G20 alone to total more than 25 million this year.
By the end of 2022, emerging market and developing nations — excluding China — will see per capital incomes 22 percent below pre-crisis levels, compared to just 13 percent lower for advanced economies, which will throw millions more into extreme poverty, Georgieva warned.
“That is why we need much stronger international collaboration to accelerate the vaccine rollout in poorer countries,” she said.
G20 finance ministers and central bank chiefs led by Rome will meet by videoconference to discuss the state of the recovery and how best to attack the problem.
The Washington-based crisis lender estimated more than half of the world’s 110 emerging and developing countries will see their incomes fall further behind advanced economies through the end of next year.
And the virus-driven economic crisis also will widen income gaps within developing nations, especially as millions of children are still facing disruptions to education.
“Allowing them to become a lost generation would be an unforgiveable mistake. It would also deepen the long-term economic scars of the crisis,” she warned.


Moody’s revises up US and emerging markets forecasts, cuts Europe

Updated 24 February 2021

Moody’s revises up US and emerging markets forecasts, cuts Europe

  • Emerging market growth moved up to 7 percent from 6.1 percent, led by upward revisions to China, India and Mexico

LONDON:Credit ratings firm Moody’s revised upwards on Wednesday its economic forecasts for the year for the United States and emerging markets, but cut Europe’s following the region’s tough COVID-19 lockdowns.
Moody’s pushed up its US growth forecast to 4.7 percent, from the 4.2 percent it had expected in November.
Emerging market growth moved up to 7 percent from 6.1 percent, led by upward revisions to China, India and Mexico, while the euro zone and Britain saw their respective projections cut to 3.7 percent and 4.7 percent, from 4.7 percent and 5.2 percent previously.
“The effects on individual businesses, sectors and regions continue to be uneven, and the COVID-19 crisis will endure as a challenge to the world’s economies well beyond our two-year forecast horizon,” Moody’s said in a report on its new forecasts.

Related


SoftBank-backed Berkshire Grey to go public via $2.7bn SPAC deal

Updated 24 February 2021

SoftBank-backed Berkshire Grey to go public via $2.7bn SPAC deal

SoftBank-backed robotics firm Berkshire Grey said on Wednesday it has agreed to go public through a merger with blank-check firm Revolution Acceleration Acquisition Corp. in a deal valuing the equity of the combined company at $2.7 billion.

Food and drinks group Agthia eyes acquisitions to become big regional player

Updated 24 February 2021

Food and drinks group Agthia eyes acquisitions to become big regional player

  • Agthia’s products include bottled water, dairy products and baked goods

DUBAI: Abu Dhabi-listed food and drinks group Agthia Group is looking into making more acquisitions to turn the company into one of the region’s top players in the food and beverage industry, its chief executive said on Tuesday.
After doing a number of deals already Agthia has a “pipeline of ideas” for additional targets to strengthen its position at home and abroad.
“Certainly we want to be a big regional player in the F&B business and more in the consumer space, so we want to move into that branded space where we can start building master brands across the region,” CEO Alan Smith said.
Agthia’s products include bottled water, dairy products and baked goods.
Smith did not rule out entering new markets, though he said a number of factors would come into play, including whether the company could enter at a large enough scale.
He said Agthia has had conversations with Israeli parties on potential cooperation, but no agreements have been finalized.
Smith also said Agthia had some sub-scale assets that the company was currently reviewing.
Abu Dhabi state-owned holding company ADQ, the corporate structure where Agthia sits, in November signed an agreement to acquire an indirect 45% stake in Louis Dreyfus Co., the first outside investment in the family-owned commodity merchant’s 169-year-old history.
“To be honest the Dreyfus transaction is fairly recent and I think we have had some initial conversations just in terms of the commodities space. But at the moment there’s no plans to have a conversation with them about (consumer packaged goods) products.”
Smith said Agithia, which reported a fall in net profit for 2020, had a strong balance sheet and was comfortable with its debt levels. It has no current plans to tap international debt markets, but may need to in the future, he said.