Gulf Daily News Sunday, 26th October 2014 21 Oman plans to cut subsidies next year KUWAIT CITY: Oman’s government is likely to start cutting some state subsidies next year as the decline in global oil prices pressures its finances, Financial Affairs Minister Darwish Al Balushi said yesterday. The country’s original budget plan for 2014 assumed the government would run a deficit with an average oil price of $85 a barrel. For most of this year, the oil price has been higher, but in the last few months, it has dropped steeply to as low as $82. Oman has been considering ways to reform its costly and sometimes wasteful subsidy system, though reductions in spending would be politically sensitive. Asked whether cuts were likely next year, Balushi said: “Yes, I think the time is probable and especially with the decline in oil prices. I think the people would be more understanding now, more accepting. They realise that this was natural wealth that is being overused, wasted...” In an interview on the sidelines of a meeting of Arab finance ministers and central bank governors in Kuwait, Balushi also said the current subsidy system was ineffective because it did not focus on poorer people. “Everybody gets, people who deserve and people who do not. I think if we rationalise it and use the saving for better priorities, that will definitely have a return for the people of Oman.” The subsidy reforms will proceed gradually and make sure people who deserve state aid are not affected, Balushi said. He did not give details of which subsidies would be cut, but in the past has described petrol as an obvious target. Omani officials have said the government may return to the international debt market for the first time since 1997 to cover a budget deficit. Balushi said, however, that the government’s priority was to make its first issue of Islamic bonds for the domestic market. “Sukuk for the local market is more clear at the moment, and we might be doing it during the first quarter of next year.” Omani bankers say a rial-denominated sukuk issue would be a boost for the country’s n Participants at the workshop fledgling Islamic finance industry, giving Sharia-compliant “There are more than $2.8 billion invested in banks a badly-needed tool with mega real estate projects in the kingdom and the which to manage their liquidity. new law will set a framework to regulate and The sukuk issue might be support such projects.” worth the equivalent of around Additionally, the committee will have a dis- $300 million or $400m, Balushi pute resolution function which will assist devel- said, adding the government opers and investors in a quick settlement of has been considering maturities disputes to ensure smooth progress of the project of five and seven years. and the interest and rights of the investor. “We look at more options As per the latest Bahrain Economic Quarterly and see which one will serve report issued by the Economic Development the government objective and Board, the real estate and property market in also the economic objective Bahrain grew by 4.5 per cent in the second quar- and the financial market.” ter of this year compared to 1.8pc growth in the same period last year. Workshop focus on real estate development law MANAMA: Charles Russell, one of the premier full service law firms in the Middle East and a leading international law firm with offices in Bahrain and Qatar, held a workshop to discuss the new real estate development law in the kingdom. The workshop, held at the Capital Club, was introduced by Simon Green, the firm’s head of real estate and construction in the Middle East and included presentations from Unkar Chanian and Reem Al Mahroos and visiting partner, David Savage, global head of property and construction. The new development law introduced in July this year and which will come into force in February 2015, seeks to protect the interests of investors and developers by establishing a structure for such projects. Developers will be required to obtain a licence and to set up an account to allocate all the funds for the project to ensure that the money raised from the market will be used for a specific project which provide high level of governance. “The new law will attract more investments into the real estate market in Bahrain and restore investors’ confidence in this growing market,” Ms Al Mahroos said. n Industry and Commerce Minister Dr Hassan Fakhro directed Industrial Affairs Under-Secretary Osama Al Arrayedh to open Bahrain Truck and Heavy Trailer Company’s facility in Sitra. The event was attended by ministry officials, leading businesswomen, businessmen and representatives from AL-KO, a major German company in the field of spare parts and industrial structures. Market prices are reviewed MANAMA: Senior officials from the Industry and Commerce Ministry yesterday visited several markets, including Manama Central Market for vegetables and fruits to examine prices stability. The move comes as Bahrain prepares for Ashoora. Major suppliers asserted the availability of fruits and vegetables to meet the demands in the coming days, in which more than 1,500 tonnes of fruits and vegetables are provided on a daily basis from Saudi Arabia, Jordan, Egypt, Lebanon, Turkey, India, Pakistan and other countries. The Bahrain Livestock Company and the Delmon Poultry Company have vowed to provide adequate supply of meat during the season. ABC AD with qrcode 21x2col SALON & SPAS.pdf 5 10/14/14 6:01 PM
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