Growth remains robust in Oman, with high government spending and a number of megaprojects keeping spirits high over 2014.

Driven by revenues from oil, which naysayers had warned were dangerously low, the government has been afforded more time to diversify income streams thanks to enhanced oil recovery (EOR) techniques. Now, a series of megaprojects, including the visionary Port of Duqm project, are extending Oman's long-term growth expectations and offering a glimpse of life after oil.

Oman generated $80.5 billion in GDP in 2013, up 3% on the previous year. Hydrocarbons accounted for 44% of that figure, as well as 85% of public revenues. And a drop in Omani crude prices from $109.6 per barrel in 2012 to $105.5 in 2013 wasn't enough to hurt public coffers as an increase in production of 2.3% to 343.8 million barrels, or 941,917 barrels per day (bbl/d), more than offset the fall. The barrels per day print is also significant in that it represents a dramatic turnaround from just 710,000 bbl/d in 2007 following the implementation of EOR. Not content, then, to sit on a pile of money, the authorities ramped up spending over 2014, overshooting the budget by 23% with a figure of OMR16 billion. Among the lucky recipients of the liquidity were health, education, and job creation, with a special focus on SMEs, which account for 90% of all registered firms in the country. New initiatives include encouraging banks to allocate 5% of total credit to small firms, while the government will also seek to up procurement through SMEs and require firms to do the same under tender agreements. And with projects like the Port of Duqm and related infrastructure on the table, on which up to $100 billion could be spent by 2018, SMEs could be in for quite a windfall over the coming years. The resulting budget deficit could also be covered by a return to the international debt market in the form of a sukuk issuance that would both fuel the growing sharia-compliant finance industry in Oman and also provide fresh liquidity to the government in one fell swoop. While nothing is certain for now, an issuance could potentially occur in 1Q2015.

Elsewhere in money terms, the authorities have kept things ticking over in 2014, the Omani economy is looking particularly well sheltered from the effects of inflation, save any major rise in imported food prices due to a dramatic rise in deposits of 11% over 2014, now at OMR15.3 billion. For 2014, inflation is expected to average at 2%. Monetary policy is somewhat driven by developments in the dollar, to which the Omani riyal has remained pegged for years. The Central Bank of Oman (CBO) acts as both the monetary authority and banking sector regulator, and has worked to create an environment of easy liquidity conditions, low inflation, low interest rates on deposits, and surpluses in fiscal and balance of payment positions. The current account deficit stood at 7.5% at end-2013, including FDI inflows of $1.6 billion over 2013, up 56% on the previous year. On the flip side, Oman continues to be a significant foreign investor itself through the State General Reserve Fund (SGRF), which has over $8 billion in assets and a diverse portfolio. In trade terms, Oman exported OMR21.67 billion worth of goods in 2013, OMR14.3 billion of which was oil and gas. Non-oil exports accounted for OMR3.8 billion and re-exports accounted for the remaining OMR3.5 billion. Oman ran a trade surplus of OMR8.5 billion over the year.

Other major drivers over recent years have included telecoms, which, despite mobile oversubscription (penetration stands at 155%), has plenty of room to grow with a mobile broadband penetration rate of 67.4% and government initiatives to boost e-solutions for schools and training centers. Agriculture is also a sector worth keeping an eye on, even though it is of a distinctly fishy nature; the country produces 206,000 tons of the stuff a year, making it self sufficient and able to export around half of its total annual catch. Aside from all things aquatic, however, the authorities hope to boost the popularity of certain products abroad, with dates at the top of the list; over 300,000 tons of the sticky delights were produced in 2013, yet just 27,000 tons were exported. Another upcoming sector is tourism, which received quite the confidence boost when Oman was named leading 2014 Tourism Destination for the Middle East by the World Tourism and Travel Council (WTTC). Approximately 2.2 million tourists arrived in Oman in 2013, with the figure for 2014 expected to be 14% higher. The sector's contribution to GDP stands at 2.6%, according to the WTTC. The development of six new international airports, at Salalah, Duqm, Ras Al Hadd, Adam, and Sohar, is also likely to boost the number of incoming visitors, whether arriving to soak up the sun or participate in a spot of business.

All in all, Oman is making the most of its oil revenues, pushing an expanded investment agenda aimed at paving the way to more diverse revenue generation. A number of sectors are looking to be new drivers of growth, and SMEs are undoubtedly set to play an increasing role, although it will be many years before the hydrocarbons business steps fully into the shadows.