Economic impact of pandemic and way out explored
MUSCAT: Heavy investment in innovation and digitalisation and an even more effective distribution of fiscal stimulus packages to COVID-hit firms are among the recommendations of a study into the impact of the pandemic on the economy of Oman.
The study, led by Dr. Ashraf Mishrif, OCCI Chair in Economic Studies at Sultan Qaboos University, and funded by the COVID-19 Research Programme of the Ministry of Higher Education, Research and Innovation is titled ‘The Impact of COVID-19 on the Omani Economy’.
Dr Mishrif and his team aimed to provide an in-depth analysis of the impact of the COVID-19 pandemic on the Omani economy and the amount of the damage done to key sectors. The findings were based on primary and secondary data gathered through the design and distribution of survey questionnaires as well as semistructured interviews with government and corporate officials, business owners and managers.
According to Dr Mishrif, the impact has been severe as the economy heavily depends on the hydrocarbon sector, which accounts for 30 per cent of the GDP. Lockdowns and immobility resulted in a big drop in factory and commercial centre activity due to fall in demand of products and services. Initial investigations show that most sectors have suffered significant revenue and workforce losses due to frequent border closures, service interruptions, demand drops and supply shortages. For the economy to flourish, Dr. Mishrif has recommended a series of actions on the basis of his study. He recommended that the government and private sector enterprises must heavily invest in innovation and digitalisation to upgrade the economic and civil institutions in a way that accelerates the engagement with the technological advancement of the fourth industrial revolution, and that the government has to find more effective mechanisms to distribute fiscal stimulus packages to companies affected by the COVID-19 pandemic, as many of the small and medium sized enterprises interviewed by the researchers complained that they did not benefit from these schemes.