Outlook for 2011-12

• The protests that started in Oman in late February are unlikely to die down unless the sultan, Qaboos bin Said al-Said, takes concrete steps to address corruption and unemployment and bring in genuine political reform.
• In spite of anti-government protests, the sultan retains genuine popular support. It is unlikely that the protests, which target ministers and powerful businessmen, will produce the same results as those in Tunisia and Egypt.
• The country remains vulnerable to the effects of any future confrontation over Iran's nuclear programme, given both the sultanate's proximity to Iran and the stationing of Western military bases on its territory.
• The government will increase public spending in an effort to appease the protesters. Economic policy over the forecast period will focus on meeting the employment needs of a young and fast-expanding population.
• We estimate that real GDP grew by 4.5% in 2010 as oil production increased substantially. Real GDP growth will accelerate further over the forecast period, to an average of 4.9%, owing to high oil prices.
• We have revised up our forecast for inflation in 2011 to 4.4% owing to a rise in public-sector wages and pensions. We forecast that average consumer price inflation will fall to 3.9% in 2012 as food prices stabilise.
• The current account is expected to record surpluses in 2011-12, driven by higher oil prices and modest production growth. We forecast an average surplus of 5.7% of GDP in 2011-12, up from 3.5% of GDP in 2010.

Monthly review

• The protests turned violent in Sohar in the first week of April. One person was killed and several others injured as the army was brought in to clear demonstrators from the Globe Roundabout.
• Oman's parliament, comprising the appointed Majlis al-Dawla and the elected Majlis al-Shura, has been granted legislative powers as part of the concessions aimed at calming protesters. No details have been disclosed.
• The government has announced the award of a cost of living allowance for all Omani employees in the public sector and an increase in subsidies.
• The commercial sector has suffered a loss of production as Omani employees in many companies have staged strikes in the hope of winning similar concessions to those offered to Omani employees in the public sector.
• The troubled Blue City real estate and tourism project has been bought by the Omani government from Essdar, a Dubai-based investment company.

The popular protests that started in Sohar in late February are likely to continue, but the threat of an overthrow of the established order remains slight. Although the sultan, Qaboos bin Said al-Said, has made significant concessions both in political and in economic terms, the measures have failed to satisfy protesters. The risk of more protests remains high as young Omanis test limits and push boundaries to see how much the government is willing to concede. As things stand, the Economist Intelligence Unit does not expect the protests in Oman to yield the same results as those in Tunisia and Egypt; they are aimed at ministers and are calling for an end to government corruption. However, if there are more deaths owing to heavy-handed policing tactics or if there are sustained protests, the situation could change rapidly. The intensity of the protests is surprising, since they follow celebrations as the sultan completed 40 years of rule in 2010. The main risk factors include the fact that the sultan retains all decision-making power. The government is appointed by the sultan, who is also the prime minister and holds the defence, finance and foreign affairs portfolios.

The biggest political risk, and one that is likely to further alienate Omani citizens from the political process, is the uncertainty over who will succeed the long-serving sultan. The sultan has no children, and none of the three first cousins widely viewed as the leading candidates to succeed him has yet been trusted with substantial executive power. The most prominent among these is Assad bin Tariq al-Said, who is currently the special representative of the sultan.

The final decision on who will succeed Sultan Qaboos will not be made until after his death, when family members will have three days to choose a successor. Should they prove unable to agree, a letter left by the sultan naming his choice of successor will be opened, and that person will become the new leader. The system is untested and unusual-Arab monarchies tend to have named crown princes. In light of the protests, this unusual method will not sit well with protesters, as it excludes citizens from participating in the transfer of power.

The Council of Oman (parliament) comprises the Majlis al-Dawla (State Council) and the Majlis al-Shura (Consultative Council). Members of the Majlis al-Dawla are appointed by the sultan for a four-year term. Members of the 83-seat Majlis al-Shura are elected for a four-year term by universal suffrage, but the council currently has no legislative powers. However, in response to the protests, the sultan announced in March that the Council of Oman was to be given legislative and audit powers. The change requires an amendment to the country's Basic Law. A draft amendment outlining the change will be drawn up by a committee and presented to the sultan by mid-April. It remains to be seen how significant the Council of Oman's new powers are, and how the power is allocated between the elected and the appointed councils.

Increasing the powers of the Majlis al-Shura has been one of the main reforms demanded by protesters. The next election for the council is due to be held in October 2011. Women are encouraged to participate in elections, but even though a number of women were nominated as candidates by their districts in the election in October 2007, all the seats were won by men.

Oman's ties with its most important international allies-the US and the UK-will remain strong over the forecast period. However, relationships with Asian countries, especially India and China, will continue to strengthen. Oman also has good relations with Iran and will continue to monitor the ongoing dispute over Iran's nuclear programme with some discomfort. In August 2009 the sultan visited Iran for the first time since the 1979 Islamic revolution, signalling Oman's willingness to engage directly with the country during a period of heightened international tension. Oman is therefore likely to maintain cordial relations with its Western allies as well as with Iran. The increasing isolation of Iran from the international community will allow Oman to act as a bridge between the West and Iran, increasing the importance of its role as a mediator.

Oman advocates a strong diplomatic approach to the Middle East's other political issues, including the Israeli-Palestinian conflict. Political instability in Yemen, which has also seen an escalation of protests, will be watched with concern and Oman has already tightened security at the Oman-Yemen border to prevent an influx of Yemenis into Oman. Relations with the UAE have been strained following the announcement of the discovery of a network of spies working for the UAE. There were also rumours alleging that the UAE was behind the protests in Oman, although there is no evidence to support this theory. Given the political, economic and military importance of Oman's historical links to the West, we expect no change in the sultanate's pro-Western foreign policy in 2011-12.

The government will continue to pursue reforms that lead to diversification away from oil and gas and that promote non-oil exports. However, the immediate focus will be on increasing the number of jobs for Omanis in both the public and the private sector and, it is hoped, providing Omani students with the relevant qualifications to make them employable in the job market. The new eighth five-year development plan (2011-15) allocates more than OR1.5bn (US$3.9bn) to the development of non-oil exports and infrastructure development. However, the government will also invest in increasing Oman's crude oil production. A shortage of gas may cause some projects to be delayed. Plans to expand gas production are under way with a total of OR412m (US$1bn) set aside. Tourism will play a key role in diversifying revenue. Efforts to increase the role of the private sector in large-scale projects will continue. We have increased our oil price forecast for 2011 to an average of US$101/barrel for Brent Blend, and Oman is financially well positioned to withstand a fall in oil prices as it has based its 2011 budget on a price of US$58/b.

The government will intensify its "Omanisation" policy (the replacement of expatriate workers with local staff) in light of the protests. It will focus on educating and training Omanis to develop local professional and technical expertise. The authorities recently increased the minimum wage for Omanis employed in the private sector by 43%, and we expect other such measures to be implemented, although they will have a limited impact on stemming the protests, if they are not accompanied by political reform. The private sector will come under pressure to meet targets to increase the number of jobs for Omani citizens, while cracking down on illegal workers in the country. Despite changes to the Labour Law, however, supply-side problems are likely to continue to slow progress on Omanisation.

The 2011 budget projects a 14% year-on-year rise in revenue to OR7.3bn and a 13% increase in expenditure to OR8.1bn, implying a budget deficit of OR850m. However, we expect spending to rise more sharply, to OR8.5bn, as the government increases subsidies, unemployment benefits and other handouts in an attempt to prevent more protests. The government has announced a raft of measures aimed at increasing the salaries of Omanis in the public sector as well as a rise in subsidies for basic food products. It is probable that the government will announce some sort of pay package for Omanis in the private sector as well, but this will hit profitability. We have increased our forecast for oil prices in 2011 to an average of US$101/b, since prices are likely to rise as risk premiums in the oil market widen on the fear that protests might spread to other oil-exporting countries in the region. We estimate that government revenue increased by 18% year on year, to OR8bn, in 2010 as a result of increases in oil production and oil prices. We have revised up further our forecast for revenue in 2011 to OR9bn as a result of the revision to our oil price forecast. We expect the budget surplus to widen to 2.1% of GDP in 2011. Increased expenditure in 2012 will lead to a narrowing of the surplus, to 0.7% of GDP.

Monetary policy will be largely unchanged in 2011-12, and there will be little pressure on the Omani riyal's peg to the US dollar. Confidence in the peg is underpinned by a decision, announced by the executive president of the Central Bank of Oman, Hamood Sangour al-Zadjal, not to join the proposed Gulf Co-operation Council (GCC) single currency. This represents a shift from Oman's original position, which was to delay joining the currency until after 2010. The authorities have resisted pressure to revalue the riyal, insisting that the peg will remain in place for the foreseeable future. Omani lending rates are forecast to average around 7.4% a year in 2011-12.

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Growth figures released by the Ministry of National Economy for 2009 put real GDP growth at 1.1%. We estimated real GDP growth of 4.5% in 2010 based on the significant increase in oil production, which stood at 865,000 barrels/day, owing to enhanced oil recovery (EOR) techniques. We forecast that growth will increase to 4.7% in 2011 on the back of higher oil prices fuelled by the regional unrest and will rise further to 5% in 2012 owing to a rise in private and government consumption as well as increased spending.

The Omani economy will remain vulnerable to any downturn in domestic oil production and to fluctuations in oil and gas export prices. GDP growth will continue to rely on the hydrocarbons sector, but as oil extraction becomes increasingly difficult and expensive, the diversification programme will become more important. Oil and gas accounted for just over 40% of GDP in 2009 (compared with just over 50% in 2008). Liquefied natural gas (LNG) production will rise modestly over the forecast period, but insufficient gas reserves mean that even with plans for a fourth LNG train, exports will remain subdued. The expansion of ports, the diversification into manufacturing (such as aluminium production) and the development of tourism infrastructure will boost non-oil exports, although there is a risk that these will be affected by the protests in major industrial areas such as Sohar and the Rusayl Industrial Estate. A major downside risk to our growth assumptions is the escalation of protests in the sultanate and the shortage of gas supplies; gas is used in EOR, desalination and electricity generation for heavy industries such as aluminium and fertilisers.

We estimate that consumer price inflation averaged 3.4% in 2010. Oman imports the majority of its food products. We have revised up our forecast for inflation in 2011 to 4.4% owing to an expansionary fiscal policy and a rise in the prices of basic food items, such as wheat, and industrial raw materials. Inflation is forecast to fall to 3.9% in 2012 as prices stabilise. Inflation in the forecast period is expected to be much lower than in 2007-08, when it averaged 9.2%. However, it remains high by Omani standards. Consumer prices are constrained by the government's extensive subsidy system, which holds in check the prices of a range of core goods and services.

Oman's fixed exchange rate of OR0.385:US$1 is unlikely to come under pressure in 2011-12. The Central Bank remains firmly committed to the peg, which it has maintained since 1986. The outlook for Oman's external accounts and foreign asset levels is still sufficiently robust to enable the Central Bank to defend the peg. Oman's decision not to join the planned GCC currency union also means that the peg is less likely to be adjusted in response to any revaluations of the currencies of the other Gulf countries.

Having widened in 2010, the trade surplus is expected to increase further in 2011, buoyed by higher oil prices, but will narrow in 2012 as oil prices fall and production increases modestly. Exports are forecast to grow by an average of 10.7% in 2011-12, boosted by higher oil prices and the continued development of Oman's sea ports, which will increase re-export trade, provided the protests do not escalate. The trade surplus is forecast to widen to US$20.4bn in 2011, before falling to US$17.7bn in 2012.

The services deficit is forecast to widen in 2011-12, despite plans by the government to develop infrastructure to attract tourists. Any increase in tourism receipts will be offset by a rise in payments to cover the cost of EOR projects. We forecast that the non-merchandise deficit will widen to an average of US$15.4bn in 2011-12. The current transfers deficit will increase to an average of US$5.5bn in 2011-12. The current account moved from a deficit in 2009 to an estimated surplus (of 3.6% of GDP) in 2010. The surplus is forecast to widen significantly in 2011 before narrowing in 2012, averaging 5.7% in 2011-12.

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Following three weeks of relative calm, violence flared again in Sohar at the beginning of April. One person was killed and several others injured, as angry protesters gathered after Friday prayers demanding the release of those arrested a few days before when the government attempted to bring a month of countrywide protests and strikes to an end by using the army to clear demonstrators from Sohar's Globe Roundabout. According to a statement released by the Public Prosecution Office, some of the protesters were armed and began shooting at the security forces who responded using rubber bullets, wounding five protesters.

Throughout March, the authorities alternated between forcible attempts to clear the demonstrators, and negotiation and concessions. For the final two weeks of the month the government appeared to be playing a waiting game, presumably hoping that the demonstrators would eventually accept the concessions that had been made, pack up and go home. Although there have been equally large and lengthy protests in other parts of the country, most notably in Salalah and Muscat, the capital, these have been completely peaceful. By contrast, violence and the subsequent death of at least one protester in the early days of the demonstrations in Sohar in late February have made the coastal town a focal point for national unrest. Furthermore, the occupation of the roundabout and the subsequent blocking of the main highway between Muscat and the UAE-the most economically important route in the country-resulted in the Sohar protests causing daily inconvenience and economic damage in the town that has been the focus of Oman's successful attempts to attract foreign investment into economic diversification projects.

Public reaction to the clearance of the Sohar demonstration seemed favourable, but the death of another protester may well inflame the situation once again. Although there has been general support for many of the demonstrators' complaints, particularly about low wages and government corruption, there was also widespread condemnation of the violence and vandalism that marked the early stages of the protests in the town. With so many concessions having been made, the Sohar demonstrators' additional demands, such as a minimum monthly wage of OR500 (US$1,299) for Omanis, looked increasingly unreasonable. Lately there has been public bewilderment over why the sultan, Qaboos bin Said al-Said, has not chosen to speak directly to the nation to explain the concessions that have been made, and ask for calm to be restored. All comments from the sultan about the protests have come second hand to the public, such as the official press release following the meeting of the new cabinet in mid-March at which the sultan spoke about the need for transparency, and for everyone to co-operate to maintain security and stability.

The initial demonstrations were met with a flurry of concessions in the form of royal decrees. Far from calming the situation, as the sultan may have hoped, the wider public appear to have become emboldened by the protesters' success. After decades of government and self-imposed censorship, the flood gates of pent up frustration were opened. Groups all over the country found their collective voice, and strikes and sit-ins affected a wide range of private and public institutions, with a mixture of demands of which some were reasonable and many were not. Among the latter were calls from some students for the pass marks in their examinations to be lowered.

In recent years the sultan has limited his direct role in government, relying on his ministers to deal with the day-to-day running of the country. This may have been partly to delegate more responsibility to his cabinet members, but also a reflection of the fact that, at 70, he is of an age when most people are enjoying retirement. The events of the past few weeks have forced him back into the driving seat. After widespread changes at the highest level he has lost his experienced and previously trusted team, and is now in charge of a cabinet in which many have not held ministerial posts before. The scale of the changes, combined with recent airing of the public's anger at high-level corruption, is likely to have a paralysing effect on the government in the coming months.

The Council of Oman (parliament) is to be given legislative and audit powers as part of the package of concessions aimed at calming protests in March. The council consists of the Majlis al-Dawla (State Council), the members of which are all appointed, and the elected Majlis al-Shura (Consultation Council). The Majlis al-Shura's lack of power has been one of the main complaints of the protesters; indeed the parliament building near Muscat International Airport quickly became one of the focal points for demonstrations in the capital. The change requires an amendment to the country's Basic Law. A draft amendment outlining the change will be drawn up by a committee and presented to the sultan by mid-April. It remains to be seen how significant the Council of Oman's new powers are, and how the power is allocated between the elected and appointed councils.

The influence of the Majlis al-Shura had already received a boost earlier in March when seven serving or past members were appointed to senior government posts in a major government reshuffle. Preparations are under way for an election for the Majlis al-Shura, which is due to take place in October 2011. Nominations for potential candidates took place in late January and early February. If the recent royal decree is perceived to have handed genuine power to the elected council, this could energise the upcoming election.

Over the past 30 years of his 40-year reign the sultan has slowly, but surely, been taking steps to increase public participation in the political system. In 1981 he created the State Consultative Council, whose members were appointed by sheikhs and dignitaries. In 1991 this was replaced by an elected body, the Majlis al-Shura, the first of its kind in the six-member Gulf Co-operation Council. The Majlis al-Shura is now an 83-member body for which all Omani citizens over the age of 19 may vote. Women have stood as candidates since 1994. As well as broadening the candidacy and eligibility to vote criteria, the government has gradually widened the range of matters on which the council is consulted, to include, most recently, the revision of draft laws and the drafting of the state general budget and the five-year development plans. Although there has been undoubted progress, a common theme of the recent demonstrations has been widespread hunger for more power to be devolved to the people, albeit coupled with unwavering support for the sultan. The public are increasingly aware that the sultan, at 70 years of age, may not be on the throne for many more years, and uncertainty caused by the lack of a named successor is mounting. The events of March 2011 could well turn out to have given the process a timely nudge in the right direction.

The government announced the introduction of an allowance for public-sector employees to meet the rising cost of living, together with increased subsidies and price fixing for essential commodities. Low wages and high prices were two of the most frequently heard complaints of protesters during the recent demonstrations. In mid-March the sultan ordered that the monthly allowance be paid to all government employees, including the military. The allowance ranges from OR50 (US$130) for the highest-grade employees to OR100 for the lowest-grade ones. Government officials have claimed that the increased payments have been awarded with the explicit purpose of boosting domestic consumption, as opposed to merely caving in to protesters' demands. The Economist Intelligence Unit forecasts that average oil prices (Brent Blend) for 2011 will be US$101/barrel, but the 2011 budget was set using an assumed price of US$58/b, so for this year, at least, the government can afford the increase.

A week later the Council of Ministers (cabinet) announced that it was increasing subsidies on some commodities and fixing the price of others. No further details of the subsidies were announced. The government has been taking steps to improve Oman's food security and stabilise food prices since global food prices last increased dramatically in 2008. In early March the Ministry of Commerce and Industry signed an agreement with a Greek agro-engineering company, TAME, for the design and construction of wheat silos in Sohar and Salalah. Rashid al-Masruri, the ministry's food security chief, told an English-language newspaper, Muscat Daily, in January that Oman currently has a year's supply of rice. Mr Masruri said that the government was also increasing its capacity to store sugar and rice. Meanwhile, the Ministry of Agriculture and Fisheries instituted a seven-month export ban on five species of fish-hamour, tuna, kingfish, sole and emperor-starting on March 1st 2011. The ban is an attempt to ensure a good supply of fish to local markets at reasonable prices.

Productivity was hit across a wide range of businesses in March when Omanis working in the commercial sector staged protests or came out on strike, hoping to win similar concessions to those awarded to public-sector employees earlier in the month. Many sectors of the economy were affected. Among the disputes reported by the local media were those at Petroleum Development Oman (PDO, the national oil and gas company), Omantel (the majority state-owned telecommunications firm), banks (BankMuscat, Oman International Bank and Oman Arab Bank), oil refineries, hotels (Al Bustan Palace, InterContinental, Shangri La) and construction companies (Larsen & Toubro, Galfar).

The banking sector illustrates how the responses by management to protesters' demands have varied. More than 60 of Oman International Bank's branches were closed for several days by strike action in mid-March, angering customers who were unable to access their money. The bank responded by giving customers a month's loan repayment waiver, while threatening staff with the sack or prosecution if they did not return to work. By contrast, BankMuscat and the Oman Arab Bank increased the wages of Omani staff. Some changes were imposed upon the banks: at the beginning of the third week of March, the Central Bank of Oman's board of governors announced it was increasing the Omanisation quotas for banks from 50% to 65% and for financial institutions from 75% to 80%.

As Oman's trade union movement is in its infancy, the strikes were largely unco-ordinated. One exception to this was the action taken at the Rusayl Industrial Estate on the outskirts of Muscat where production was halted as hundreds of workers staged a peaceful protest demanding higher salaries and better working conditions. Rusayl is Oman's largest industrial zone with over 150 companies employing a total of about 6,000 workers, of whom about 40% are Omani according to the Times of Oman, an English-language daily newspaper. The army was dispatched to the industrial estate in order to protect the factories: there have been a number of cases of arson, vandalism and looting associated with the protests in Sohar and Ibri. The Public Establishment for Industrial Estates (PEIE), which operates nine such estates throughout Oman, negotiated with the protesters. It then sent a communiqué to tenants at Rusayl and elsewhere directing them to pay a monthly OR50 (US$130) cost of living allowance to Omanis on monthly salaries of less than OR500 and OR30 for those on higher salaries, in addition to giving them a two-day weekend. Coming within weeks of a OR50 increase in the minimum monthly wage for all Omanis in the private sector, the net result of the recent concessions for employers on the industrial estates is a 66% increase in the minimum wage for Omanis and one day a week less production. By late March stories were filtering into the local media that some small and medium-sized firms were considering ending their operations in Oman because of increased costs.

Oman's heavy dependence on low-paid Asian labour was relatively straightforward to manage when the workplace was in effect segregated. From the 1970s to the 1990s many, largely physical, jobs such as construction, factory work and domestic service were performed almost exclusively by expatriates. The large numbers of young Omanis leaving school and looking for work prompted the government to begin its Omanisation programme in the late 1980s, introducing quotas for the percentage of nationals companies were required to employ. Not surprisingly, those sectors of the economy that rely heavily on low-paid Asian labour were unpopular with Omanis. Although the higher pay and improved conditions may appease Omani employees to some extent, they in effect further disadvantages the most poorly paid: the Asian expatriates. The real problem for Oman's economy will come if the 84% of the workforce that is expatriate finds its voice.

The government was finally forced to bail out the beleaguered Blue City real estate and tourism project to avoid the site being sold by the current owners of the project's debt bonds, Essdar, a Dubai investment company part-owned by Emirati royals. According to an Emirati newspaper, The National, Onyx Investments, a wholly owned subsidiary of the state-owned Oman Investment Fund, has bought nearly all of Blue City's senior debt from Essdar. Essdar bought US$655m of the struggling project's debt at a considerable discount in 2010. It originally intended to restructure the project using the powers designated to the senior bond holders. As legal complexities prevented this, Essdar was planning to sell the land and foreclose on the project. The Omani government stepped in at this point, presumably to maintain some control over the fate of the 25-sq km site.

Blue City, or Medinat al-Zarqa, was to have been a town for 200,000 people, 45 minutes' drive from Muscat, incorporating hotels, a marina and a golf course. No details have officially been released about how much the government paid for the debt bonds, or its plans for the project, but sources have suggested that it was in excess of US$500m. The end result of this sorry story is that a huge amount of government money has been used to buy back the land, which was no doubt sold to the developers at a considerably discounted price in the first place. Those in charge blamed the 2008 downturn in the Gulf property market for the foundering of the project's fortunes. The Omani company behind the project is Cyclone LLC, the co-owners of which are Anees Issa Mohammed al-Zadjali, who is also the company chairman, and Sayyid Haithem bin Tariq al-Said. Sayyid Haithem is the heritage and culture minister, a cousin of the sultan's, who has in the past been tipped as a possible successor. The project instigator and developer was a Bahraini, Ahmed Abubaker Janahi. An early ownership dispute between Cyclone and Mr Janahi's company, AAJ Holdings (AAJH), saw Cyclone take control of the 70% of the project owned by AAJH. A series of lawsuits brought by Mr Janahi failed to overturn the decision. However a substantial amount of debt financing, amounting to over US$900m, has been raised towards the project.

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Please see graphic below

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Land area

309,500 sq km

Population

2.87m (2008 Ministry of National Economy mid-year estimate), including 900,000 expatriates

Main regions

Population (2008)

Muscat (capital): 834,760 Dhofar: 273,052

Al Batinah: 760,454 Al Dhahirah: 258,567

Al Sharqiyah: 367,966 Musandam: 35,473

Al Dakhiliyah: 308,730 Al Wusta: 28,426

Climate

Coastal areas, especially Batinah and Muscat: very hot and humid in summer; winters mild. Interior desert: summers hot and dry; winters cool. Dhofar receives monsoon rains in June-September

Weather in Muscat (altitude 5 metres)

Hottest month: June, 31-38°C (average daily minimum and maximum). Coldest month: January, 20-25°C. Driest months: July and August, 1 mm average rainfall. Wettest month: January, average rainfall 28 mm, but considerably higher on Hajar mountains in the interior

Languages

Arabic; English, Urdu, Baluchi and Swahili are also widely used

Measures

Metric system

Currency

Omani riyal (OR) = 1,000 baisa. The currency is pegged to the US dollar at OR0.3845:US$1

Time

4 hours ahead of GMT

Public holidays

The Islamic holidays-Eid al-Fitr (end of Ramadan, August 30th 2011), Eid al-Adha (Feast of the Sacrifice, November 6th 2011), Islamic New Year (November 26th 2011) and Mawlid al-Nabi (the birthday of the Prophet, February 15th 2011)-are public holidays, the dates of which vary according to the lunar calendar and are therefore approximates. New Year's Day (January 1st), National Day and birthday of Sultan Qaboos (November 18th), and New Year's Eve (December 31st) are also public holidays

Official name

Sultanate of Oman

Form of state

Monarchy

Legislature

There is no national legislature. The Council of Oman debates policy but does not legislate. It comprises the 83-member Majlis al-Shura (Consultative Council), which was elected by universal suffrage in 2007-the next election is in October 2011-and the Majlis al-Dawla (State Council), whose members were appointed in November 2007

Head of state

Qaboos bin Said al-Said assumed power in July 1970

Executive

The sultan rules by decree, assisted by the Council of Ministers (cabinet). The most recent cabinet reshuffle was in March 2011

Main political parties

Political parties are not permitted

Adviser of the sultan

Shihab bin Tariq al-Said

Personal representative of the sultan

Assad bin Tariq al-Said

The government

Prime minister, minister of defence, finance & foreign affairs: Qaboos bin Said al-Said

Deputy prime minister for cabinet affairs: Fahd bin Mahmoud al-Said

Key ministers

Agriculture & fisheries: Fuad bin Jaafar bin Mohammed al-Sajwani

Awqaf & religious affairs: Abdullah bin Mohammed al-Salimi

Commerce & industry: Saad bin Mohammed bin Said al Saadi

Defence affairs: Badr bin Saud al-Busaidi

Diwan of the Royal Court: Khalid bin Hilal al-Busaidi

Education: Madiha bint Ahmed bin Nasser

Environment & climate affairs: Mohammed bin Salim bin Said al-Toobi

Foreign affairs: Youssef bin Alawi bin Abdullah

Health: Ahmed bin Mohammed al-Sa'eedi

Heritage & culture: Haithem bin Tariq al-Said

Higher education: Rawya bint Saud al-Busaidi

Housing: Saif al-Shabibi

Information: Hamed bin Mohammed al-Rashdi

Interior: Sayyid Hamoud bin Faisal al-Busaidi

Justice: Mohammed bin Abdullah al-Hinai

Legal affairs: Abdullah bin Mohammed al-Sa'eedi

Manpower: Abdullah bin Nasir al-Bakri

Oil & gas: Mohammed bin Hamad al-Rumhi

Regional municipalities & water resources: Ahmed bin Mohammed al-Shuhi

Social development: Mohammed bin Said bin Saif al-Kalbani

Sports affairs: Ali bin Masoud al-Sunaidy

Tourism: Abdulmalik bin Abdullah bin Ali al-Khalili

Transport & communications: Ahmed bin Salim al-Futaisi

Central Bank executive president

Hamood Sangour al-Zadjal