Improving Public Debt Management
In the OIC Member Countries
163
B) Public Debt ManagementGovernance and Strategy Development
Legal frameworkAccording to the Royal Decree 39/96 the Ministry of Finance (MoF) of Oman has the “authority
to borrow on behalf of the Government and keeps records of the government’s financial
transactions” (Central Bank 2011, p. 6). However, there are no legal rules which “specify the
purpose of borrowing, limits of borrowing and objectives of debt management strategy”
(Central Bank 2011, p.6). Organizationally, the Supreme Council of Planning collects
information on the financing needs of the ministries. The Financial Affairs and Energy Council,
composed of ministers from different concerned authorities, then decides on the allocation of
funds and sets the guidelines for the debt management strategy. The MoF has the authority to
borrow according to these guidelines.
According to the Banking Law 2000, the Central Bank of Oman (CBO) can take loans that are
guaranteed by the government. The CBO can also issue its own securities for monetary policy
operations (Art. 26 of the Banking Law 2000).
Managerial structure (incl. coordination with other policies)While borrowing decisions are made by the cabinet and managed by the Central Bank of Oman,
the management of the resulting debt falls within the scope of the MoF. There are two separate
units in the MoF for debt issuances: the Treasury Department is responsible for domestic debt
issuances and mainly carries out back office functions (i.e. shortterm borrowing, cash
management). The Loan Department is responsible for external debt issuances and carries out
front and back office functions (i.e. negotiation of commercial and development loans).
The Central Bank of Oman performs front office functions for domestic debt as an agency of the
government. The CBO “can borrow funds on behalf of the Sultanate provided the loans are
guaranteed by the Government” (Central Bank 2011, p. 6) and provides a shortterm overdraft
facility to the government up to a certain limit. A committee consisting of MoF and CBO
officials is supposed to meet regularly for the issuance of Treasury Bills and Development
Bonds (DBs).
Under the current structure different departments are responsible for public debt
management. The government plans to found a Debt Management Office (DMO) in order to
have a single authority to be responsible for debt management operations.
Debt reportingReporting of public debt management activities is not mandated as there is no Public Debt Act
in Oman. The annual public state budget is published in the official gazette and on the MoF
website. The CBO also publishes monthly and annual reports on public debt data.
The Sultanate of Oman implemented International Accounting Standards for companies
including the section IAS 37 approaching “Provisions, Contingent Liabilities and Contingent
Assets”. The Sultanate does not publish further information or data concerning statebased
contingent liabilities.
Debt management strategy (incl. risk management)There is no publicly available information about Oman’s public debt management objectives
and risk management. For strictly internal use documents on objectives, strategies and risk
management exist.