The country posted a budget surplus of $545 million in the first two months of this year. Image Credit: Supplied

Muscat: Oman will split its wealth fund, one of the smallest managers of state capital into two units overseeing local and foreign assets.

The National Development Portfolio, which includes more than 160 companies and manages local assets, will help support the state’s general budget through dividend distributions, state-run Oman News Agency said on Sunday. This arm will look to attract private sector investors and may privatize firms.

The second unit, called the Generational Portfolio, consists of mostly foreign assets and will focus on “achieving the greatest returns for future generations.”

The Gulf country combined its wealth funds two years ago into one entity, holding assets valued at about $17 billion.

Oman pumps around 830,000 barrels of crude oil a day. While it’s not a member of the Organization of Petroleum Exporting Countries, it is part of the wider, 23-member OPEC+ alliance. The sultanate’s state companies include energy firms OQ SAOC and Petroleum Development Oman.

The government has implemented a series of reforms to balance its budget and lower its debt since Sultan Haitham Bin Tariq came to power in 2020, including the introduction of value-added tax. It plans to use the windfall from oil’s surge to more than $100 a barrel to trim public debt, which surged during the pandemic and boost spending on developmental projects.

The country posted a budget surplus of $545 million in the first two months of this year. That compared with a deficit of 457 million rials ($1.2 billion) a year ago, according to Oman’s finance ministry.