Current Account Balance
Definition
The current account balance measures the difference between a country’s total exports of goods, services, and transfers and its total imports of the same. A positive balance indicates a surplus, meaning the country earns more from the rest of the world than it spends.
Context
Oman’s current account balance fluctuates primarily with oil export revenues. High oil prices typically produce surpluses, while low prices lead to deficits. Expatriate remittances represent a significant outflow, as foreign workers send a portion of their earnings to their home countries.
Example
When Oman exports crude oil worth fifteen billion dollars while importing goods and services worth twelve billion dollars, and accounting for remittance outflows, the net current account position determines whether the country is a net lender or borrower internationally.