The rial is the official currency of the Sultanate of Oman, an Arab nation southeast of Saudi Arabia. This decimal currency is subdivided into thousandths, rather than hundredths,
into a subunit called the baisa. The Omani rial is one of the highest-valued currencies in the world. The only currencies with a higher value are the Kuwaiti dinar, Bahraini dinar and Maltese lira. The Omani rial cannot be called a fully convertible currency because it is illegal to possess or trade the Israeli shekel in Oman. However, no other foreign exchange restrictions are in place. The rial was first issued in 1973 by the Oman Currency Board, which was replaced as the issuing authority the following year by the Central Bank of Oman.
Oman did not have a national currency until 1940. Before that time, the Indian rupee and the Maria Theresa Thaler, a silver coin used for international trade, served as currency. National coins were introduced in 1940 in the Dhofar region of Oman, and coins for use in the rest of Oman began circulating in 1946. These baisa-denominated coins served as the first rial, with 200 baisa making up a single rial. The Indian rupee circulated alongside the rial, and the Gulf rupee began circulating in 1959. In an effort to consolidate currencies in the country, the rial Saidi was introduced in 1970 on par with the British pound sterling. That year, Al Said became the new sultan of Oman and ordered that the Omani rial be introduced in 1973 to replace the rial Saidi.
Oman enjoys a free economy based on oil exports. However, the country’s oil reserves are limited in comparison with other Middle-Eastern countries, and production has been slowing since 2009. Many experts state that the future of Oman’s oil is questionable, but new oilfields continue to be discovered within the borders. Oman also has large natural gas reserves and a host of other minable minerals, including gold, copper, iron, zinc, chromite and dolomite. The recent economic plan of Oman is to diversify by developing industries that will add value to their natural resources. Two of the largest and fastest-growing industries are telecommunications and information technology, but even though the country has a high per capita GDP, many Omanis still engage in subsistence agriculture. High inflation rates have also weakened the value of the rial in recent years.