Oman is in talks with three of its GCC peers to secure a multi-billion dollar deposit in its central bank, which could help the sultanate in boosting its foreign reserves and reduce pressure on its currency.

Officials from Oman have meet with representatives of finance ministries of Kuwait, Qatar and Saudi Arabia to discuss the matter, according to news agency Reuters, which cited unnamed sources familiar with the talks.

The discussions are at early stages and a Qatari official has confirmed they are under way.

Oman last week also approached banks to submit proposals to help it raise funds through the sale of an international bond as the sultanate seeks to plug a budget deficit. It could raise a dollar or an Islamic bond and the government is expected to receive responses from the banks imminently.

Oman could run a budget deficit of RO3bn in 2017, which is equivalent to 35 per cent of the government revenues and 12 per cent of the country’s GDP.

The expected deficit comes after a challenging 2016 for the Omani economy as oil revenues dwindle. The budgeted deficit for 2016 was RO3.3bn.