State blueprint seeks to build a sustainable and secure future by expanding the non-oil side of the economy
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| Education and training are seen as crucial to prepare the growing and predominantly young Omani population for the challenges of economic deregulation and competition |
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wealth has helped to transform the southern Arabian state of Oman over
the past 30 years into a modern economy with free universal education
and an enviable public health service. There is an efficient transport
infrastructure, a sophisticated financial system and a high standard
of living for the country’s 2.5 million people. This giant leap
forward has taken place against the background of a stable political
culture and prudent economic management.
After a period of such rapid and sustained
growth, government planners in the capital, Muscat, are starting to
re-think their priorities. Oman’s Vision 2020 blueprint seeks to
build a sustainable and secure future for the country in the coming
years by expanding the non-oil side of the economy. It also seeks a
role for the growing Omani population, of which half are under the age
of 18.
The creation of jobs in areas such as trade, tourism and services
is crucial, as is the need for proper training. At present, more than
500,000 of Oman’s people, roughly 20 per cent, are foreigners,
mostly from South Asia.
HE Dr Abdulmalik Al-Hinai, Under-Secretary for Economic Affairs
at the Ministry of National Economy, says Oman is especially keen to
stimulate the private sector and drum up investment to provide new jobs
and opportunities. There is ongoing talk of competition, liberalisation
and privatisation, an indication of the government’s intentions.
Oman’s straightforward approach is typified in the financial
sector, where it is renowned in the region for its openness. “We
have emphasised transparency to avoid financial complications,”
he says. “Recently an international financial team confirmed that
Oman is one of the few countries in the world which complies with all
international recommendations to fight money laundering, so we have
very high standards.”
Accession to the World Trade Organisation (WTO) and membership
of the Gulf Cooperation Council (GCC) has also opened up the Omani economy.
While the government has always been pro-business there is renewed vigour
in its efforts to draw investment from abroad and nurture entrepreneurial
skills. Foreign partners are welcome, especially from the UK, which
shares a long history of friendship with Oman.
Stuart Laing, British Ambassador, says the partnership is now
extending beyond trade and defence to other areas such as training and
education. The British Council and various British universities also
have ties here.
It is not hard to find British companies that have made their
name in Oman. International Power is developing the Al Kamil power station,
while Carillion Alawi (formerly Tarmac Alawi), is a long-lasting example
of a successful British-Omani partnership in construction. The recent
privatisation drive has also provided new opportunities. BAA is leading
the public-private sector team that will manage the country’s main
airports, Seeb International in Muscat and Salalah. The 25-year concession
agreement will bring investment to around £146 million.
Colin Hobbs, Chief Executive of Oman Airports Management Company,
the BAA consortium that won the contract, says there are big plans for
the future including doubling capacity and improving the overall image
of the airports. “It will be very customer-focused,” he says.
“You will not have the glitzy shops like in Dubai, but you will
have small, beautiful stores with a uniquely Omani feel.”
The rejuvenation of the airports is expected to help lift tourism,
something the government hopes will lead the way in terms of job and
wealth creation. The country, with its deserted beaches, rugged mountains
and warm hospitality, has plenty to offer.
National telecommunications firm, Omantel, is also working alongside
British partners like BT as it prepares for eventual privatisation.
Mohammed Ali Al-Wohaibi, Executive President, says the company is looking
to improve quality and service as well as to widen its range, which
already includes state-of-the-art broadband and other digital services.
It is currently implementing a £800 million investment programme.
“Omantel will soon be facing the competition,” he says. “It
has to be prepared through an internal transformation process.”
IT is another growth area. E-commerce firm Oman TradaNet, handles
business-to-business transactions for clients like oil giant Petroleum
Development Oman and Muscat Municipality. At a time when others are
running for cover, this IT firm is posting healthy profits and looking
to float on the flourishing Muscat Securities Market.
Alan Livingstone, Chief Executive, says the government’s
partnership and approach to the private sector and its attitude to change,
is a major source of reassurance. “You have very innovative ministries
which are very keen to adapt new technologies quicker,” he says.
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