Interview: Fawzi Al Harrassy
How can the private sector play a larger role in driving economic growth and development?
FAWZI AL HARRASSY: What Oman needs now are more privatisations and to let the private sector take the lead on some aspects of the development process. In many ways, the government still bears the burden of designing, tendering and maintaining most of their projects. Maintenance contracts for buildings and roads can easily be ceded to private companies for a nominal price. These are the contractual elements which can speed up the work; all the government needs to do is assess these areas, and establish a mechanism to work closer with the private sector. Examples from around the world have proved that the private sector brings efficiencies to the workspace. There are plenty of examples, even here in Oman, of how semi-government enterprises, which previously lacked innovation and efficiency, gained in the privatisation process. The banking and ICT sectors managed to do this, and it is high time that the other sectors in the country caught up.
The government is doing a good job of training Omanis for the workforce, but to make this actually work, the private sector needs to own these institutions and the government should step back into a regulatory role. This way, the responsibility for human resources development is shifted to the private sector. We will have to find a way to make such a system work. Previously, the public and private sectors were stuck playing the blame game, while the government pumped funds into the economy for the development of resources, which were not wisely utilised.
It is only through aggressive, strategic dialogue that we can change the model to make sure that going forward this will not happen again. Then the government funds can be invested in training Omanis, with private companies playing a greater role in making sure they have the manpower they need, when they require it.
What more can be done to encourage public-private partnerships (PPPs) in Oman?
HARRASSY: The PPP model has been introduced in many industries in Oman, but there is still room for growth. I feel that the construction sector is one such area, especially in the realm of developing training institutions. When each side has a stake in the outcome, it eliminates many inefficiencies, because neither side can blame the other. There is also room for more partnership on the projects, especially now that the government’s fiscal position is deteriorating. In cases like this, private sector funding can play a role in filling this gap. In many cases, there is room for the private sector to partly or fully fund and develop various infrastructure projects, mainly because we cannot wait for the government to do everything.
Introducing such a model has the potential to greatly speed up the pace of development, but the sector currently does not have the framework to do so. This is very important because it also accelerates economic growth, facilitating bank lending, developing small and medium-sized enterprises, creating jobs and opportunities – the list goes on and on. The best part about it is that the private sector will be doing all of the leg work. The PPP framework is the only way forward, and we do not need to reinvent the wheel; we can simply borrow from success stories around the world. We live in an age where we cannot afford to move slowly. We need a simple model to define the projects, and it is critical that we introduce a mechanism to divide them up for the private sector to conceptualise, partner, build, operate and market. The private sector can do this more efficiently, and the government can enjoy the added knock-on benefits.