Economy
From The Report: Oman 2023
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Due to the hydrocarbons-focused nature of its economy, the sultanate was not immune to the global economic shocks of the past decade. The government is therefore pursuing broad economic diversification, with specific sectors strategically targeted for development. While this is a familiar narrative across the GCC, motivated in large part by the global transition to clean energy, the need for diversification in Oman is perhaps more pressing due to the limited lifespan of its oil and gas supply – the former is estimated to last until 2030, and the latter up to 10 years longer based on current rates of extraction. The government has rolled out a number of new laws in order to create a more accommodating legislative environment for local and international investors, while current economic development plans seek to harness the country’s strategically advantageous location on
the Gulf and proximity to key regional consumer markets.

This chapter contains interviews with Abdulsalam bin Mohammed Al Murshidi, President, Oman Investment Authority; Qais Al Yousef, Minister of Commerce, Industry and Investment Promotion; and Faisal bin Abdullah Al Rawas, Chairman, Chamber of Commerce and Industry.

Articles from this Chapter

Overview

Forward drive: The government is rolling out legislation to foster an enabling environment for local and international investment
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Due to the hydrocarbons-focused nature of its economy, the sultanate was not immune to the global economic shocks of the past decade. The government is therefore pursuing broad economic diversification, with specific sectors strategically targeted for development. While this is a familiar narrative across the GCC, motivated in large part by the global transition to clean energy, the need for diversification in Oman is perhaps more pressing due to the limited lifespan of its oil and gas supply –…

Interview

On the right track: Abdulsalam bin Mohammed Al Murshidi, President, Oman Investment Authority (OIA), on attracting foreign investment
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Interview: Abdulsalam bin Mohammed Al Murshidi To what extent are rising interest rates and inflation affecting plans to achieve a diversified economy? ABDULSALAM BIN MOHAMMED AL MURSHIDI: Oman’s economy has recovered from the Covid-19 pandemic, with nominal GDP estimated to exceed $100bn in 2022 compared to $74bn in 2020. In addition to a significant contribution from the energy sector, other areas of the economy have contributed to the expansion, particularly industry. While rising interest rates…

Interview

Shifting focus: Qais Al Yousef, Minister of Commerce, Industry and Investment Promotion, on facilitating business investment
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Interview: Qais Al Yousef Which measures have been taken to create a pro-enterprise environment? QAIS AL YOUSEF: Highlighting the sultanate’s progress in efforts to expand opportunities in the business environment and attract foreign direct investment (FDI), Oman was named fourth in the FDI Standouts Watchlist 2023, a study that assesses the world’s top-50 investment destinations. The National Programme for Investment and Exports Development, known locally as Nezdaher, has been helping international…

Analysis

Inclusive measures: A series of development plans seek to promote economic growth and employment while tackling the fiscal deficit
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Oman’s 10th five-year development plan, which runs from 2021 to 2025, aims to accelerate economic diversification, foster private sector development and strengthen fiscal stability. The strategy is anchored on the strategic priorities of the long-term Oman Vision 2040 development agenda and builds on the ninth fiveyear plan spanning 2016-20, which aimed to promote human capital development, diversified economic activity, fiscal sustainability and balanced growth across the sultanate’s 11 governorates.…

Interview

Market strength: Faisal bin Abdullah Al Rawas, Chairman, Chamber of Commerce and Industry, on measures to boost exports and investment, and safeguard against future economic headwinds
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Interview: Faisal bin Abdullah Al Rawas How do you assess Oman’s efforts to enhance its competitiveness on a global scale? FAISAL BIN ABDULLAH AL RAWAS: The government has adopted several policies to ease the intensity of economic fluctuations, such as the restructuring of public finances at the expenditure and revenue level through a value-added tax, and the reduction of subsidies. In addition to establishing new employment rules in the public sector and spending more on investment projects, a…

Analysis

The competitive edge: Harnessing artificial intelligence technology to bolster economic growth and strengthen sustainability
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As part of ongoing efforts to diversify their economies and build a platform for sustainable future growth, MENA nations are increasingly turning to artificial intelligence (AI). A slew of recent investment and initiatives – primarily in academia and the government, but also in the private sector – has reinvigorated interest from industry leaders around the globe in the potential for AI to strengthen the efficiency and sustainability of MENA economies. AI could bring about an additional $320bn…

Analysis

Positive outlook: Surpluses from oil revenue are enhancing regional integration and economic diversification among GCC countries
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While 2022 was a year of global economic uncertainty fuelled by inflation, geopolitical crises and supply chain insecurity, the Middle East witnesseda second consecutive year of economic growth, with countries in the region investing in new technologies and projects that could herald greater integration in the years ahead. Whereas in October 2022 the IMF’s “World Economic Outlook” projected that global GDP expansion would slow from 6% in 2021 to 3.2% in 2022, sustained high oil prices…

Analysis

Greenlighting bonds: Markets around the globe are increasingly issuing green and social bonds in an effort to support sustainable growth
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Alongside significant political efforts to speed up the energy transition, green finance has been a key tool in financing growth, as governments, international institutions and lenders alike seek to support the shift towards renewables. The issuance of green bonds – financial instruments that fund environmentally sustainable projects – hit a new record of $596.3bn that year, according to the Climate Bonds Initiative. While this figured ticked down to $443.7bn in 2022, the UK-based organisation…