Oman Desk
Oman is celebrating its 50th National Day on November 18 in the backdrop of unveiling of the second Renaissance scripted by His Majesty Haitham bin Tarik. The second Renaissance draws from Oman 2040 and a series of Royal decrees with a focus on good governance, performance, integrity and accountability, which were spelt out by His Majesty the Sultan in his address to the nation on February 23, after paying respects to his predecessor’s achievements in building the modern Omani state.” His Majesty Sultan Haitham’s ascension to the throne took place amid an outpouring of grief and condolences for the passing of Sultan Qaboos and a strong showing of Omani unity in support of the new sultan.
The transition of power was smooth, with the Royal Family unanimously accepting the late Sultan’s will, sending an important message to the world that the change in the leadership is a natural extension of the values and principles of unity, justice, peace and cohesion that have been deeply rooted in Omani society since its inception.
Since the beginning of the blessed Renaissance in 1970 under the wise leadership of late His Majesty Sultan Qaboos, the Sultanate embarked on a journey of continuous self-sustaining growth, and constant engagement with the world.
New government
In his first address to the nation, His Majesty Haitham bin Tariq, vowed to maintain Oman’s foreign policy of his predecessor — peaceful coexistence and maintaining friendly ties with all nations.
“We will continue to follow in the same course the late sultan adopted … embracing foreign policies based on peaceful coexistence among peoples and countries without any interference in the domestic affairs of other states,” he said in a speech broadcast on state television.
Oman’s stable and consistent foreign relations, based on the principles of neutrality, non-interference, and mediation have made the country different from many other global and regional powers.
His Majesty Sultan Haitham has extensive experience in foreign affairs, having worked as an undersecretary and secretary-general in the foreign ministry.
The firm and consistent principles upon which Omani foreign policy is based are not merely theoretical concepts. They are basic precepts that are intimately linked to the country’s history, traditions, geographical location, and its relations with other countries.
As pledged by the Sultan to “take the necessary measures to restructure the state’s administrative apparatus” in order to “achieve good governance, performance, integrity and accountability,” he signed a series of Royal Decrees to restructure his government.
On August 18, the Sultan made the most significant government reshuffle in 50 years, removing more than five governmental councils and merging more than 10 ministries. The changes came as part of efforts to address the nation’s looming challenges including high unemployment, fiscal deficit, and maintaining a foreign policy of neutrality amid regional conflicts.
The Sultan’s measures turned the page in other ways as well, reorganizing ministries, liquidating many state bodies, and appointing new heads for various government-owned institutions. He also relinquished some of his portfolios of foreign affairs and finance.
The economy has been a central focus for His Majesty Sultan Haitham, demonstrated in his governance of Oman and in the recent cabinet reshuffle. The Sultan also appointed some members of the elected Shura Council to the Cabinet, integrating them into his new government. This suggests sensitivity to public opinion as some of them have been very active in public seminars and on social media.
A 10 per cent cut across the board to the budgets of government ministries signaled the new Sultan’s intent to reduce spending and introduce greater fiscal discipline.
Development plans
In just under 50 years, Oman could turn into a modern economy with all of the associated infrastructure — highways, container ports, high-speed internet, dams, and water desalination plants — as well as a plethora of cultural, educational, and health care facilities. Today Omanis enjoy living standards, measured in terms of GDP per capita, at the level of many advanced economies.
The first government budget was announced in 1971, and the First Five-Year Development Plan was initiated in 1976. All the subsequent plans have emphasised on a shift from an oil dependent economy.
The focus has been on development to help upgrade people’s standard of living while generating more job opportunities.
In 1995, Oman 2020 has set out a clear and well-defined path towards the 21st century under which the economy would rely on private initiatives, a national workforce, and renewable resources in order to achieve sustainable development.
Shortly after the United Nations adopted the 2030 Agenda for Sustainable Development in September 2015, the Sultanate devised the 9th Five-Year Plan (2016-2020) which underscores Oman’s determination to keep pace with evolving international development instruments, particularly the 2030 Agenda for Sustainable Development.
Subsequently, a Royal Decree was issued for the preparation of Oman 2040 Vision, which was meant to discern the socio-economic reality and chart an objective forward-looking course that would serve as a fundamental guide and reference to the Sultanate in any planning exercise during the following two decades.
Vision 2040
In a move to accelerate the Oman Vision 2040 roadmap, of which His Majesty Sultan Haitham has been a key proponent over the past few years, there will also be oversight in the form of an Implementation Follow-up Unit.
Oman Vision 2040 is the Sultanate’s gateway to overcome challenges, keep pace with regional and global changes, generate and seize opportunities to foster economic competitiveness and social well-being, stimulate growth, and build confidence in all economic, social and developmental relations nationwide.
However, the main aim of the Oman Vision 2040 is the government’s strategy to diversify the economy away from a dependence on oil.
The diversification initiative by the government aimed mainly at linking the strategies of the main vital sectors of Manufacturing, Tourism, Transport & Logistics, Mining and Fisheries to each other in order to diversify the national income resources and fulfill the objectives of the Ninth Five Year Development Plan 2016 – 2020.
It also works towards a sustainable participation between the public and private sectors.
Diversification and free zones
The industrial sector has for long been the foundation of Oman’s long-term diversification strategy as it is also capable of meeting the country’s social development needs and generating more employment opportunities.
Oman Free Zones are suitable for foreign companies looking to use Oman as a regional base for manufacturing and distribution and the country has specifically targeted businesses in the import/export industry.
Development of industrial estates in Sohar, Sur, Salalah, Nizwa and Buraimi. The provision of natural gas to the industrial estates in Sohar and Salalah has helped promote the expansion of those industries reliant on large quantities of energy.
Tax exemptions are an incentive to the development and expansion of the industrial sector, which contributes significantly to the country’s GDP, currently at 16.3 percent (USD 12.9 billion).
The Duqm region is one of the newest industrial areas growing in prominence with a port and industrial zone project that will transform the area into a major economic development center in which the port will act as facilitator unlocking the potential growth opportunities.
The Duqm port & dry-dock will be one of the major ports in Oman with its strategic location. This port is also equipped with a ship repair yard and dry-dock facility, which is the first of its kind in Oman.
Strategically placed along the Arabian Sea coastline, Duqm Port and Free Zone is known as the import/export hub to the Middle East, North and East Africa and South Asia.
Sohar Port and Freee Zone is Located close to Port of Sohar and Sohar Industrial Estate, this Free Zone is aimed at attracting investment in the following sectors: metal, steel, food and logistics.
Salalah Port and free zone Opened in 2005, this Free Zone is still under construction. Once complete, it will span across 19 sq.km, the Free Zone is next to the Salalah port and airport.
Tourism growth
Oman is known as one of the very popular tourist attractions among Gulf nations, with a variety of geographic destinations. Tourism is a fast growing sector in Oman and it contributes to the economy in many ways such as generating employment, creating good opportunities for small scale local business and attracting foreign investment.
For tourism to contribute meaningfully to Oman’s economy, making up at least 10-15 percent of the GDP. Tourism is being developed as an important and sustainable socio-economic sector of the Sultanate of Oman in a manner that reflects the Sultanate’s history, cultural and natural heritage and spirit of traditional hospitality.
Tourism will facilitate economic diversification, the preservation of cultural integrity and the protection of the environment of the Sultanate.
Foreign investment law
Under the new Foreign Capital Investment Law, foreign investors can now set up investment companies in Oman without any capital requirements, and local participation is no longer mandatory. The Ministry of Commerce, Industry and Investment Promotion further facilitates the registration of companies subject to the new law by introducing an incentive package to ensure capital stability, allowing the transfer of profits abroad, and simplifying the licensing procedures.
The new law will play an important role in attracting foreign investments and the flow of capital within the Sultanate by creating appropriate conditions for investment so as to be competitive in attracting investments from countries around the world, and granting incentives, privileges, and guarantees that contribute to the establishment of foreign investments.
The development of Small and Medium Enterprises (SMEs) lays a solid foundation for self-reliant industry and modernization of the economy. Despite the various challenges within the region and in the country, Oman’s economy is set on the right path of sustainable growth, development, diversification and progress.
Human resources
Although the past five decades are not a long time in the lives of people, they have in fact witnessed a qualitative and quantitative progress, development and civilisation in all spheres of life.
The achievements that have been accomplished in all fields remain more eloquent than any statement and stronger than all words because they are a reality that are lived by the Omani citizen whether he is inside and outside the country.
Since the very beginning of the modern Omani Renaissance, the government has devoted significant attention to the development of human resources.
The government has exerted great efforts to train and upgrade the qualifications of Omani nationals to enable them to contribute to the development of society and humanity at large. As a result, education and training are prioratized and have been a cornerstone of each of the Sultanate’s five-year development plans.
The Ministry of Education’s commitment to a sector that – while maintaining traditional values – is modern and advanced, is reflected in its range of educational programs, including the basic education system, designed to meet the demands of modern science and culture in the information age.
COVID-19 pandemic
However, the new government under His Majesty Sultan Haitham had to contend with the dual impact of the arrival of the COVID-19 pandemic and the collapse of the world oil market. But the government responded by mobilizing all sectors in addition to establishing a Supreme Committee under the Royal Order to deal with the unprecedented situation.
Much of Oman was locked down in the initial period of the breakout of the pandemic. Businesses were allowed to open in phases and government work resumed from the beginning of June, even though not in full attendance. Restrictions on domestic and international were lifted partially with road and air freight allowed to operate from the beginning of October.
His Majety Sultan Haitham made a strong start in dealing with the economic challenges triggered by COVID-19. The people of Oman and the world are looking at the new ruler of Oman with high hopes and expectations. In the coming years, we can hear lot of good news from this part of the world.
