Oman as an investment destination6 Although the oil sector has underpinned expansion of Oman’s economy over the past decades and accounted for almost two-thirds of total goods exports and one-third of GDP in the recent years, in early 2016, Oman introduced its National Program for Enhancing Economic Diversification – also known as Tanfeedh – to shift its economy away from oil towards a sustainable, innovation, and knowledge-based economy. Tanfeedh was a government initiative 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. The Oman Government considers diversification as one of the main objectives for the achievement of the vision for Oman’s economy. To achieve this objective, the government is making all-out efforts to provide appropriate conditions. The diversification strategy focuses on three core areas: 1. Attracting foreign capital and expertise into non-oil, export-oriented sectors through a combination of regulatory reforms and infrastructure investments. 2. Capitalising on Oman’s geographic advantage to develop into a regional logistics hub. In addition to boosting the domestic ports and logistics industry, the government hopes this will create positive spillovers to other domestic industries. 3. Enforcing local employment and procurement requirements on foreign firms. In so doing, the government hopes that rising profits in exportoriented sectors will permeate across domestic-focused industries such as retail and real estate. Investment plays a major role in all developing economies as it drives its dynamic basics of growth, development, and structural changes. Despite the prevailing economic, political and social circumstances at the time of the Omani Renaissance in 1970, the intensive programmes on investment during the past five decades have been able to transfer the oil revenues to a developed economic and social infrastructure, essential for leading sustainable development. The First Development Plan of Oman stated: “Working on finding a new national income that supports oil revenues and supersedes it in the future, the Sultanate deems it essential that it develops its 6
Information for this section has been taken from personal interviews with the stakeholders who have been referenced within the text. 186
