Oman’s industrial sector enters new growth phase

Muscat: The industrial sector in the Sultanate of Oman is undergoing a qualitative transformation, shifting from quantitative expansion in facilities and production to the development of an industrial base more closely integrated with modern technologies, local supply chains, value addition and the upskilling of national competencies, in line with the targets of the Industrial Strategy 2040.
According to statistics issued by the National Centre for Statistics and Information, the value of the manufacturing sector's contribution to the Sultanate of Oman's gross domestic product at constant prices reached approximately RO 3.7 billion by the end of 2025. Meanwhile, during the first quarter of the current year (2026), it amounted to RO 869 million.
The Industrial Strategy 2040 targets raising the manufacturing sector's contribution to RO 5.44 billion by 2030, ultimately reaching RO 10.702 billion by 2040.
Non-oil merchandise exports recorded a growth of 1.5 percent by the end of May 2026 compared to the same period in 2025, reaching RO 2.739 billion. The Industrial Strategy 2040 targets raising this value to over RO 10 billion by 2030, encompassing exports of metal products, chemicals, energy-related industries and food products. Re-exports also rose significantly by 64.4 percent by the end of May 2026, exceeding RO 1 billion.
Anwar bin Hilal Al Jabri, Minister of Commerce, Industry and Investment Promotion, stated that these indicators reflect the success of national policies and initiatives that have contributed to strengthening the Omani industrial sector's capacity to transition from expansion in the scale of facilities and production to building a more integrated industrial ecosystem.
In an interview with Oman News Agency (ONA), the minister emphasized that the rising accumulated stock of foreign direct investment in the industrial sector confirms the Sultanate of Oman’s attractiveness as an industrial investment destination and reflects growing confidence in its strategic location, advanced infrastructure, integrated economic and industrial zones, investment incentives, and access to regional and international markets.
He further noted that the Ministry is working in the upcoming phase to strengthen partnership with the private sector and investors to accelerate the localization of priority industries, increase local content and support small and medium enterprises linked to the industrial sector, thereby contributing to the creation of quality employment opportunities for citizens, enhancing the competitiveness of Omani products and raising the value added to the national economy.
He added: 'Our ambition is not limited to expanding the size of the industrial sector, but rather extends to building a sustainable, smart and competitive industrial sector capable of innovation, export and integration with other economic sectors, thereby strengthening the Sultanate of Oman's position as an industrial, logistics and investment hub in the region, and supporting the objectives of economic diversification and sustainable development.'
For his part, Eng. Ghalib bin Said Al Maamari, Undersecretary of the Ministry of Commerce, Industry and Investment Promotion for Commerce and Industry, noted that industrial activity growth has encompassed the expansion of the production base, increased output value, and the attraction of workforce, alongside efforts to deepen local manufacturing and enhance value addition.
He indicated that the number of workers in the industrial sector reached approximately 240,226 by the end of 2025, with the Industrial Strategy 2040 targeting an increase to around 273,000 workers by 2030, particularly in non-metallic mineral products, food industries, and machinery and equipment manufacturing.
He explained that the indicators adopted by the Industrial Strategy 2040 target local private sector investment at approximately 54 percent and foreign investment at 34 percent.
He added that the impact of industrial projects extends to activities related to the production process, including packaging, transportation, storage, laboratories, maintenance, spare parts, safety services, software, automation, as well as engineering services, refrigeration, structural fabrication, cables, electrical components, and operations and maintenance services.
Eng. Ghalib noted that the industrial strategy has selected 30 promising industrial activities from among 119, distributed across clusters including food industries, petrochemicals, health industries, metals and metallurgy, electromechanical industries, environmental industries, and renewable energy, aiming to connect producers, suppliers, and service providers within interconnected industrial ecosystems.
He further stated that the number of Omani products registered on the 'Made in Oman' platform reached approximately 7,307 products during the period from 2024 to June 2026.
Meanwhile, Eng. Khalid bin Salim Al Qasabi, Director General of Industry at the Ministry of Commerce, Industry and Investment Promotion, stated that modern technologies are enhancing industrial process efficiency through automation, production line integration, data analytics, artificial intelligence, predictive maintenance, inventory management, and supply chain optimization.
He noted that the Smart Production Factories Programme commenced in 2024 with the assessment of 20 Omani factories based on the Smart Industry Readiness Index (SIRI), before expanding to target 60 factories, with 45 factories assessed by the end of June 2026, representing 75 percent of the target.
He added that the index measures levels of automation, connectivity, intelligence, workforce readiness, governance, supply chain management, and product lifecycle. The programme aims to establish a team of Omani assessors and create Omani companies specialized in factory readiness assessment.
Regarding the 'Kafa'a' Lean Manufacturing Programme, he indicated that the first phase targets nine factories and the training of 13 Omani practitioners, alongside the implementation of process improvement projects within factories over a period of three to six months.
He explained that the projected financial savings under the programme are estimated at approximately RO 360,000 annually per participating factory, achieved through improved production capacity, reduced waste, and lower operational costs. Sustainable manufacturing practices include reduced electricity and raw material consumption, minimization of defective products, scrap, emissions, and process re-engineering.
He noted that the expansion of production technologies is linked to increased demand for competencies in operations, maintenance, quality, safety, supply chains, industrial technologies, as well as automation, data analytics, advanced maintenance, industrial cybersecurity, and energy management.
He affirmed that the Smart Production Factories initiative has included the qualification of Omani assessors to measure the digital maturity of factories, while the 'Kafa'a' programme focuses on developing in-plant practitioners and transferring knowledge to workers, alongside the implementation of the professional accreditation system encompassing both licensing and professional classification.
He pointed out that the professional accreditation system includes verification of workers' qualifications, experience, and competencies, granting licenses and professional certificates to those who meet the criteria, while professional classification helps determine the actual occupation and professional level of the worker, providing data on labour market needs and the supply and demand for skills.
He explained that this data supports workforce needs planning and guides education, training, employment, and Omanization programmes, while enhancing worker skills and qualifying Omani competencies for technical, specialized, supervisory, and leadership positions.
He added that incentives provided to industrial establishments and projects, in accordance with the provisions of the Industry Organization and Promotion Law, the Income Tax Law, and applicable executive regulations, include customs duty exemptions on imported machinery, equipment, spare parts, raw and primary materials, and packaging materials, as well as income tax exemptions for a specified period in accordance with the relevant controls and conditions.
He clarified that the procedures related to these incentives are implemented by the Ministry of Commerce, Industry and Investment Promotion and the Tax Authority, in coordination with the General Administration of Customs, and include the reduction of operational and capital costs associated with industrial projects.
Regarding impact measurement indicators, Eng. Khalid mentioned that the draft long-term impact measurement indicators for the industrial sector include the ratio of local value added to total output, the ratio and value of purchases from local suppliers, the number of Omani suppliers, the import substitution rate for intermediate materials, spare parts, and components, industrial export growth, and the level of value added therein, among others.
He indicated that the upcoming phase requires expanding industrial performance measurement from indicators related to sector size to measuring the level of integration of industrial activity with the national economy through value added, local purchases, jobs, and competencies linked to the production process. -ONA