Priority industries drive Oman’s transformation

Manufacturing represents one of the key pillars of economic diversification in the Sultanate of Oman, contributing to value addition, expanding the production base, creating new economic opportunities, and strengthening the competitiveness of the national economy. In this context, Oman’s Manufacturing Strategy 2040 seeks to drive a structural transformation of the manufacturing sector by encouraging the development of new and more technologically advanced industries, while at the same time improving the productivity, quality, and efficiency of existing factories.
At the heart of this transformation are 30 priority industries and activities identified at the four-digit level of the International Standard Industrial Classification (ISIC). These industries are intended to act as strategic drivers for the wider manufacturing sector and to support the long-term vision of developing a more diversified, competitive, and value-added industrial base. Based on the nature of their main inputs, the priority industries can broadly be grouped into three categories: knowledge-driven industries, capital-intensive industries, and natural resource-based industries.
Knowledge-driven industries represent an important pathway towards developing a more technology-intensive and innovation-oriented industrial base. These industries focus particularly on health and human care, as well as environment and sustainability. They include pharmaceuticals products, medical and health equipment’s, perfumes and cosmetics, renewable energy equipment’s such as solar panels and wind turbines, green hydrogen, and recycling activities covering metals, steel, aluminium, glass, plastics, and construction materials. These industries are characterised by greater reliance on research and development, specialised skills, advanced technologies, and strong quality-control systems. Their development can therefore contribute not only to industrial output, but also to innovation, resource efficiency, technology transfer, and the creation of new high-value economic activities.
The second category comprises capital-intensive industries, particularly those associated with electromechanical and transport equipment. These include structural metal products, shipbuilding and ship repair, electric motors and electrical equipment, insulated wires and cables, air-conditioning equipment, pumps, and valves. These activities are important for strengthening Oman’s industrial and engineering capabilities and can create stronger linkages with major projects in energy, infrastructure, construction, logistics, and other sectors. Their increasing adoption of Fourth Industrial Revolution technologies also highlights the growing need for advanced technical, engineering, and digital skills.
The third category comprises natural resource-based industries, whose principal inputs are derived from agriculture, petrochemicals, metals such as aluminium and steel, minerals, and other natural resources. These industries are organised around three main areas: food, oil and gas, and metals and minerals, while furniture is treated as a separate activity.
This category reflects Oman’s abundant natural resource base and its significant contribution to industrial development. However, the greater opportunity lies in moving beyond the production of basic and lower-value products towards more sophisticated downstream manufacturing. Such a shift can increase domestic value added, diversify the industrial base, strengthen linkages across local supply chains, and enhance Oman’s integration into regional and global value chains.
This approach reflects an important direction for Oman’s industrial development: combining the country’s natural resource advantages with technology, knowledge, innovation, and industrial skills. Natural resources provide a strong foundation, but long-term competitiveness will increasingly depend on the ability to transform these resources into higher-value products and to develop the capabilities required to compete in increasingly sophisticated markets.
At the same time, industrial transformation should not focus solely on establishing new factories. Existing manufacturing capacity represents an important national asset and requires continued investment in productivity, product quality, energy efficiency, modern technologies, and international standards. Improving the performance of operating factories can help increase competitiveness, reduce production costs, strengthen local supply chains, and expand the ability of Omani companies to serve both domestic and international markets.
Technology and human capital will also be central to this transformation. The expansion of knowledge-driven and capital-intensive industries requires specialised engineers, technicians, researchers, digital specialists, and other skilled professionals. As manufacturing becomes increasingly automated and connected, education, technical and vocational training, and skills development must evolve in line with the changing needs of industry.
Ultimately, the 30 priority industries provide a strategic framework for directing investment and industrial development towards activities capable of generating greater economic impact. They bring together Oman’s natural resource strengths with opportunities in advanced manufacturing, electromechanical industries, transport equipment, health, environmental activities, and other knowledge-intensive fields.
The next phase of Oman’s manufacturing development should therefore focus not only on producing more, but on producing more efficiently, more technologically, and with greater value added. By strengthening existing industrial capabilities while creating opportunities for new industries, developing local supply chains, investing in skills and innovation, and accelerating the adoption of advanced technologies, Oman can further position manufacturing as a powerful engine of economic diversification and a key contributor to the objectives of Oman Vision 2040.