Oman’s development story is an exciting one. Oman has achieved significant development leaps at various levels, which are evident from different local and international indicators. However, there are a number of great challenges facing its development. We need to enhance business owner understanding of the wide-ranging impact of the pandemic and help them design suitable recovery policies and actions to build resilient and more inclusive and sustainable growth.
Oman is at a critical stage in terms of its development, and Oman Vision 2040 provides an opportunity for change that calls for a paradigm shift in all aspects of our country’s development including on the level of individual and society, government and business.
The rapid developments in the business environment and various other fields pose great challenges to governments and companies on both the local and global levels, while simultaneously providing them with great opportunities. In order to keep pace with these agile developments and seize opportunities, we must highlight the importance of changing the current frameworks and methods of work for companies in accordance with the best global practices, new data and Oman 2040 vision.
The private sector (business) in Oman is still at the receiving end. Relying heavily on outdated business strategies, high oil prices, government contracts, material imports and low-cost labour will no longer be sustainable or profitable.
In fact, local business must build on their strengths and previous accomplishments, moving their strategy toward international investment, local production, exported goods and services. It is the time to see big business houses acting as anchors for the new path of development. This is demonstrated by Korea’s experience with LG, Samsung and Hyundai.
For business, Vision 2040 provides an incentive for change that calls for a paradigm shift in all aspects of doing business. With Vision 2040, businesses step up to play a leading role in the Renewed Renaissance, and contribute to the company’s growth and Oman’s sustainable future through the successful implementation of this vision.
The vision calls for a change in key elements and factors that determine business future growth in Oman including the following: capital, which can be obtained from FDI and local private sources; human capital, labour and talent; productivity and efficiency; and best utilisation of good infrastructure.
It is clear that Oman invests wisely in upgrading its infrastructures such as roads, ports, airports, networks and other infrastructures needed for development. It is now an issue of effectively utilising all these investments for the purpose of sustainable development.
To build on the degree of readiness in infrastructure and availability of natural and human resources, it is essential for business in Oman to move towards a more integrated and international cooperation to attract sizable FDI and enhance trade in order to enable the country to move towards a new path of development based on investment, production and exports. A lot of our resources are not fully utilised and many segments can flourish toward a better performance.
The non-oil sectors have significant room for improvement too: Business needs to support government to scaling a lot of existing programmes and initiatives such as local content, SMEs funding and others.
Moreover, fixing Oman’s economic cycle is among top priorities in the vision that can be achieved through intensifying the use of different financial, monetary, social, trade and other forms of policies as different engines to work towards desired goals, state business and the society relationship.
Also, Oman’s business cycle requires attention: To fix the business cycle, businesses need to focus on enhancing, supporting, and strengthening production of goods and services, export-oriented policies and FDI, while targeting increasing backward and forwards linkages within the economy. Moreover, business must also focus on improving the labour market which is heavily reliant on low-skilled labour.
Among the alternatives proposed will be improvements with regards to attracting global talent and providing them with an incentive to work, stay and invest in Oman.
Human resources are key to the Vision’s success and it is essential to mobilising and energising Omani the individual and business to be inspired and entrepreneurial in order to unlock their true potential. The involvement of youth in business is essential and policies should be tweaked to ensure that they are integrated and taken into account in the decision-making process, and that all policies look to diversify and ensure job creation for local youth.
One of the key directions of Oman Vision 2040 looks at a development paradigm shift based on integration and international cooperation and attracting more investment.
Oman has abundant natural resources, as well as ambitious strategies to develop several sectors including: tourism, fisheries, logistics, mining, manufacturing and technology. However, the development of these sectors will not be possible without effective local and foreign investment. Due to high barriers of entry to non-resource sectors, such as high costs due to the lack of development as well as a lack of experience in such industries, the domestic private sector is unable to pursue opportunities in the market alone.
Moving forward and building on the degree of preparedness in infrastructure and the availability of natural and mining resources, it is essential for Oman to support local business and attract sizable FDI to enable the country to move in a new path of development based on investment, production and exports that will help the country in dealing with its two great challenges — Economic Diversification and Job Creation — in the post-pandemic era.
Today, Oman is at an important stage of development as globalisation and the Fourth Industrial Revolution revolutionises the globe and integrates its economies. Therefore, Oman Vision 2040 sets ambitious strategic targets that will require a high degree of determination by the local business and government to leap forward the development process.
We are confident that by capitalising on Oman’s competitive advantages — including its strategic location, rich heritage, unique natural beauty, cheap energy resources and the abundance of various raw material particularly in the mining sector — the Sultanate has all that it takes to achieve these targets. Oman Vision 2040 provides a catalyst for change that calls for a dramatic and paradigm shift in all aspects of development. We totally envision that individual, society and business will need to leave their comfort zones and be uncomfortable for a short to medium term, as it will be a period of adjustment and action-taking.
This is essential for long-term prosperity and sustainability. Business should align its priorities and goals with Vision 2040 priorities and goals through understanding the vision pillar aspiration.
[Dr Yousuf Hamed al Balushi is the Founder of Smart Investment Gateway; www.omaninvestgateway.com]