Before the money moves, the treaty must

Somewhere this week, in a boardroom in Seoul or Manchester or Riyadh, a company is deciding whether to build a factory at Suhar or a resort on the Dhofar coast. The spreadsheet is finished. The returns look fine. The last question before the vote is never about the returns. It is the quieter one: and if something goes wrong? The answer that wins the vote usually comes from a document the directors have never read, a treaty signed years earlier between their government and Oman's. It is the least glamorous paper in the file, and the most valuable.

A bilateral investment treaty is simpler than its name. Two governments promise to treat each other's investors fairly, not to seize their assets without paying full value, to let them send profits and capital home freely, and, if a serious dispute arises, to let them take it to neutral international arbitration rather than to the courts of the country they are quarrelling with. Think of it as a passport for capital, or as an insurance policy that costs the host country nothing but its word. Capital is cautious. It goes where it is sure it can leave, and only then does it decide to stay.

Oman understood this early. The Sultanate of Oman has signed forty such treaties since 1979, twenty-nine of them in force today, with partners from the United Kingdom and China to Switzerland, the Netherlands, Korea and Japan, and it has an investment chapter in its free trade agreement with the United States. It is a member of the ICSID and New York conventions, so an arbitration award can be enforced across borders, and since October 2025 a dedicated Court of Investment and Commerce has handled commercial disputes at home. Foreign investors may own their Omani companies outright in most sectors, with no minimum capital. The result is visible in the numbers. NCSI puts the stock of foreign direct investment at RO 32 billion in mid-2026, and roughly four-fifths of it comes from Britain and America, the two partners whose investors arrived under treaty protection decades ago and who stayed through a difficult year in the region. That is not a coincidence.

The protection runs in both directions, which is the part often missed. An Omani contractor whose road contracts abroad were frustrated took the host government to international arbitration under one of these treaties and won. The Sultanate of Oman's own sovereign fund has used a treaty to pursue a claim in Europe. And when foreign investors have brought claims against Oman, four since 2011, two were dismissed in full and one was settled, which tells future partners that the treaties are a fair referee, not a blank cheque. The research backs the instinct. A widely cited study in Review of World Economics found that developing countries with more investment treaties attract more foreign investment, and UNCTAD counts more than 2,600 such agreements in force worldwide. A country without them asks investors to take it on faith. A country with them asks only that they read.

This is where Vision 2040 enters. The Eleventh Five-Year Development Plan asks foreign direct investment to reach 10.5 per cent of GDP and the economy to create 300,000 jobs by 2030, with the growth coming from manufacturing, logistics, tourism, the digital economy and green energy rather than from oil. The new wave is already forming: a Korean developer's green ammonia plant, a Saudi real estate project, Kuwaiti capital in the Al Duqm refinery. Much of it comes from Asia, the Gulf and newer partners, and here the network, built mostly between 1987 and 2007, is thinner than it is for Europe, simply because it was built for the investors Oman had then. The direction of travel is encouraging. A treaty with Hungary entered into force in 2022, one with Iran was ratified in 2025, a text with the Philippines was concluded last month and a free trade agreement between the GCC and the United Kingdom was signed in May 2026. The task is to finish the map where tomorrow's capital originates.

Three steps would do most of the work. First, bring into force the eight treaties already signed but not yet ratified; that needs paperwork, not negotiation. Second, adopt a modern model treaty that protects investors while preserving Oman's right to regulate on tax, environment and Omanisation, so that protection and policy space grow together rather than ending up in arbitration. Third, treat the treaty map as a marketing asset: publish it on Invest Oman, carry it to every roadshow, and keep settling awards promptly, because reputation in this field compounds like interest. Omani companies going abroad, whether into Africa, Central Asia or the Gulf, should use the same treaties when they invest, and any investor looking at Oman should ask for the treaty before the tariff schedule.

A treaty is a handshake written into law. It does not pour the concrete or fill the hotel rooms, but it is the reason the builder comes. For more than forty years Oman has kept its word to the investors who trusted it, and that record, more than any incentive, is what a negotiator should carry into the room. The next decade's partners are waiting for the same promise. Offer it to them, and the money will do what money has always done: go where it is sure of its welcome, and surer still of its way home.