Protracted dwell times of import and export cargo at Omani seaports and airports — long the bane of an industry aspiring to grow into a leading logistics-centric economy — have been dramatically reduced thanks to the implementation of a number of “transformative projects”, according to the Oman Logistics Centre (OLC).
OLC, a task force operating under the auspices of Asyad Group — the state-owned transportation and logistics flagship — has been mandated to drive the implementation of the Sultanate of Oman Logistics Strategy 2040 (SOLS 2040).
These “transformative projects, initiated in collaboration with various regulatory and stakeholder agencies, most notably the Royal Oman Police Customs, have helped eschew bureaucracy, paper-based documentation and all sorts of cumbersome formalities impeding the smooth flow of cargo in and out of the Sultanate’s borders, according to OLC.
“Traders in Oman now have a choice of expediting the movement of their import shipments by Customs clearing them before arrival of the carrier,” said the Centre in its newly released 2018 Annual Report. “This outcome is result of a joint effort by Customs, OLC and 10 pilot importers and their logistics service providers. We came together and worked out a solution that saves time and cost for all the stakeholders. The share of pre-cleared shipments reached 14 per cent. Partly as consequence, the average time of sea cargo staying at ports reduced from 8 days to 5 days in 2018.”
Furthermore, seeking to incentivise investment in Oman’s free zones, ROP Customs has made it possible for investors to move cargo to and from free zones without the need for furnishing a bond against each transaction.
Henceforth, cargo movement is possible against the submission of a long-term written guarantee renewable bi-annually. Additionally, inspections are exempted provided the company operates a reporting system that confirms the entry of the goods into the free zone.
“These opportunities are automatically available for Authorized Economic Operators (AEOs) and for compliant traders through a separate application.
This relaxation of the bond requirement is expected to significantly increase the attractiveness of Omani free zones and contribute to their future success,” the Centre noted.
As a result of these initiatives, the logistics sector grew by 8 per cent in 2018, more than double the growth rate of the economy as a whole, said Al Khattab al Maani, Executive Director, Oman Logistics Centre. Moreover, the sector accounted for 3.75 per cent of the Gross Domestic Product (GDP), with as many as 3,500 jobs created for Omanis in 2018 alone, he stated.
In other significant improvements achieved by the sector, cargo inspections by Customs were reduced from 80 per cent to 12 per cent, and by other government regulatory agencies from 100 per cent to 12 per cent — measures that have helped speed up the flow of goods. Consequently, import clearance times dropped from 49 hours to 6 hours at sea ports and 4 hours at airports.
As a result of these far-reaching initiatives, Oman boosted its position in the World Bank Logistics Performance Index (LPI) by five positions from 48 to 43, according to OLC. Improvements were recorded two key LPI indicators: Customs, and Timeliness of Shipments, it added.