The past five decades in Oman’s history have been all about stupendous success. From an underdeveloped country in the ’60s to becoming one of the promising contenders in global trade and active development, Oman has come a long way in a very short period of time. It is now home to some of the fastest developing industries – logistics, tourism, manufacturing, mining. The country’s urban development and the standard of living have seen a prominent surge. This has all been possible because of the oil and gas reserve that Oman started making use of under the rule of His Majesty Sultan Qaboos bin Said Al Said.
One of the biggest challenges that Oman faces is that, unlike its other GCC neighbours, it has limited oil and gas reserves. While its neighbours like Saudi Arabia and Abu Dhabi boasts of a huge oil and gases reserves, it has been estimated that Oman has reserves only for 15-18.5 years. And that is a very short time as compared to the kind of developmental dreams the country has seen. But the good news has been that the government realized this very early in their development cycle, which compelled them to look at diversifying their economy, a decision that is possibly going to change the face of the country forever.
To reduce its over-dependence on oil and natural gas, the Oman Government has taken several steps in the last few decades to diversify its economy and develop other sectors to boost its economy. This has happened in two major ways – Firstly, through investment diversification where the government has reduced the role of state and increased the role of private companies in bringing about economic changes and secondly, sectoral diversification where industries like logistics, tourism, mining, etc have been pushed to take a leading role surpassing oil and gas as the key productive sectors.
Setting up three Free Zones in Oman are a major step forward
Amongst many other initiatives for the diversification of the economy, the Oman government took yet another major step towards achieving its goal. It set up three Free Zones – Muscat International Airport Free Zone, Sohar Airport Free Zone, and Salalah Airport Free Zone in Oman this is being looked at as a major contribution towards the step forward.
Inviting foreign investments has been one of the key factors in fulfilling the dream of economic diversification and the government has been working incessantly to create a business atmosphere that makes foreign direct investment easy and attractive for international giants. And most industry experts feel that setting up these three Free Zones will do just that. The three zones are being seen as a melting point for businesses coming together, sharing their knowledge base, increasing business competitiveness, adding a skill set to the workforce, and propelling the diversification of the economy. Standing up to the global competition, attracting more foreign investment, and creating more jobs is something that is imperative for faster economic diversification, and these Free Zones are capable of doing that.
The Special Free Zone at Duqm Port is a prime example of how its development has attracted foreign investment and created more jobs. The development of the Duqm Port in itself has been an eye-opener for the government that has contributed immensely towards development and business growth. The opening of these three zones is also being seen as a major contributor towards the Sultanate’s tenth Five Year Plan (2021-2025) in many ways including giving a boost to the private sector, achieving economic diversification, and financial sustainability.