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The development of Oman’s ports and their importance to the country’s logistics sector

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The development of Oman's ports and their importance to the country's logistics sector

For the longest time, Oman was over-reliant on oil for the proliferation of its economy. However, depleting resources and skyrocketing prices led the government to look towards economic diversification. This enabled the growth of other sectors through dedicated and strategic efforts as the Sultanate started investing in industries that were, hitherto, not much in the focus. And the logistics industry is one of them. In fact, the logistics industry has emerged as one of the strong pillars of economic diversification efforts and it has shown immense potential in taking things forward.

One of the main steps that the Omani government has taken to intensify the growth of the logistics companies and shipping companies is development of its several ports, an effort that has yielded noticeable results. Their strategic geographical location and smart development plans have made them significant contributors of connecting global markets and bridging the gap between Asia, the Indian subcontinent, and East and Central Africa to the entire GCC region.

The three main ports of Oman – Sohar that lies midway between Dubai and Muscat in the north, Duqm, which is almost ready to be 100 % operational, and Salalah in the south that acts as a trans-shipment hub and connecting point to East Asia – have been quite intelligently developed by the government to ensure that these ports facilitate Oman’s bid to become a global logistics hub.

Oman Ports – Key Facilitators of the Logistics Sector

Oman’s three major ports – Salalah, Duqm and Sohar – have developed as super contributors towards Oman’s economy. Their location, strategic development by the government, geo-political circumstances, and world-class infrastructure make these ports enable them to become futuristic providers of what Oman is looking for to boost its economy.

The exponential contribution of these ports indicate what an important role they play in establishing Oman as the global logistics hub. The Sohar Port’s throughput (export and import) increased by 32% in 2022 with the dry bulk volume growing by 38% and liquid bulk volume by 28%. There was a rise of 4% in the number of containers along with a 60% rise in the ship-to-ship cargo. Additionally, several mega projects at Sohar promise increasing FDI, an area that the Oman government is clearly looking at. Similarly, the Salalah Port handled 4.51 million TEU, a 3.8% rise from 2020 and another 1.5 million TEU were added in 2022, making Salalah Port a major contributor towards Oman’s logistics sector. The Duqm port too has shown immense potential by increasing its capacity to handle ship loads and expediting trade.

The government’s strategic planning and smart investments have ensured that not only the main ports like Sohar and Salalah are developed properly, even the smaller and the lesser significant ones are also developed to provide enough support. What is also interesting to note is that the government has, simultaneously, started investing in industries that will further enable the growth of trade in Oman, giving rising opportunities for the ports to do well. Industries like fisheries, metal, green energy, tourism, mining, agriculture, manufacturing and logistics have been given a proper push to increase cross-border and international business.

Multiple initiatives, MoUs and Foreign Tie-Ups Take Ports to Another Level

When it comes to developing the ports in Oman, the way the government has worked has exhibited clear focus on their goals. Be it signing multiple MoUs with neighboring countries, inviting FDI by providing a business-friendly environment, giving a push to support infrastructure and expanding rail, road and air transport, the Sultanate has ensured it provides a conducive atmosphere for the ports to flourish.

In turn, the ports in Oman have responded in the best possible manner. The operational capabilities, load-handling prowess, handling mega shipments and expanding trade globally have ensured that Oman reinforces itself as the hub of global logistics. The logistics companies in Oman and shipping companies in Oman have taken this opportunity with both hands and made a huge impact in the overall scheme of things.

To further facilitate the role of ports, Oman has developed Logistics Strategy 2040 under which, the Sultanate plans to divert targeted growth strategies and long-term plans to further how the ports partake in the country’s economic diversification goal. The Oman ports, due to their strategic geographical location, are key elements to whatever Oman plans to achieve in the coming future. Global markets and the international logistics industry have come to rely on the ports of Oman as they are important connecting dots between big markets in the area.

Oman’s ports will continue to be significant in the economic growth of Oman and to establish the country as a logistics hub that the world can’t do without. The way things are shaping out clearly shows that Oman ports are the emerging force to reckon with, and will play a crucial role in the way Oman shapes its future.

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