Thursday 25 / April / 2024
Muscat: Oman's export sector posted robust growth in 2017, with the value of exports during last year having increased to OMR12.6 billion, compared to OMR10.3 billion in 2016; a growth of 22.7 per cent.
The sector, which is one of the key drivers of economic diversification, can create new job opportunities, attract foreign investments, provide a healthy environment for the growth of local investments and curb the deficit of the balance of payments.
The value of oil and gas exports stood at OMR7.3 billion, or 58.1 per cent of the total value of commodity exports in 2017, supported by the increase in the price of Omani crude oil, whose average stood at $51.3 per barrel, compared to $40.1 per barrel in 2016.
Non-oil exports increased by 32.4 per cent to reach OMR3.1 billion, compared to OMR2.4 billion in 2016; the highest rate of growth during the past three years. Also, the value of the re-export of products reached OMR2.1 billion, an increase of OMR52.7 million over 2016.
The major non-oil Omani exports include products from the chemical industries, metal and plastic products, tools, electrical appliances, transport equipment and others.
The industrial sector is one of the key areas assisting the growth of the national economy. The current five-year plan focuses on increasing the growth of the industrial sector, especially the manufacturing industries, the major source of export products. As per the statistics of the National Centre for Statistics and Information (NCSI), the gross domestice product (GDP) of the manufacturing industries grew by 8.7 per cent in 2017 to OMR2.8 billion, compared to OMR2.4 billion, to constitute 48.4 per cent of the GDP for industrial activities, whose value stood at OMR5.5 billion.
A number of industrial projects are underway, and are expected to increase the volume of Omani non-oil exports. Some OMR11.2 billion in projects are being carried out, including the Duqm Refinery and the crude oil storage terminal at Raz Markaz, the Chinese Industrial City, Sebacic Refinery, the bus and auto assembly factory, two cement plants, fish processing plants, along with other projects.
At the Sohar Port Industrial Zone, Orpic, last year, completed the Sohar Refinery Improvement Project (SRIP), which aimed at maintaining the nation’s public health and environment by reducing emissions and recycling industrial waste-water at the Sohar Refinery.
The project will also improve the efficiency of the refinery operations, and increase the production of naphtha, which is used as feedstock for aromatic plant. It will further reduce naphtha imports, from 70 per cent to 30 per cent. It will also increase the production of polypropylene, which will be used to supply the needs of the polypropylene plant, instead of importing. Additionally, the project will produce tar for the first time in the Sultanate.
A land usufruct agreement was signed last year with a leading Indian manufacturing company, which will invest $300 million to set up a plant that will produce cotton thread, to be exported to textile plants abroad.
Of note, the value of investments at the industrial estates managed by the Public Establishment for Industrial Estates (PEIE) increased to about OMR6.3 billion.
The growth registered in the export sector comes at a time when the Sultanate has witnessed the implementation of a number of projects that support the growth of this sector and contribute to achieving economic diversification.
The opening of the new Muscat International Airport, Al Batinah Expressway and work on a number of projects in Duqm, Salalah and Sohar Ports, will provide momentum to the export-based industries.
The experiences of many countries around the world point out that the growth of the export sector contributed to creating new job opportunities and helped in reducing the number of jobseekers.
The growth of the export sector also contributed, as well, to reducing the deficit of the balance of payments, as export is one of the key sources for attracting foreign currency. The growth of exports also creates a local and foreign investment-friendly environment, which helps in developing modern technology, foreign capital and competitiveness of local products. The investments are also key drivers for the growth of the export sector and increasing its contribution to diversifying the economy.
