Saturday 20 / April / 2024
Muscat: Employees are increasingly settling labour disputes with employers out of court according to the just published 2019 Annual Report of the Implementation Support and Follow-up Unit (ISFU).
The percentage of disputes that were resolved amicably in the Ministry of Manpower rose from 48 per cent in 2018 to 60 per cent in 2019, reducing the number of labour cases referred to court.
Giving the background of this change, the report pointed out that the Labour Market and Employment Sector is considered as an enabling sector for other economic sectors. In 2019, 11 sector-specific initiatives were launched. One of the initiatives was Enhancement of Labour Disputes System. The initiative saw preparation and implementation of training programmes with three batches of legal researchers from the Ministry of Manpower.
A memorandum of cooperation was also signed between the Ministry of Manpower and the Ministry of Justice, to expand the scope of the Arbitration and Reconciliation Committees to include labour disputes.It also provided for giving the reconciliation reports executive and mandatory implementation form leading to the surge in out of court settlements.
The new ISFU Annual Report, the third one so far, also details all other projects and initiatives the Unit is following up and supporting, in cooperation with the relevant parties including government entities, private sector, and initiative owners.
Manufacturing is considered one of the key sectors contributing to the Gross Domestic Product (GDP). 2019 KPI Dashboard of Manufacturing includes 23 projects, some of which have been successfully completed during 2019, like Sebacic Acid Production Plant, Polymer Manufacturing Project, and Mazoon Dairy Project.
Also, Liwa Plastics Industries Complex, developed by OQ Group, has made a good progress and is expected to finalise construction and operation work during 2020, moving from initial production phase to full production phase.
Moreover, Duqm Refinery is a promising project for the sector. It is a Joint Venture (JV) between OQ Group and Kuwait Petroleum International. Once operational, the refinery will have the capacity to process 230,000 barrels of crude oil per day – which can further be processed on-site into diesel, jet fuel, naphtha, LPG, sulphur and petcoke.
Duqm Refinery is set to provide a significant boost to the Special Economic Zone Authority at Duqm (SEZAD), as it provides development opportunities for new projects that will interface directly and indirectly with the refinery. These projects will be able to establish commercial links with the refinery while having products within easy reach for their own operational use.
Furthermore, Al Bashayer Meat project is one of the Manufacturing projects related to food security. It was formed in 2016 as one of the major projects under the umbrella of Oman Investment and Finance Company. The company aims to provide premium meat to local and international markets through an extensive distribution network. Aligning with Oman’s food security vision and sustainability commitments, additional revenue streams will be generated from left-over edible/inedible parts.
Logistics included 21 initiatives and projects in 2019. One of its biggest projects is Khazaen Economic City, which is set to become a key regional hub for warehousing, logistics, light industry and commercial activities related to logistics. Looking at the achievements of Khazaen Economic City project in 2019, various key developments have been implemented. The masterplan of the city has been finalised, and the initial construction contract for 10 kilometres of internal road, water lines, and flood protection has been successfully awarded to Galfar, and construction has started. Furthermore, KEC LLC has completed a full business case study for the Fruit and Vegetable Market while initiating talks with a number of potential investors and operators, with the objective to sign with an investor. The company has managed to sign six agreements with tenants to develop an area of 500,000 square metres of logistics and industrial land.
In addition, Enhancing Rusail-Bidbid Road Network initiative, aiming to improve a 35 kilometre section of the Rusail-Bidbid highway, saw significant progress in 2019 as it connects Rusail and Sumail industrial estates, A’Dakhiliyah Road, and A’Sharqiyah Expressway. A third and fourth lane will be added to reduce traffic congestion and increase road-safety on this vital road. The Tender Board has completed the evaluation process of the Rusail-Bidbid road tendering and selected the best offer. Afterwards, the Supreme Council for Planning (SCP) has approved the project to be included as an economic project for the year 2020; and budget allocation was approved.
Regarding the Development of Khasab and Shinas Ports for Commercial Activities initiative, the masterplan for Khasab Port was completed during 2019. The tender for design and construction of the new cruise berth at the port was floated on July and awarded on December. Also, MARAFI has awarded contracts for the refurbishment of the port’s administration and passenger buildings. For Shinas Port, the development operations and further commercial plans were implemented after MARAFI received the operating license from the Ministry of Transport (MoT). Also during 2019, Shinas Port went ahead with the re-organising of its existing operations to meet the necessary standard maritime rules and regulations. The segregation between the commercial zone of the port and the fishing area was also carried out. The Implementation Support and Follow-up Unit (ISFU) has made many efforts to support the transformation of the two ports into commercial entities. During 2020, all remaining tenders for both ports will be awarded and the construction will start.
The Sultanate of Oman is endowed with rich natural, heritage and cultural resources that make tourism an important contributor to the national economy. In 2019, Tourism KPI Dashboard included 14 initiatives.
With the vision to develop domestic tourism and increase its contribution to the national economy’s GDP, Expediting Growth of Domestic Tourism initiative was added to the dashboard. It aims to provide the services, activities and projects which fulfil the needs of tourists and enhance their experience in Oman. The initiative included 4 KPIs in 2019: Creating domestic services for tourism, Developing and Executing New Tourism Projects, Creating a Framework for Domestic Tourism Development, and Planning, Developing and Operating the Public Services at Key Tourism Destinations and Express Stops.
The objective of creating domestic services for tourism is to provide new services and develop the existing ones in a number of locations chosen based on their importance and how frequent they are visited by tourists. In 2019, the initiative working group presented a proposal on developing Recreational Vehicle (RV) Parks and 3 locations were selected as an initial phase, in coordination with Omran. The locations are Atana Stay Al Ashkharah, Atana Stay Salalah, and Ras Al Jinz Turtle Reserve. In 2020, due to the situation caused by coronavirus (Covid-19) pandemic, there was a delay in the procurement of RV facilities from outside the Sultanate. The matter is being discussed and other suppliers are being contacted.
Moreover, in 2020, the working group selected a number of beaches in Muscat Governorate to be developed as an initial phase, in cooperation with Muscat Municipality. In addition, they addressed the challenges facing the development and improvement of beach services like food carts, modern restaurants, entertainment activities, such as sports activities for all segments of society.
Also, the team have successfully organised some beach events during 2019, including Sur Al Hadid Carnival at A'Seeb Beach. The event promoted entertainment and family activities, and provided services and facilities for domestic tourists, in partnership with SMEs.
Regarding the KPI: Planning, Developing and Operating the Public Services at Key Tourism Destinations and Express Stops, key destinations were identified by the Ministry of Tourism, in coordination with Omran, the Ministry of Regional Municipalities and Water Resources, and Muscat Municipality, to be developed as tourist destinations. Initially, 3 locations were selected: Wadi Shab, Wadi Tanuf, and another location in Al Buraimi Governorate. In addition, the team is currently improving the existing services in other tourism destinations.
During the year 2019, ISFU made a proposal for an initiative that activates the role of ministries overseeing economic sectors in achieving employment targets, through the formation of technical teams for the sectors of the National Programme for Enhancing Economic Diversification, under the supervision of the ministries overseeing economic sectors, supported by ISFU, the Ministry of Manpower and the National Center for Employment. Through these teams, the participation of the ministries will be activated in employment plans and the employment process in private corporates under its supervision. The actual operation of the technical teams formed for the manufacturing, logistics and tourism sectors began, followed by the formation of the fisheries, mining, energy and information and communication technology teams. In 2020, the initiative aims to develop precise work mechanisms, define terms of reference within the technical team, involve more entities in the employment efforts of the team, such as Oman Chamber of Commerce and Industry (OCCI).
Business Environment Sector is one of the most enabling sectors for the national economy, as many of its initiatives, which will contribute to facilitating doing business during the coming phase, have been accomplished. During 2019, a number of projects and initiatives were successfully finalized, including Foreign Capital Investment Law, Escrow Account Executive Regulation, Executive Regulation of Mergers and Acquisitions, Oman Credit and Financial Information Centre (Mala'a), “Invest in Oman” Portal, Bankruptcy Law, Enhancing Construction Permits in Muscat, and Real Estate Investment Trusts (REITs).
In addition to the main dashboard of the business environment sector, separate dashboards have been developed for both “Invest Easy” and “Lean” projects. “Invest Easy” project includes three main initiatives and 20 KPIs, which include the integration of government agencies with the system, the improvements that will be introduced to the system, and the indicators of the system's efficiency. As for “Lean” project, it aims to streamline the procedures for starting a business “commercial activity” in the Sultanate, and improve the KPIs for the selected operations, which are related to ease of doing business indicators, as the project includes 11 main initiatives with 29 KPIs. Lean methodology works on improving 3 main areas: quality, cost and production. Six projects were selected to be implemented with 5 different entities, and all stages of Lean methodology (definition, selection, removal, and sustainability) in the projects of several government agencies were achieved.
In 2019, the team, in cooperation with the Public Authority for Investment Promotion and Export Development (Ithraa), launched the “Invest in Oman” Portal. The portal is an electronic platform that represents a destination for investors looking to invest in the Sultanate, in which the available investment opportunities and projects in various sectors are presented. Several goals were achieved, including consolidating efforts of promoting investment opportunities between government and private sector institutions, and linking the portal with the relevant e-government projects, including “Invest Easy” platform.
The Sultanate enjoys several inherent advantages that make the Fisheries sector a promising sector for the national economy. Based on the set plans for 2019, Fisheries sector has scored many achievements as the Ministry of Agriculture and Fisheries (MoAF) and Al Raffd have successfully signed a memo for Al Raffd to fund 20 modern boats per year. Moreover, a consultant was assigned for Dithab port’s designs, and the tendering process for Mahout and A’Shuwemiya is at the final stages. Also, Al Wusta Fisheries Industries Company played a vital role in contributing towards increasing the amount of commercial fishing landing.
Moreover, the Artisanal Fishing initiative supports and encourages artisanal fishermen to make use of modern boats and coastal fishing vessels to improve the efficiency of their fish harvesting activities. In 2020, ISFU will be supporting and following up on MoAF’s target of providing licenses to a total of 70 coastal vessels and 40 modern boats.
Regarding Modern Boats, the aim of this project is to replace the fiberglass skiffs with new modern boats, the designs of which offer opportunities for longer overnight trips, enhanced catch quality and quantity, and reduced operating costs. MoAF, with ISFU’s support, is cooperating with Al Raffd Fund to finance the project, where applications are evaluated and qualified by MoAF, and subsequently financed. In 2019, as many as 48 applications for modern boats were approved, and licenses were issued.
The energy sector has been consistently developing, resulting in the achievement of several accomplishments during the year of 2019. This includes major energy projects, such as Dhofar Wind project, which has been commercially operated. Additionally, appliance standards for air conditioners have been completed and issued, contributing to enhancing energy efficiency. Moreover, the National Environmental Policy for Energy Sector (NEPES) project was completed, which will facilitate the environmental aspects related to the sector.
Amin Solar project, owned by Petroleum Development Oman (PDO), is the first large-scale solar project in the Sultanate of Oman. It will be playing a key role in alleviating the dependency on gas to generate electricity in Oman, and also reduce CO2 emissions by around 226,328 tonnes annually. In 2019, PDO signed the contract agreement with the developer to purchase the generated power under Power Purchase Agreement (PPA). Engineering, procurement and design work was finalised, in addition to starting the mechanical, electrical and civil construction. In May 2020, the project was commercially operated.
Also, Wind 2023 is one of the biggest wind energy projects in Oman. Since wind energy has huge potential as an energy provider for the country, the decision was taken to establish 100 MW to 200 MW capacity wind farm projects in 7 key locations. Following on from 2018, the granting of the Duqm-1(within SEZAD) and Duqm-2 sites have been secured. Another main achievement for 2019 was awarding the wind resources assessment contract. This will entail on-site mobilisation, followed by the installing of the Met Mast at the prioritised sites: Sur, Ja'alan Bani Bu Ali, Duqm-1 within the Special Economic Zone in Duqm (SEZD), Duqm-2, Shaleem and Sadah. Moreover, the site measurement will be carried out for at least 12 months by a specialised contractor who was selected by OPWP through an open competitive tender. In Q4 of 2020, the qualification process for the project is set to take place, and the project’s commercial operations are scheduled to begin in Q4 of 2023.
The Mining Sector is considered one of the most promising sectors for economic diversification in Oman. In 2019, the sector had several projects and initiatives including the Establishment of Mining Blocks initiative, which obtained approvals from eight entities for 15 Blocks, and are now being prepared for auctioning. Also, Ghuzayn copper project received the no-objection letter from the Public Authority for Mining (PAM) to start the mining activities. The GIS integration with some government entities is finalized, and the system is currently ready to be used by PAM to choose coordinates for new mining blocks. Moreover, several initiatives and projects were successfully finalized like Accelerating Review of Inactive Chromite Mining Licences, Implementing a Dynamic Royalty Rate for the Mining Sector, and Structuring a Centralised Corporate Social Responsibility (CSR) Mechanism for the Mining Sector.
Regarding the Development of Mining Innovation Strategy, the final draft of the strategy was completed, and has been approved by PAM, as the achievement percentage reached 30% by the end of May 2020, and the comparison between other countries’ experiences was conducted, in addition to finalizing the report of investment opportunities for clay raw material. The outcome of the innovation strategy is to prioritise the minerals based on their availability in Oman and their value. After preparing the strategy, it will define the possible innovation opportunities for each chosen mineral and develop them into business opportunities. It will also boost the performance of the sector and make it globally competitive by improving existing industries and creating new SMEs.
Another important initiative in the mining sector is Implementing a Dynamic Royalty Rate for the Sector. The aim of this initiative is to study and evaluate the outcomes of the Mining Lab and the Mining National Strategy, focusing on how the royalty rate is calculated, then suggesting other alternatives. During 2019, the working group have finalised the second draft of the evaluation report and presented three alternatives to the Board of Directors. The Board approved the first, which was based on the outcomes of the Mining National Strategy: to have 6% as a royalty rate for the metals and 10% for the industrial minerals.
Information and Communication Technology (ICT) sector is a driver of growth, innovation and transformation for other sectors, as it is an economic sector that enables other sectors. ISFU has worked hard during the second half of the year to achieve the milestones of the ICT sector projects, which were added to the dashboard in June 2019.
Digitisation of Key Public Services was one of the major projects for the sector in 2019. This project intends to further accelerate the digital transformation of the most important government services in order to improve their quality and increase demand. It will target 64 government entities over the period of 5 years – carried out through the implementation of a public-private partnership (PPP) financing model. In 2019, the digital transformation roadmap was approved and rolled out.
Another project is Last Mile Services to Support SMEs (LMX), which aims to analyse the workflow with regards to connecting Oman’s Last Mile of broadband – the portion of the broadband network that physically reaches houses, residential complexes, companies, etc. This project initially focuses on internet connections and it may include Internet of Things (IoT) devices and CCTV services etc. It seeks to propose a viable framework that integrates Omani SMEs and technicians in the ecosystem. It also aims to build national capacity, provide more jobs for Omanis, and support start-ups and SMEs specialising in this field. The project achieved 100% of its targets, as 60 Omani technicians were trained and 17 SMEs were established.
In 2019, ICT sector also worked on Introducing a Special Incentive Programme to Attract High Value ICT Activities into Oman. Three central components for this programme were identified: 1. Providing an attractive package of incentives: This includes a complete package of material incentives, such as discounts, tax exemptions and other incentives, such as e-residence, and ease of restrictions on recruitment controls. 2. Determining the programme management and market access strategy. 3. Developing a world-class infrastructure: This would first entail identifying a specific location with ample office space – where new technologies could be tested, and which would function as a platform from which to create a high-quality network with competitive tariffs. In 2019, the incentive programme was designed and approved, which is expected to increase the Sultanate’s competitiveness and make it a hub for major investors.
