Launched in 2020 and serving as an ambitious road map for Oman’s future, one of the key objectives of Oman Vision 2040 is to create a diverse and competitive economy. To achieve this, the sultanate is actively moving away from its dependence on oil and gas, and is exploring sectors such as manufacturing, tourism, logistics and agriculture.
The government has also identified numerous ways that it can promote economic diversification, such as introducing pro-investment laws and reducing bureaucracy. Oman also now allows 100% foreign ownership of companies across a broad variety of sectors.
“We are reimagining economic growth by streamlining and digitizing procedures to foster a more diversified, enterprise-driven environment,” explained Qais Mohammed al Yousef, minister of commerce, industry and investment promotion. “Oman is leveraging regional cooperation, innovation and public-private partnerships, areas where we’ve seen more than 25 years of success.
“We’re also implementing key reforms laying the foundation for long-term stability. These include the introduction of a 5% value added tax and the Foreign Capital Investment Law 2020, allowing 100% foreign ownership. The Commercial Companies Law has also reduced bureaucratic hurdles.
“The impact of these reforms is reflected in our foreign direct investment figures. By the end of the third quarter of fiscal 2024, FDI in Oman reached approximately $69.28 billion, marking a 16.2% increase from the same period in 2023,” he said.
These impressive FDI figures are a testament to the work being carried out by the government, in particular Invest Oman, which aims to facilitate large-scale investments in sectors crucial to Oman Vision 2040.
“We provide end-to-end support, helping investors navigate the entire process from exploration to establishment. Each client is assigned a specialist relationship manager to expedite arrangements and formalities. We also have 15 government bodies within our building, making vital information and connections easily accessible,” said Nasser al-Kindi, CEO of Invest Oman.
“Currently, we are seeing significant attention being paid to the renewable energy sector, particularly as Oman positions itself as a competitive producer of green hydrogen, with projections of 1 million tons produced annually by 2030 and up to 8.5 million tons by 2050.
“This creates opportunities across the value chain, including the manufacturing of wind turbines and solar panels. Moreover, Oman’s manufacturing sector has seen remarkable growth, attracting $5.45 billion in FDI by September 2024, marking a 51.9% increase over 2023.
“Downstream manufacturing, such as automotive production and white goods, as well as processing metallic and nonmetallic minerals in mining, are key areas of opportunity. In logistics, integrated cold chain solutions and e-commerce fulfillment are emerging as key growth areas, while in agriculture and fisheries, food processing and aquaculture are gaining significant attention,” al-Kindi said.
With Oman making significant strides in its renewable energy and green hydrogen sectors — including a wave of projects to help the country reach its target of having renewables account for 30% of the energy mix by 2030 — Invest Oman has seen increased overseas interest in the sustainability sector.
“Sustainability is becoming a key driver of investment, with Oman’s rigorous efforts to achieve its target of carbon neutrality by 2050 through initiatives like the National Strategy for an Orderly Transition to Net Zero, the establishment of the Net Zero Centre and policies promoting sustainability,” al Kindi said.
Sustainability is also playing a role in expanding Oman’s export markets, al Yousef noted.
“Sustainability is key, with manufacturers focusing on compliance with packaging, labeling and product design regulations, which also contribute to our 2050 net-zero target.
To further grow, we’re negotiating free trade agreements, including the Gulf Cooperation Council and Japan FTA, which will strengthen trade with Japan.”
The diversification of the export market is another major focus for Oman, which has traditionally been dominated by petroleum products.
“Our exports cover oil, gas and fertilizers, but it also includes metals, seafood, agro-products, textiles and niche items like health foods,” al Yousef said. “This helped us to reach $62.6 billion in exports in 2024, a 6.8% increase from the previous year. This growth is supported by incentives, infrastructure, tax benefits in Oman’s free zones, and free trade agreements with markets like the U.S. and Singapore.”
Oil and gas have traditionally dominated Oman’s exports to Japan, but new opportunities are arising that are set to enhance bilateral economic cooperation between the two countries.
“Looking ahead, Oman’s renewable energy resources will play a pivotal role in future collaborations, particularly in clean energy. The visit of Japan’s liquefied hydrogen carrier, Suiso Frontier, to Muscat in August 2023 symbolizes this growing partnership,” al Yousef said.
“Additionally, there’s potential for increased collaboration in tourism, especially with new sports tourism experiences complementing Oman’s cultural, luxury, eco and culinary offerings.
“Oman’s agriculture and fisheries sector also offers substantial opportunities, demonstrated by investments such as the Gulf Japan Food Fund’s $10 million investment in Oman Fisheries and a joint venture in poultry farming. These examples illustrate the diverse and expanding opportunities for deeper economic cooperation.”
Al Kindi added: “We are focused on deepening Japanese participation in our economy. We aim to present Japan with new opportunities as we diversify our economy and pursue sustainable development, and Invest Oman is here to support both existing and potential investors in this exciting journey.”
https://info.japantimes.co.jp/international-reports/pdf/20250625B-GI_Oman.pdf
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