MUSCAT -- The Ministry of Commerce and Industry is revising the Foreign Capital Investment Law with a view to projecting the Sultanate as a more attractive investment destination. In the meantime, the Ministry is working to address the challenges facing the national industry to tackle a trend among some advanced and developing countries to impose protectionism against foreign goods and provide subsidy for their goods against Omani products.
This came in a statement here yesterday by Commerce and Industry Minister Dr Ali bin Masoud al Sunaidy before Majlis Ash'shura, adding that two new industrial estates will be set up in the Wilayat of Ibri and the Wilayat of Al Mudhaibi. The minister said that attention is accorded to small and medium enterprises, but it is necessary to tackle all sorts of manipulation that may depelete the support offered to small investors.
The minister said that the mining sector is witnessing unusual rush to obtain licences without any indications for productivity, but the ministry is focusing more on privately-owned crushers which take the shape of closed or general partnerships in a bid to regularise mining operations. He underlined the need to issue a new mining law in the Sultanate and pay more attention to technical aspects.
The minister described as impractical attempts to raise national manpower pay ceiling at private establishments above the recommended RO 235. In his statement, the minister said that the Capital Market Authority finalised a study to address the challenges facing the stock market in the Sultanate, namely the shallowness of liquidity and initiatives that can be used as tools for financing. The session was opened by Shaikh Khalid bin Hilal al Maawali, Chairman of Majlis Ash'shura.
Al Sunaidy said in his statement that the Omani economy has been able to withstand the international economic crisis which impacted the world economy in 2011 and had its repercussions in 2012. In fact, the Omani economy achieved stability, even progress over 2011 and 2012, with the GDP rising by 19 per cent to RO 26,904 compared to RO 22,614.
Meanwhile, domestic trade witnessed good growth over the past two years due to a number of factors, including an increase in spending and purchasing power among consumers in the backrops of increased employment of Omanis in the government and private sectors, said the Minister, noting that the contribution of the wholesale/retail trade to the GDP at current prices rose from RO 1.735 million in 2010 to RO 1.945 million in 2011, an increase of about 12 per cent.
Speaking about the commercial uses of ports and their adjoining areas, Al Sunaidy said that, despite the availability of advanced logistic infrastructure in Omani ports, many related activitities are still centred in cities, like warehouses in Al Wadi al Kabeer and Ghala in Muscat Governorate, which compels companies to limit their storage to limited space and face the problem of high cost of transportation.
Foreign trade, fortunately, witnessed good progress, with its volume rising by 25.4 per cent in 2011 compared to 2010 figures, said the Minister, adding that oil exports rose by 32.2 per cent in 2011 compared to 2010 figures, while non-oil exports rose by 20.8 per cent over 2010 figures. In the meantime, the ratio of converting industries to the GDP rose per cent by 20 about RO 2419. Emphasis in the future stage focuses on expanding existing industrial estates and setting up new ones in Al Dhahirah Governorate and North Sharqiyah Governorate, in addition to increasing integration among ports activities and industrial estates activities, particularly in Sohar, Salalah and Duqm.
The Sultanate has faced a number of issues with EU and India with relation to exporting the Omani petrochemical products. It faced some issues also with US with relation to exporting steel pipes and with Ecuador and Pakistan with relation to exporting packing materials. The Sultanate, represented by the Ministry of Commerce and Industry addressed these issues in collaboration with an international law office and some private and public organisations.
Speaking about small and medium enterprises, the minister said that the sector is still unorganised due to its inability to offer more employment opportunities to Omanis in a sustainable way. While First Class establishments sector employes more that 200,000 Omanis, the number of Omanis in SMEs (second, third and fourth classes) does not exceed 10,000, most of whom operate in modest environments lacking in technology and invested with types of illicit trade, with expatrates in this sector standing at more than 600,000 due to low pay.
The SME sector, he said, failed to utilise the good economic growth in the country to generate new jobs, said the Minister, noting that work is under way to form a special body to undertake small and medium enterprises. In his statement, the Minister also spoke about the Consumer Protection Authority which, he said, plays a role different from its counterparts in other countries at times. The consumer authority interferes with price ceilings in a bid to "fill the vacuum" left by the lack legislations against monopoly. This role works contrary to the mechanisms of free market economy based on demand and display, except in exclusive cases.
"All efforts should be concerted to limit the illicit trade by encouraging entrepreneurship culture and ensure full time management of private projects," he said. The Minister encouraged the use of electronic one-stop-shop in commercial transactions.
© Oman Daily Observer 2013
