MUSCAT: Jan. 5

The mining sector is envisaged as one of the five key drivers towards GDP during the 9th Five-Year Plan as Oman is diversifying its sources of income, according to the minister of commerce and industry. "Mining is a very important sector for the economy as this is one of the five best sectors which can drive the economy during the current plan. It also complements the logistics as well as downstream industry sectors," Dr Ali bin Masoud al Sunaidy, Minister of Commerce and Industry, told the Observer.

An MoU (memorandum of understanding) to form a company with RO 100 million paid up capital was signed by State General Reserve Fund (SGRF), Oman Investment Fund (OIF), Oman Oil Company (OOC) and Oman National Investments Development Company (TANMIA) at the CMA (Capital Market Authority) yesterday. The four partners agreed to incorporate the new company, as well as to provide the necessary support to meet all the requirements including legal, technical and financial framework of the new entity, in addition to fulfilling the requirements in relation to public offering of the company's securities, once it is duly incorporated and listed on Muscat Securities Market after analysing the technical and financial feasibility results.

The founders own 60 per cent of the capital and the remaining 40 per cent will be offered for public subscription. Dr al Sunaidy said that mining sector is one of the five sectors which were identified to be drivers for public and private investments. He added that the company will integrate with three key sectors namely mining, logistics and manufacturing industries sectors. "Many sites have good potential for investments, especially the world needs gypsum, which the Sultanate has in abundance. Moreover, facilities are provided in Sohar and Salalah ports to transport the bulk mining materials," he added. He said that despite the humble contribution of the mining sector to the GDP during the past years, the contribution has increased to 20 per cent in 2015. With the new investments in the sector, its contribution to the GDP will increase in the future.

"I hope that shares will be offered for subscription during the second or third quarter of this year," he said. Speaking on the effect of fuel price increase which will take effect from January 15, he said that the current prices are very close to international prices and the contribution of the transportation cost to the total cost of products is limited except for the transport and construction sectors. "Therefore there will be close cooperation between the Ministry of Commerce and Industry and the Public Authority for Consumer Protection to protect consumers and control any unjustified increase in prices." He pointed out that since there is a ban on export of raw marble, it has to be cut and manufactured in the country.

Dr Sunaidy said that the ministry in collaboration with the Ministry of Environment and Climate Affairs is studying to establish new factories in the field of mining. These factories will use clean coal imported from areas which are far from residential places. "Banning resale of mining licences is not on the agenda of the ministry, but regulating the mining sector is our prime objectives and a mining regulation is on the anvil to control this sector that will allow you to be able to trade in this sector," he said and added that one cannot sell the licence but the business activity for which the licence has been issued.

Commenting on this partnership and its positive impact on the national economy, Abdul Salam Mohammed al Murshidi, SGRF's Executive President, said: "The great attention accorded to the mining and mineral sector comes in line with the government's diversification plan, with a view to boost national development. He added that such strategic partnership is aimed at adopting the best international practices in the field of mining and associated operations, by focusing on local community and surrounding environment.

© Oman Daily Observer 2016