This is a best prospect industry sector for this country. Includes a market overview and trade data.
The Oman Logistics Strategy lays out long-term objectives for increasing the contribution of the logistics sector to GDP. Oman’s strategic objectives over the past several years have focused on easing congestion and enhancing capacity by investing in infrastructure and technology for new ports and road links, as well as in expanded routes for national airline carriers. Oman aspires to leverage its deep-water ports on the Gulf of Oman and the Indian Ocean to become one of the world’s top ten logistics hubs by 2040.
All seven commercial ports in Oman are state owned. Three are deep-water ports: Sohar in the north, Duqm at the center of the country’s coastline, and Salalah in the south. All three deep-water ports operate under concessions through joint ventures between the government and foreign private companies and connect to 86 ports in 40 countries. The strategic port town of Duqm, located halfway between Muscat and Salalah on the Indian Ocean, is Oman’s flagship development project. Duqm has a new port; naval base, dry dock, fisheries hub, industrial free zone, hotels, power and desalination plants, an oil tank storage terminal, and an almost-complete refinery. The government also aspires to build a rail line to facilitate the transfer of mineral resources from the Shweimiyah area in Oman’s Dhofar governorate to the port.
Road construction is another major focus of domestic and regional development. In December 2021, the government opened a new road through the Empty Quarter connecting Riyadh with Muscat and other major Omani cities, including Duqm and other Omani ports. Oman has an ongoing drive to expand its bus and private taxi systems. In December 2021, Oman opened a dry port at Khazaen Economic City, a 20-square mile logistics-led development outside Muscat, featuring a free zone, an automobile market, and factories. The government is also considering privatizing the national bus and ferry networks.
As part of Oman’s strategy to expand routes and designations, Oman in 2022 authorized U.S. carrier Jet Blue to commence code-share service to Oman with Emirates Airlines. In 2021, the Sultanate’s flag carrier, Oman Air, entered into a codeshare agreement with Qatar Airways in a move that provides flights to the United States via Doha. Oman’s first budget airline, Salam Air, has expanded its regional routes. Oman’s modern Muscat International Airport opened in March 2018. Duqm Airport’s passenger terminal opened in September 2018, with plans to add regional and international routes. Oman’s Salalah and Sur airports also serve international destinations.
The government anticipates a larger role for the private sector in the future, not only in providing capital, but also in tie-ups with the public sector to help manage state assets.
Oman imports vehicles for domestic sales and for re-export to regional markets. In addition to a continuing market for passenger vehicles, Oman is importing construction, airport, and port equipment including buses, aircraft, X-ray security screening equipment, cranes, rubber tire gantries, port access control and security solutions, logistics software, and engineering, project management, cold storage supply chain, and consultancy services. Oman anticipates re-starting its rail project to connect to the planned GCC rail line and is evaluating the feasibility of a rail connection between Sohar Port and Khazaen.
Oman’s strategic location on the Strait of Hormuz, as well as its deep-water ports on the Gulf of Oman and Indian Ocean outside of the Strait, are main selling-points as its logistics infrastructure grows and connectivity improves. In 2022, Oman appears to be re-emerging from budget constraints that had led it to place several large infrastructure projects on hold.
The Special Economic Zone Authority for Duqm and the Port of Duqm are actively seeking foreign investment to help finance development. In addition to the massive array of construction projects, Duqm requires infrastructure development in sewage treatment, drainage, water desalination, power plants, buildings, telecommunication services, and landscaping. In July 2021, Asyad built its first new ship at Duqm’s dry dock, which also provides ship repair and maintenance services. Saudi Arabia is considering establishing an industrial zone in Duqm. The Duqm refinery project offers transportation and logistics opportunities. Oman’s two established ports in Sohar and Salalah also present significant opportunities. Sohar’s free zone has been at the forefront of Oman’s downstream manufacturing growth. The industrial zone is seeking to attract additional manufacturing facilities and distribution centers. Sohar also hosts Oman’s largest operating oil refinery.
Salalah is in a prime location at the crossroads of East-West shipping, with weekly connections to and from the U.S. East Coast. Its port has a container terminal with seven berths of up to 18 meters’ draft and a general cargo terminal of 12 berths of up to 16 meters’ draft, with infrastructure to handle the world’s largest container vessels, as well as bulk cargo, bunkering, and warehousing.
Oman is increasingly seeking private sector investment and expertise, particularly to develop its projects pipeline through joint ventures or PPPs. The government will also rely on PPPs to run the four terminals for containers, general cargo, bulk goods, and liquids at Port of Duqm; and in the developments of ports at Khasab and Shinas in the north. The government seeks to transform Port Sultan Qaboos into a mixed-use waterfront cruise and leisure destination under a PPP model.