Interview with HE. Mr. Al-Futaisi, Minister of Transport and Communication, Oman

Business Focus: One general question, Oman has a strategic location and had an important role within the Gulf region connecting the different countries throughout history. What has that meant for Oman and for its sustainable social economic development?

As you said there is a strong focus on diversification to improve the economy and indeed it concerns 5 main sectors that can play a role to diversify our country. These sectors are tourism, transport & logistics, mining, fisheries, industry & manufacturing. The ministry took the lead in bringing the transport & logistics into a successful sector. A sector not only looked as a supportive sector for others but also a sector by itself that can improve its part in the GDP of the economy. Last year we have written our logistic strategy and it was approve by the cabinet. We call it Oman Logistic Strategy. It is until 2040. The strategy is not concentrated only on infrastructures because the infrastructures that you have or that you are going to build are enough to play a role as a logistic hub in the region. The experts see our 3 main ports, Salalah, Duqm and Sohar as world class deep port and they will play a major role in building a hub. They are quite impressed by our road network and we are working on express highways, in construction now. It is a matter of few years now and they will connect all the main economic ports.

Airports are going on and some of them have already opened and are in operation now. In one or 2 years Muscat will open a new terminal. Also railway project, we have advanced on the project and we are now awarding contracts to different actors. All of these are enough to play a role to make Oman a logistic hub in the region. Our logistic strategy will concentrate more on the soft infrastructure. The strategy has four pillars, trade facilitation, processes, regulation that controls the import-export; we will try to ease the trade for the people in the logistic sector. Second one is technology. There is lot of advancement worldwide regarding technologies in the logistics sector. To succeed we need to be at the same level to be able to compete with other logistic hubs.

The third important pillar is people. We need more education and training in the logistics sector so that the next generation can play a role in it. We do have a young generation that can play a role. We just need to give them the good training, education and qualification. We will focus on vocational training and dedicated training center for railway sector, logistic sector. Last pillar is the marketing, we need to focus on certain markets and build relationship in order to bring investors in Oman. We need to brand Oman as a whole, as a logistic hub, not only branding this or this project. We have created an institution to play a role in the implementation part. They started to recruit the right people to implement our strategy. It is not an easy subject. Changing practices, new procedures, building people takes time. In order to succeed we need to develop these soft infrastructures and aligned all the parties with the government strategy.

Business Focus : In the light of becoming this logistic hub, what are the key competitive advantages Oman has compared to the other countries in the region?

As you said the location, geography helps a lot. We are in the Gulf but at the same time outside the Gulf. So we can have easy access to central Asia, to Iran, to Africa, to India and we are also positioned on the main lines that connect east and west, the maritime shipping line. Secondly, the government in the last 45 years spent a lot on infrastructure. We are proud of our world-class infrastructures and of the future ones which will be opened in a next future. Also in terms of soft infrastructure we are working on it, we admit that we need to be in better position. Nowadays, companies will not look at locations where trade is not facilitated. Cost and time are very important. Business atmosphere, transparency and laws in Oman are also very advanced. The legal structure we have in the country is much better than the one you can find in lot of places of the world. Stability, Oman has a clear policy in term of international policy, we do not interfere in other countries’ affairs, keeping Oman away from the problems of the region.

Business Focus : To make it happen, how, as a minister, do you see the potential of partnership between private and public actors (PPPs) to create a more efficient businesses?

We are concentrated on 3 main economic zones, Salalah, Sohar, and Duqm. In each economic zone, you will find port, airport, railway terminal, road network, and free zone and an industrial area. We do invite private investors from all over the world to come and utilize all the facilities provided in the free economic zone. We can assure them a connection with all the population of the Gulf, which represents a significant Market. If a company installs itself in Sohar it can easily approach Iran, India, GCC where there are big population. If you are based in Salalah you can approach Africa. We are looking at other major projects, PPP, we are developing for example Sultan Qaboos Port. His majesty is very clear. He wants to convert this port into a waterfront port for tourism. The first step, which is the hardest one, has been completed, we transferred the commercial activity to Sohar. Now the area is ready to start waterfront activities. We have revised and finished the master plan. Now we are establishing the waterfront development company. This company will be mandated to do all the development in that project. We are negotiating. It will be government plus pension fund or private sector cooperation. Once the development company is established there will have potential private contracts for hotels…it will take time, 6 to 8 years to have it all ready. I am sure it will be one of the most famous waterfront in the region with the mountains behind, the forts, the link to the souk and to the royal palace. There is no other waterfront like that in the GCC countries.

Business Focus : The transport sector is quite wide, air, port, road and so on with lot of potential. How do you see it being a complement to the oil & gas sector in regard of the diversification strategy?

Logistic & transport sector is one of the 5 sectors which is key for diversification. The success of this as I say will come from the integration of the sector and how we link and implement Oman logistic strategy. That relies mainly on soft infrastructure. If we succeed in the next 5 years…we have put ambitious targets in term of how Oman manages to increase our GDP contribution, our shares on the GCC market, our position on logistic index worldwide. We have put these targets and ambition and in 2020 we will be able to see if we achieve or not these ambitions. With its position, if we focus on people and marketing I am sure we will succeed.

Business Focus : Uk and Oman have strong relations. Uk being the larger investor in the country. In term of technology, human capital, foreign investment, what impact UK can have on Oman development?

UK is a historical partner; we have a long common history. They have been our partners in construction, designing, in lot of projects happening at the moment, even in operations of the facilities. We think that there is still a potential for direct investment from UK companies to come and invest in the 3 economic zones, Salalah, Duqm and Sohar. I wish UK will think about these 3 zones as distribution centers, even if they have their manufactories in UK or wherever, we want them to consider Oman as a distribution center to the region and to the countries around us. They should look at Oman’s position and at the infrastructure that we have to distribute their goods. We are very thankful for their current presence in the different sectors of the economy.