Q: What are the most important parts of Oman's new investment law that will affect foreign investors?
A: Oman’s new investment law has been drafted with experts from the World Bank, and primarily it relaxes the existing controls on foreign investment into Oman. It looks specifically at an attempt to demolish the minimum amount of capital needed to start a company in the country.
It also makes the distinction between two things that were bundled together – getting a licence to do business in Oman and getting an investor visa. Unfortunately, the foreign investment licence has been abused by people who do not seek investment but rather the legal status of being a foreign investor – and that’s something that this new law [has had to deal with].
Q: In which sectors are you hoping to attract more investment?
A: We want to encourage investment in transport, logistics, tourism, agriculture and mining. We are looking at a transformation of the 'single goods' economy by increasing local added value through those sectors as well as fisheries, services and human capabilities.
Q: What are the additional services the new investment law will offer?
A: The law also relates to our Invest Easy platform, which we didn’t have previously. We are launching a one-stop portal which so far offers 55 e-services, including a unified portal allowing all parties involved related to customs to be connected. [It started] from last year, and we hope by the end of April we will have all the services related to the Ministry of Commerce and Industry, and we will be able to showcase the first full version of Invest Easy. But as of now it is incomplete.
Q: What has Oman been doing to adapt to current global oil prices which have led to a major drop in state revenue?
A: We have been gradually doing two things at the same time. We’ve slowly and in a controlled manner started dropping our spending. We do not want to create a big vacuum, which is why the drop has been done over a few years. We started that as soon as we felt the pinch, and that was [reflected in] the budget of 2015. We then dropped it again in 2016. We have used some of our investments and assets to fulfil some of our immediate needs and we sold some of those.
We have also borrowed. At the same time, this allowed us to think slightly differently. And now you’re starting to see the initiatives of the private-public partnerships, which we need to increase to chase growth. This situation has allowed us to privatise faster.
Q: So what can we expect to see now with respect to Oman’s FDI landscape?
A: We are now seeing a shift. All government companies that were fully government owned and managed are now moving to holding companies, separating them from the Ministry of Finance and allowing them to grow on their own merit. There will be seven or eight holding companies as opposed to about 65. And they will work and on their own to get private investment and private lending.
And this is where the opportunities for foreign investors lie, which is why the law is so important, to kick-start [this process and ensure it is] not hindered by local SMEs who fear they will be taken over. The law has to protect them, but open up for the greater part.