State of Calm
SITUATED ON THE ARABIAN PENINSULA, often amid Middle East chaos and turmoil, Oman manages to maintain a countenance of decorum and civility. Evading military clashes between its neighboring states, it implemented long-range plans for development and emergence. Much of the activity focuses on its capital city, Muscat.
Lying between the El Hajar Mountains and the Arabian Sea, Muscat serves as the seat of the country’s political, administrative and economic systems and home to a third of the country’s 4.5 million residents. With its proximity to the sensitive Strait of Hormuz, Muscat proved a historically important trading port in the Gulf of Oman, attracting foreign tradesmen and settlers who came to trade in fishing and agriculture. Persians, Spaniards and Ottomans were among overseas travelers to ancient Muscat, admired as “very elegant” by a 16th-century Portuguese writer.
Muscat’s sprawling 1,400 square miles divide into three principal urban areas: Muscat proper, the original settlement and now an enclave of restored historic homes and buildings; Waterfront Muttrah, the harbor scene of shipping and cruise ship anchorages, upgrading to enhance its appeal to visiting tourists; and the commercial district centered in Ruwi, a cluster of high-rise apartments, office buildings and headquarters of international companies.
Ruled since the 18th century by the Al Said Dynasty, friction with imams of the interior destabilized the sultanate until 1970 when Qaboos bin Said, with assistance from the British, overthrew his father in a bloodless coup. Consolidating and renaming the region the Sultanate of Oman, Sultan Qaboos united tribal territories and launched programs to end the country’s isolation and to use oil revenues for modernization and development. Slavery was abolished, and freedom of religion was allowed.
To promote internal stability and to supplement expats and immigrants, in 1988 the country initiated Omanization. The local population is enlisted and trained to integrate into the workforce, expanding the economy and infrastructure. Companies are rewarded for increasing their quota levels toward the target goal of 72 percent local personnel. Five-year development plans initiated in 1976 resulted in the establishment of the petroleum industry; construction of the new shipping port, Mina Qaboos; and new ministries for social services, health, education and the tourist industry. Oman emerged with a higher standard of living than that of neighboring countries.
As it has throughout history, trade dominates the economy, with oil products joining the traditional exports of dates, fish and mother-of-pearl. Muscat is home to multibilliondollar conglomerate CK Industries, and major trading companies Suhail Bahwan Group and Saud Bahwan Group partnered with dozens of international corporations including Toshiba, Toyota, Hewlett-Packard, Mitsubishi, General Motors and Chrysler. Petroleum Development Oman — a joint operation of the government, Shell, Total and Partex — reported a combined oil, gas and condensate production record for 2016 equal to 1.29 million barrels of oil equivalent per day, with a growing expansion into hydrocarbon, renewable energy generation and water management. Established in 1988, the principal stock exchange, the Muscat Securities Market, operates with transparency, disclosure regulations and requirements. Numerous hospitals, clinics, universities and schools thrive in the private sector.
The country applies a multitude of assets to lure investors: the educated and largely bilingual workforce; good health care and schools for families; easy access to global markets through a modern infrastructure network; and a stable, secure and predictable investment climate. Dependent on imported goods, Oman promotes policies that welcome entrepreneurs and small businesses. Grain and vegetable farming, gas stations and haulage, tourism and perfume shops, electronics and home appliances, commodity stores, bars and restaurants list among suggested venture opportunities.
Clearly, the leadership of Sultan Qaboos deserves credit as a key to Oman’s progress. The longest-serving monarch in the Arab world, a devotee of opera and classical music, he received his education in India and at the Royal Military Academy Sandhurst in England. While his rule is absolute, he is said to rely more on the business elite than on family members for counsel. Nearing age 80 with no clear heir, the delicate issue arises of whether his successor would maintain absolute power or take steps to separate state powers.
Peaceful protests following the Arab Spring raised issues of job opportunities, salary increases, establishment of Islamic banks and expulsion of some current ministers. But for the time being, the outlook for Muscat includes a continued, methodical integration into the global scene.