Oil and its related exports accounts for 75% of Oman's total export earnings and almost 40% of its gross domestic product (GDP). What has made the development of the Omani economy over the years challenging but yet interesting is that the country only started to produce and export oil on industrial scale in the early 1970s. Therefore in addition to having a 5 year conflict with Communist insurgents from Yemen in the early 1970s, Oman has since had to play catch up with its neighbours in areas of economic development and expansion.

Nevertheless through sound investment of oil revenues in Oman's economy the Omani government has managed to increase the standards of living enjoyed by its citizens.

However Oman's oil resources are depleting with some estimates suggesting the country's oil resources will be diminished by 2022. The Omani government is aware of this fact and has started taking concrete action in order to reduce Oman's dependency on oil. The main government plan in this area is called vision 2020. In accordance to this plan, by the year 2020 Oman's dependency on oil as a percentage of exports will be reduced by 29% (see table below), whilst Oman's share of non - oil exports will be increased to make up for the reduction in revenue from oil. This plan is in its first five year phase and the results have so far been promising. The positive results are a clear indication of the Omani government's determination and willingness to take the required economic action to achieve its goals. Such steps have so far included joining the World Trade Organisation and bringing about laws protecting investments and intellectual property.

Figures from the Omani Centre for Investment Promotion and Export Development

By: Meir Javedanfar- www.meepas.com

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