RIYADH: Oman’s non-oil sector experienced a 4.2 percent growth year on year in the first half of 2024, driven by the country’s strategic focus on economic diversification as outlined in its 10th Five-Year Plan (2021-2025).

In an interview with the state-run Oman News Agency, Nasser Al-Mawali, undersecretary of the Ministry of Economy, highlighted that this expansion marks significant progress in Oman’s efforts to reduce its dependency on oil revenues and build a more resilient economic base, in line with the objectives of Oman Vision 2040.

By mid-2024, the non-oil sector contributed 13.5 billion Omani rials ($35.1 billion) to the country’s gross domestic product, up from 13 billion rials during the same period in 2023. This sector now accounts for 72.2 percent of Oman’s GDP at constant prices.

Al-Mawali attributed the continued growth in non-oil activities to national programs aimed at accelerating economic diversification and expanding the productive capacity of the economy. The 10th Five-Year Plan, which forms the first phase of Oman Vision 2040, prioritizes increasing private sector participation, supporting small and medium-sized enterprises, and broadening the country’s economic base.

According to Al-Mawali, strategic initiatives under this plan have reached a 90 percent implementation rate as of 2024, with major accomplishments in sectors such as green hydrogen, logistics, pharmaceuticals, and fisheries.

Foreign direct investment in Oman reached approximately 26 billion rials by mid-2024, up from about 17.8 billion rials at the end of 2021.

The country’s overall GDP, at constant prices, grew by 1.9 percent in the first half of 2024, rising from 18.4 billion rials to 18.7 billion rials compared to the same period in 2023. At current prices, GDP increased from 20.4 billion rials to nearly 21 billion rials.

While the non-oil sector posted strong growth, Oman’s oil sector experienced a 2.5 percent decline during the same period, primarily due to a 4 percent drop in crude oil production. On a more positive note, natural gas activities saw a 6.6 percent increase, providing a boost to the energy sector.

Al-Mawali emphasized that the rise in non-oil activities has helped provide a stable foundation for economic growth, buffering the country against fluctuations in global oil prices. Key projects, such as the Duqm Refinery and the development of the integrated economic zone in Al-Dhahirah in partnership with Saudi Arabia, have significantly bolstered Oman’s industrial capabilities and enhanced export potential.

The Duqm Refinery, inaugurated earlier in 2024, is expected to play a crucial role in increasing the manufacturing sector’s contribution to GDP.

Oman Vision 2040 targets an average annual GDP growth rate of 5 percent. So far, the country has achieved a growth rate of around 4.5 percent over the first three years of the 10th Five-Year Plan, indicating strong progress toward this goal.

The 10th Five-Year Plan also aims for an annual growth rate of 3.2 percent in the non-oil sector, with a long-term objective of increasing the sector’s contribution to GDP to 90 percent by 2040.

On a separate note, Oman’s banking sector saw positive growth in the first half of 2024, with total credit rising by 5 percent, reaching 32 billion rials by the end of September. Credit extended to the private sector increased by 4.2 percent, amounting to 26.7 billion Omani rials.

The majority of this credit was allocated to non-financial corporations, which accounted for 45.2 percent, followed by individual borrowers at 45 percent. Financial corporations received 6.3 percent, and other sectors made up the remaining 3.5 percent.

Total deposits in Oman’s banking sector grew by 13.7 percent, reaching 31.6 billion rials as of September. Private sector deposits saw a significant increase of 12.7 percent, totaling 20.7 billion Omani rials.

According to the Central Bank of Oman, individuals held the largest share of private sector deposits at 50.2 percent, followed by non-financial corporations at 29.5 percent, and financial corporations at 17.8 percent. Other sectors accounted for 2.5 percent of the total private sector deposits.

RIYADH: Saudi Arabia and Tunisia have signed a memorandum of understanding to strengthen bilateral cooperation and promote direct investments between the two nations. 

The deal, which was inked by Saudi Minister of Investment Khalid Al-Falih and Tunisian Minister of Economy and Planning Samir Abdel Hafeez in Tunis, focuses on sharing regulations and laws to enhance the investment environment in both countries. 

The agreement, which also aims to improve investment opportunities, was discussed during a meeting attended by Saudi Ambassador to Tunisia Abdulaziz bin Ali Al-Saqr. The talks covered several sectors of mutual interest, including industry, transport, and logistics, with a focus on enhancing collaboration and facilitating joint ventures, the Saudi Press Agency reported. 

Tunisian President Kais Saied welcomed Al-Falih, where the Saudi minister conveyed greetings from King Salman and Crown Prince Mohammed bin Salman, expressing the Kingdom’s commitment to Tunisia’s ongoing progress and stability.  

Saied thanked Saudi Arabia for its leadership role in the Arab and Islamic worlds, praising the Kingdom’s efforts in fostering regional unity and development. 

He added that the agreement marked a significant step in strengthening economic ties between the two countries, with the MoU serving as a catalyst for joint development initiatives. 

The deal follows recent discussions on strengthening industrial and economic cooperation.  

In October, Saudi Vice Minister of Industry Affairs Khalil bin Salamah confirmed to Arab News that collaboration with Tunisia was imminent, noting that the two countries were in the process of selecting key sectors, such as pharmaceuticals and automotive components, for initial investments. 

He emphasized the need for common policies among Arab nations to serve as a foundation for regional collaboration across various industrial sectors. 

On the sidelines of the Multilateral Industrial Policy Forum in Riyadh las month, Tunisian Minister of Industry, Mines, and Energy Fatma Thabet Chiboub also pointed out that Tunisia’s distinctive mining resources presented significant opportunities for Saudi investors.  

She emphasized the automotive components and pharmaceutical industries as key areas for potential collaboration, while also expressing concern that the current level of investment from Saudi Arabia did not fully reflect the bilateral relationship’s potential. 

The MoU is seen as a crucial step in deepening the economic and industrial ties between Saudi Arabia and Tunisia, both of which are looking to diversify their economies and create new growth opportunities through strategic partnerships.