Oman opportunities

Weekly News

Oman

Opportunities

12 ~ 16 March 2017

Telegram: https://t.me/omanme

Rise in number of

bounced cheques

as Oman economy

slows down

Despite sanctions

relief, Shell still

cool on Iranian oil

buys

C onsumer

watchdog

recorded 5883

complaints in

Oman

Omani banks plan

to raise capital by

issuing bonus

shares

Oman's power

output up 4.5%

last year

Oman transport:

Mwasalat

warehouse

holding more than

2,500 unclaimed

items

Oman crude price

hits three-month

low

Supreme panel

takes stock of e-

Census 2020

preparations

Muscat: Bounced cheques are increasing across

Oman as residents facing pay freezes struggle to

make ends meet.

The economic downturn in Oman has led to lay-

offs, delays in salary payments and a freeze on

housing, flights allowances and expenses.

Those residents who have chosen to remain in the

Sultanate hope they can weather the storm, but

some employees are reporting non-payment of

salaries for more than three months, leaving

landlords with piles of rent cheques they cannot

bank.

In some cases, agencies and landlords are

demanding a OMR10 fee to hold a cheque for a

month without banking it.

Indian expat Sabita, who lives in Ruwi, said that

for the last three months she has been paying

OMR10 more to her real estate agent for holding

the rent cheques.

London: Royal Dutch Shell has bought only

three cargoes of Iranian oil since sanctions were

eased a year ago, a small fraction of what it used

to buy and an indication of the legal difficulties

and high prices that still hamper the trade.

The Anglo-Dutch firm did not give a reason for

the drop in purchases, which were disclosed in its

annual report, and the company declined to

comment further.

But oil trading sources say Iranian oil is often too

expensive and in any case remaining sanctions

make dealing with the Islamic Republic a legal

minefield.

As an example of sanctions-related difficulties,

Shell's filings showed it had to disclose payments

of only a few hundred dollars when its employees

bought tickets with Iranian airlines.

After an accord was reached over Iran's nuclear

programme, the European Union eased sanctions

on Iran in January 2016 and the United States

lifted some restrictions on dollar trade, moves

that have allowed Iran to raise its oil exports

sharply.

Muscat: More than 5000 complaints were

registered with the Public Authority for

Consumer Protection in 2016 - the majority

against the food sector.

According to data from the Directorate General

of Studies and Development at PACP, 5883

complaints were registered with the authority

last year.

The food consumption sector topped the list of

complaints with 1789 on record followed by

“other products” sector with 1023 while “other-

Muscat: Omani banks listed on the Muscat

Securities Market plan to expand their capital

base.

Four banks have submitted recommendations

during extraordinary general meetings (EGMs)

to increase their capital by distributing bonus

shares among shareholders.

The gross capital of the six listed commercial

banks by December-end of 2016 stood at

Muscat: Gross electricity production in the

Sultanate rose 4.5 per cent to 34,222.6GW, as

against 32,756.7GW produced in 2015,

according to latest data.

Net production went up 4.4 per cent to

33,635GW during the same period, according to

the latest bulletin from the National Centre for

Statistics & Information (NCSI).

Oman produced 377.92 million cubic metres of

water year, logging an annual rise of 12.2 per

cent.

The Governorate of Muscat saw a production

grow by 9 per cent to 170.74 million cubic

metres, while water production in the

Governorate of Dhofar surged 28.5 per cent to

48.33 million cubic metres. Total production

across other governorates went up 11.4 per cent

to 158.84 million cubic metres.

Gross electricity production in the Governorate

of Muscat declined 31 per cent to 3,878.8GW,

while Dhofar logged a 1.7 per cent rise at

3,372.2GW.

Muscat: More than 2,500 items from across the

Sultanate have yet to be claimed, as Mwasalat’s

warehouse is piled with cargo waiting for their

owners.

Ranging from food products, documents and

hand written letters, these items have been sent

by senders, but remain unclaimed by customers

for several reasons.

Times of Oman interviewed Bader Mohammed

Al Nadabi, General Manager for Corporate

Support – Mwasalat, to learn about the

Muscat: Oman crude oil prices fell to pre-Opec

(Organisation of the Petroleum Exporting

Countries) agreement levels on glut concerns as

shale production offset price gains made by

output cuts.

Futures, for delivery in May, traded at $51.32 on

close of last week’s trading at the Dubai

Mercantile Exchange (DME), falling more than

6 per cent in three days. Other oil benchmarks

followed suit, with Brent slumping to $51.39

and West Texas intermediary (WTI) trading at

$48.50, below the psychological mark of $50 for

the first time since December.

The latest drop in prices is a result of statistics

released by the US Energy Information

Administration (EIA), which shows American

oil inventories surged by 8.2 million barrels last

week to a record 528.4 million barrels, forcing

speculators to abandon the long position in oil as

a market overhang loomed over the troubled

petroleum industry.

Baker Hughes reported rising US rig count for a

straight eighth week, lifting the rig count to 617,

the highest since September 2015. EIA reported

a rise of 56,000 barrels per day last week in US

oil production to 9.088 million bpd (barrels per

day), highest in more than a year. Since the

bloc’s announced cuts, US drillers have brought

140 rigs online.

Muscat: Issues related to electronic census 2020

were reviewed at a meeting yesterday.

The Supreme National Committee for the

electronic census scheduled for 2020 on

population, housing and establishments held its

first meeting of the current year yesterday under

the chair of Sayyid Haitham bin Tariq Al Said,

Minister of Heritage and Culture, Chairman of

the Committee.

The Committee reviewed the topics on the

agenda, including the preparedness of the

ministries and various government units in

undertaking the census, and the availability and

status of their own databases.

The Committee also reviewed the timetable for

the implementation of the e-Census 2020 project

in accordance with the time period specified in

the Royal Decree No. 15/2015. The panel

expressed its satisfaction with the workflow and

the practical steps and initiatives taken so far, as

planned earlier.

The Supreme Committee also discussed the key

topics on the agenda and took appropriate

unclaimed goods and how they are undelivered

for weeks, and even months.

Al Nadabi said that part of the problem is that the

customer does not know that an item was sent for

him.

“They sometimes don’t know that they are

receiving an item. The sender would send the

item without notifying the receiver. When the

cargo reaches its destination and we call the

receiver to claim the item, he says ‘No, I don’t

know anything about it’,” explained Al Nadabi.

OMR1.090 billion; reflecting a growth of

OMR85.6 million, compared with 2015. Bank

Muscat, whose capital stood at OMR249.6

million as of the end of December 2016, said it

will distribute 5 per cent in stock dividends (five

shares for each 100 shares), in addition to 25 per

cent cash dividends (i.e. 25 baises for share).

The annual general meeting (AGM) will

consider the recommendation during its meeting

on March 19.

Bank Muscat’s net profit rose to OMR176.8

million, from OMR172.2 million in 2015. Its net

profit represents about 52 per cent of the

OMR342.1 million net profits earned by six

other commercial banks this year.

Most commercial banks saw growth in their net

profits, except for the National Bank of Oman

(NBO), whose profits declined from OMR60.5

million to OMR54.5 million and Bank Sohar,

whose profits slipped from OMR27.7 million to

OMR19.1 million.

“We’re not just a Six Senses resort, but also an

asset of Oman’s Ministry of Tourism, which will

now be featured worldwide, and this is very

good for business in Oman as it will help further

promote the country as a tourism destination,”

she told Times of Oman.

devices are a part of the operating expenses for

the dealer and cannot be re-loaded to the card

holder in any case,” it said, in a written circular

issued recently. PACP said that they are taking

action against merchants charging customers for


services” sector registered 735.

Restaurants and cafes received 567 complaints

followed by barbershops and salons with 347 on

record. The clothing sector registered 292

complaints last year followed by the contracting

sector with 233.

Oman, Iran central

banks sign pact

Bank Muscat’s

sukuk issue

expected this

month, says

official

Oman’s crude

production falls

marginally to 27m

barrels in

February

Oman plans

‘smart’

transformation of

Muttrah city

Consumer protection

i n O m a n d i r e c t s

vendors to display all

taxes on receipts

Madinat Al Irfan

design to save

energy in Oman

Foreign investors

offload shares on

Muscat bourse

Ministry plans to

cancel expired

commercial

registrations

Tehran: Central banks of Oman and Iran signed a

memorandum of understanding on Sunday.

Earlier, Sayyid Badr bin Hamad bin Hamoud Al

Busaidi, Secretary General of the Foreign

Ministry met with Morteza Sarmadi, Deputy

Foreign Minister of the Islamic Republic of Iran.

Sayyid Al Busaidi also met with Dr. Valiollah

Seif, Governor of the Iranian Central Bank.

The meetings dealt with areas of the bilateral

cooperation to serve efforts of promoting the

trade exchange and encouraging investment.

Several meetings and consultations were held

between members of the Omani delegation and

their Iranian counterparts in the monetary and

banking sectors.

The meetings dealt means of enhancing the

banking relations between the two countries.

In this f ramework, a memorandum of

understanding was signed between the central

banks of the two countries. It was signed on

behalf of the Sultanate by Hamoud bin Sangour

Al Zadjali, Executive President of the Central

Bank of Oman (CBO), whilst it was signed from

the Iranian side by Dr. Valiollah Seif, Governor

of the Iranian Central Bank.

Muscat: Silver Star Corporation will organise the

four th in ternat ional P las t ics , Rubber,

Petrochemicals, Printing and Packaging industry

exhibition—Oman Plast 2017—at the Oman

Convention and Exhibition Centre between

March 21 and 23.

Hilal bin Hamad Al Hasani, chief executive

officer of the Public Establishment for Industrial

Estates (PEIE), will formally inaugurate the

fourth Oman Plast at 10 am on March 21 in the

presence of diplomats, government officials,

businessmen and people from the different walks

of life.

During its fourth edition, Oman Plast will

showcase the latest technology and machineries

used in the manufacturing of plastics, rubber,

petrochemicals, printing and packaging. It will

be an ideal platform for Oman and its

neighbouring countr ies to source new

technology and products through this knowledge

forum. As the petrochemical industry is one of

the main components of the Omani economy, the

event will give great impetus to further

diversifying its growth.

Muscat: Energy savings up to 20 per cent are

expected to be realised owing to Madinat Al

Irfan’s sustainable urban design, according to

master developer Omran.

Under a sustainable governing framework, the

multi-million rial project will implement the use

of solar water heaters, solar lighting, smart

architecture to create natural shade zones, and

sustainable materials and efficient HVAC

systems among others to decrease total energy

consumption.

“We are expecting 9 per cent to 20 per cent

savings in total energy consumption in this

project. I believe we are achieving more than 18

per cent in the Exhibition Halls,” Ammar Al

Kharusi, director of development at Omran said

on the sidelines of the Sustainability Forum.

According to Al Kharusi, sustainability equates

not only to energy savings or environment but

encompasses an approach that envelopes people,

planet and profit.

Muscat: Foreign investors are offloading shares

on the Muscat Securities Market (MSM) as net

selling of non-Omani investors has touched

OMR25.15 million so far this year.

Foreigners have been net sellers for OMR11.5

million so far this year. Regional investors also

remained sellers for OMR12.5 million. The

selling was absorbed by local institutional

buyers,” said a research note released by United

Securities. Arab investors (who are not included

in the regional investor category) were net sellers

to the extent of OMR1.5 million.

Foreign investors, including regional players, are

offloading their holdings on the Oman bourse

like other regional markets, mainly due to a drop

in oil prices, which touched a three-month low

last week.

In fact, foreigners were buyers during the initial

three weeks of the year and then remained sellers

for most of the days.They were selling shares of

Bank Muscat, Oman Telecommunications

Company (Omantel) and Ooredoo Oman.

Foreign investors generally show an interest in

stocks, which are highly liquid with better

market capitalisation. “The foreigners are getting

out of the market,” said Joice Mathew, head of

research at United Securities.

Muttrah, preserve the diversity and make the city

more tourist friendly. Our vision is to expand

economic activities and promote a hassle free

environment in the city of Muttrah. We are

looking to enable new business opportunities,

cater to tourists and shopkeepers and ease

parking and traffic issues in the city,” Ali Al

Shidhani, director of research centres and ICT

research told the Times of Oman.

E-services, digital infrastructure and resource

management are all on cards to develop the aging

traditional and business hub of Muscat, which

has played the most significant role in

developing the Sultanate’s economy.

Muscat: New regulations from Public Authority

for Consumer Protection (PACP) reveal that

establishments have to mention or display all

types of taxes on their bills. “The price of an item

and the tax levied on it must be displayed on the

receipt,” according to PACP.

Two years after introducing a Consumer

Protection Law, PACP has released new

amendments to protect customers and

businesses. The executive regulations aim to

protect consumers from any negligence or

wrongdoing by suppliers, as well as giving

business owners guidelines to practice their trade

correctly and prevent them from violating the

law.

The laws also apply to purchases and exchanges,

which are made over electronic communication

platforms. The new regulations consider

products to be adulterated if they are altered in

shape, size, weight, amount, attributes, or

characteristics. The other regulations include

that every bill should display the name of shop,

the registration number and all other registration

data. “It should also mention the date of purchase

for goods or services and the price of the

commodity and the amount of tax,” it said.

Muscat: The Ministry of Commerce and

Industry will cancel a number of expired

commercial registrations which have not been

renewed. The ministry will transfer these

registrations to the inactive establishments’ list

and stop their transactions with public and

private agencies related to Invest Easy Portal.

The ministry has given the owners of institutions

and companies who have not renewed their

commercial registrations six months to act

before taking action against them, according to a

press release.

The list of expired commercial registrations is

now published on the Invest Easy Portal, and the

ministry has allowed the renewal of commercial

registrations through Sanad offices and the

offices. Of law firms.

The number of commercial registers that have

been renewed in 2016 has reached 23,947.

The ministry continues its efforts to improve

procedures and the working environment in the

Sultanate, as well as assist in the processing of

commercial registers to start businesses, with

the fastest commercial registration taking 145

seconds through the Invest Easy Portal. Oman

has been ranked as first in the Arab world in the

Doing Business Index, moving up by 127

positions compared to the previous year.

Muscat: Oman produced 27.16 million barrels

of crude oil in February, equivalent to 970,000

barrels per day, according to a monthly report

released by the Ministry of Oil and Gas here on

Sunday. The report indicates a marginal drop of

0.09 per cent, compared to January 2017.

Of the total production, some 22.53 million

barrels of crude oil were exported in February

2017, equivalent to 948,440 barrels per day - a

fall of 6.4 per cent compared to the previous

month.

China was the major importer of the Sultanate’s

oil, accounting for 82.49 per cent of total

exports, which also shows a growth of 18.33 per

cent over the previous month.

South Korea imported 4.43 per cent of the

Sultanate’s crude oil exports, but the country’s

imports declined by 12.25 per cent compared to

the previous month.

This was followed by Japan and Taiwan, which

increased their imports in February by 2.57 per

cent and 1.08 per cent, respectively.

Muscat: A new collaborative plan proposed by

government institutions has the potential to

transform the face of the historic city of Muttrah.

The city is likely to get a major boost in digital

and public infrastructure to improve the living

environment for residents and make it more

tourist-friendly.

“Muscat Municipality is undergoing a major

rehabilitation project to improve livability in

Muscat: An Islamic bond issue to raise OMR23-

30 million, which is the first tranche of

Meethaq’s OMR100 million-sukuk programme,

will be floated towards the end of this month, a

senior official at Bank Muscat told Times of

Oman.

Meethaq is Bank Muscat’s pioneer Islamic

banking window in Oman.

The bank has already received an initial

approval from stock market regulator Capital

Market Authority (CMA). “We are waiting for a

final approval for the prospectus (from CMA).

Once that is approved, we will come out with the

issue. Before the end of this month, the issue will

be floated,” said Sulaiman Al Harthy, deputy

chief executive officer – Islamic Banking – at

Bank Muscat.

“The sukuk programme will start with a small

amount, maybe (some) OMR25-30 million. We

are testing the market to see the market appetite.

Then we will come out with the second tranche,”

added Al Harthy.


Oil steadies below

$49 as US drilling

threatens longer

glut

MEDC’s initial

public offering

expected before

June, says CMA

chief

Majority of

companies yet to

start VAT

preparation:

Survey

OOCEP named

fastest-growing oil

and gas firm in

Middle East

Iran's biggest

cargo line looks at

London share

listing

Renovation of

hotels won’t hit

Salalah tourism

Demand for skilled

Omanis high in

hospitality sector

Galfar

Engineering’s loss

increases to

OMR10.8m on

additional

impairment

London: Oil steadied below $49 a barrel as US

drillers continued to boost activity, countering

Opec’s efforts to drain a global glut.

Futures were little changed in New York after

falling 9.1 per cent last week, the biggest weekly

loss since November. Rigs targeting crude in the

US rose to the most since September 2015,

according to Baker Hughes. In Libya, crude

production dropped 11 per cent as clashes among

rival armed groups led to the closure of some of

the Opec nation’s biggest oil-export terminals.

Oil last week broke below the $50-a-barrel level

it had held above since the Organisation of

Petroleum Exporting Countries (Opec) and 11

other nations started trimming supply on Jan. 1.

US crude stockpiles have climbed to a record and

production surged to the highest in more than a

year, while Saudi Arabia’s Oil Minister Khalid

Al-Falih said global supplies are falling slower

than expected. Rising US output is the "main

threat” to the global output deal, according to

Russia’s largest producer.

Muscat: Oman Oil Company Exploration and

Production LLC (OOCEP), a subsidiary of the

Oman Oil Company, has been named the fastest-

growing oil company in the Middle East since

2015, by Wood Mackenzie—a global leader in

commercial intelligence for the energy, metals,

and mining industries.

OOCEP earned this recognition after seeing its

net production significantly jump since 2015 to

57,000 barrels of oil equivalent per day (boepd).

In the last three years, OOCEP has grown its

production and profitability significantly

through the successful start of production from

the Block 60 and Musandam Gas Plant operated

assets, as well as a number of other new joint

ventures in Oman. As a result, by the end of 2016,

the entitlement production of the company had

grown from 33,000 to 57,000 boepd, and is

expected to double again by 2020 as the Khazzan

project ramps up.

Muscat: As many as half of the businesses said

they have not started any preparation for the

proposed introduction of value added tax (VAT)

in the Gulf region, according to a survey

conducted by Ernst & Young.

Only 11 per cent of respondents reported that

they had evaluated the changes that are needed to

their financial, operational and information

technology processes (enterprise resource

planning systems). Clearly, for many businesses

in the Gulf Cooperation Council (GCC) region

the time to get started is now.

Although communication about the timeline for

VAT implementation and details of the

framework have been delayed, January 2018 is

the stated target date and the underlying VAT

principles are based on VAT regimes adopted in

countries, such as Singapore and Malaysia, and

overlaid with the European Union’s reverse

charge principles to deal with intra-GCC trade.

Any further delays in issuing country specific

VAT laws will not prevent companies from

preparing for VAT in the GCC region.

Companies need to address contractual, financial

and technology considerations well in advance

of the VAT introduction. VAT implementation

challenges include finance and administration

issues, such as cash flow, VAT refunds, input tax

recovery, tax payments and accounting periods,

imported services, information technology

issues, such as system changes, system

replacement, compliance, audit ability and tax

engines.

Companies have to address procurement issues,

such as multiple transaction types, vendor

registrations and preferential treatment.

By Samuel Kutty — MUSCAT: March 14 –

While the Sultanate has prioritised tourism and

hospitality sector as one of the major means to

generate jobs for nationals, availability of skilled

workforce is becoming a challenge. According to

reports from the sector, the demand for trained

Omanis is high thanks to the opening of new

properties by major international hotel chains.

But experts involved in training Omani students

for the tourism and hospitality sector say the

demand is unmet for several reasons. “The

shortage is happening mainly due to non-

availability of sufficient funding for vocational

training. This deters students from joining

training programmes to become eligible for the

jobs,” said an official of a company.

In a study on the future of tourism in Oman, two

scholars in Sultan Qaboos University, opined

that the Omanisation drive in the sector has met

with limited success due to gaps such as lack of

interest in joining the sector, shortage of skilled

Muscat: Luxury rooms in Oman will not suffer

from a squeeze this summer, senior officials in

the hospitality industry told the Times of Oman.

However, this would mean that some tourists can

explore far flung places, such as Salalah and

Masirah.

Florian Wessel, director of revenue, Sheraton

Oman Hotel, said: “Summer is generally a low

season with regards to occupancy. Many

properties tend to schedule renovation around

this period. There has been a steady growth in the

hospitality and tourism sector; however a recent

increase in room supply has forced properties to

maintain low room rates to ensure sustainability.

“A couple of properties shutting down for

renovation will not have a drastic impact. The oil

crisis within the region has not helped our cause

either. However, in the long run what will define

our sales is the quality of our service and

product.”

The same was echoed by Stefan Radstrom,

general manager for the Grand Hyatt Hotel.

“Oman’s tourism will not be severely affected by

the renovations across hotels, because the peak

tourist period is from October to April, and there

are many new hotels coming up, such as the

Kempinski Hotel at the Wave Muscat, which

should be ready to welcome tourists later this

year.”

Cluster General Manager Nuno Neves for Park

Inn Muscat and Park Inn Duqm, said: “Not really,

because we have other “luxury” products in the

market, like our sister hotel Hormuz Grand

Hotel, part of our luxury product of Rezidor

Hotels. Also, the Shangri-la Hotel will continue

its path of consistency on this level.”

US sanctions that still scare banks off Iranian

business, four Iranian and two Western sources

said.

Islamic Republic of Iran Shipping Lines (IRISL)

was removed from international sanctions

blacklists last year and after years of isolation

aims to raise funds to modernise its fleet. It has

already placed an order for new ships estimated

to be worth $626 million.

A floatation on the LSE would make it the first

Iranian company to list on Britain's main

exchange since the Islamic revolution in 1979.

But the difficulty in achieving such a landmark

shows how far Tehran still remains from its goal

of integrating fully with the global economic

mainstream, since its 2015 deal with world

powers to lift international sanctions in return for

curbs on its nuclear programme.

President Hassan Rouhani, who faces a

campaign for re-election in May, has struggled so

far to demonstrate to voters real economic

benefits from the deal. He won office in a

landslide in 2013 on a promise to reduce Iran's

isolation, and the nuclear deal is his crowning

achievement.

Omani staff especially with regards to language

skills in the tourism industry in general and tour

guidance specifically. National Hospitality

Institute, which is a leading provider of quality

vocational training for hospitality, catering and

travel sectors, in its annual report pointed out that

for the first four-month period in 2016, only 42

new trainees were sent to the company in spite of

employers requisitioning training for 274

identified jobs for this period.

According to Al Kharusi, sustainability equates

not only to energy savings or environment but

encompasses an approach that envelopes people,

planet and profit.

Muscat: Galfar Engineering & Contracting

Company on Tuesday said that the group’s

consolidated losses have been revised to

OMR10.82 million for 2016, after adjusting an

additional impairment of receivables of

OMR4.5 million and investment of OMR2

million for another associate company in India.

This was assessed by the auditors in line with

IFRS provisions, according to a disclosure

statement posted on MSM website.

This is also against a loss of OMR28.86 million

in 2015.The company’s total revenue stood at

OMR340.88 mil l ion in 2016, agains t

OMR345.23 million in the previous year. The

conso l ida t ed expenses a l so s tood a t

OMR339.91 mil l ion in 2016, agains t

OMR342.96 million for the previous year.

London/Ankara: Iran's top cargo shipping

company has held meetings in London to

discuss a possible listing on the London Stock

Exchange (LSE), but has so far been thwarted by

Muscat: Oman government’s disinvestment of

49 per cent stake in state-owned Muscat

Electricity Distribution Company (MEDC) by

way of an initial public offering (IPO) is

expected before June this year, a top-level

official at the Capital Market Authority (CMA)

told the Times of Oman.

“We are in discussion with the issue manager

and it is in the process. We hope to see the issue

before the end of the first half of this year. That is

what we are hearing from the Ministry of

Finance,” said Sheikh Abdullah bin Salim Al

Salmi, executive president of CMA. The state-

owned electricity firm has already submitted its

prospectus for the share offer.

Al Salmi further said the size of the issue and

offer price have not been decided yet since the

issue manager has to complete valuations.

Discussions are also on to take a final decision

on whether to reserve a certain portion of the

issue for institutional investors (such as Oman

Telecommunication Company’s share offer few

years ago) or offload the whole issue in favour of

the investing public. “A decision is yet to be

taken.”


Oman plans to

organise a major

investment forum

Oman refiner hires

Credit Agricole for

$6b project

Muscat: Oman will be organising a major

investment forum—the Oman International

F o r u m o n B u s i n e s s a n d I n v e s t m e n t

Opportunities—towards the end of April or in the

first week of May.

The Ministry of Commerce and Industry in

cooperation with various companies will

organise the forum, said Mohsin Khamis Al

Balushi, advisor at the Ministry of Commerce

and Industry said.

The ministry is expecting large participation

from the Gulf Cooperation Council and Europe.

D u b a i : O m a n ’s D u q m R e f i n e r y &

Petrochemical Co. hired Credit Agricole SA to

advise on fundraising for its $6 billion project,

according to two people with knowledge of the

plan.

Credit Agricole will help the Omani company

raise more than $2 billion in loans, said the

people, who asked not to be identified because

the information is not public. Funding backed by

export credit agencies and a sale of bonds may

also be considered to support the project, the

people said.

The Duqm refinery project is 50 per cent owned

by state-controlled Oman Oil Co, with the other

50 per cent held by Kuwait Petroleum

International, a unit of government-owned

Kuwait Petroleum Corp. The project involves

building a 230,000-barrel-a-day refinery in the

Duqm Special Economic Zone on the Arabian

Sea coast. Spokesmen for Oman Oil and Credit

Agricole did not respond to requests for

comment. Oman is pushing ahead with projects

to diversify its economy even as low oil prices

hurt its finances.

State-owned Electricity Holding Co. last month

hired JPMorgan Chase & Co. and Bank Muscat

to advise on raising $2 billion for projects, while

Bank Muscat and Standard Chartered Plc are

said to be helping Oman Oil raise about $1.4

billion from two loans for its liquefied

petroleum gas and methanol businesses.

Muscat IT Eng. & Trd. LLC

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Orpic plans

strategic fuel

reserves in the

Sultanate

Back2Business

attracts high-

profile turnout

By Conrad Prabhu — MUSCAT: MARCH 11 –

O r p i c , t h e S u l t a n a t e ’s r e f i n i n g a n d

petrochemicals flagship, is planning to establish

fuel depots at strategic locations in the country,

according to a top official of the wholly state-

owned company. Ahmed al Jahdhami (pictured),

Chief Executive Officer, said one such strategic

fuel reserve is planned at Al Jifnain (just outside

Muscat Governorate) where Orpic Logistics

LLC, the partnership of Orpic and Spanish fuel

transportation and storage specialist Compañía

Logística de Hidrocarburos (CLH), is building a

major fuel storage and distribution terminal.

“We are working with the government on our

project called ‘strategic reserves’ in Al Jifnain

and other areas,” Al Jahdhami said. The official

made the revelation at the Oman & Italy

Business Forum 2017, which was held last

Wednesday to spotlight opportunities for In-

Country Value (ICV) development linked to the

implementation of part of Orpic’s mammoth

$6.4 billion Liwa Plastics Industrial Complex

(LPIC) at Suhar. The event showcased, among

other things, opportunities associated with

I ta l ian-based technology giant Maire

Tecnimont’s $888 million contract for the

execution of Package 2 of the LPIC project,

covering the construction of polyethylene and

polypropylene plants.

In his presentation — his first public

engagement since taking over as Orpic CEO

with effect from January 1, 2017 — Al Jahdhami

said the Muscat-Suhar Product Pipeline project,

which includes the centrepiece Al Jifnain

Terminal, is due for completion this year.

AL DUQM: The Governorate of Al Wusta is

famous for its marine wealth. The governorate is

rich with different types of Omani fish like

shrimps, abalone, kingfish, emperor, groupper

and seabream due to the long coastline as the

governorate overlooks the Arabian Sea and is

considered a key asset to the Omani economy in

fish production internally and externally. Many

residents of the governorate work in fishing and

the associated professions, including fish

transport, sale, and trade. The Department of

Fisheries in the governorate plays an important

role in organising fish put-up in the market and

the implementation of many projects for the

development of the fisheries sector.

Khalid bin Hamad al Hadabi, Director of the

Department of Fisheries, in the Governorate of

Al Wusta said that shrimp traps control project

was completed over the past year where it

achieved positive results during operation,

including preserving the shrimp stocks and

regulating fishing with the licensed fishing gear,

as well as creating self-censorship among the

fishermen to maintain this stock, noting that the

cost of this project stood at RO 109,000.

He added that Fishermen Complex in Ras

Madrakah in the Wilayat of Al Duqm was

completed and it attracts more than 200

fishermen and workers in the fisheries sector

from other regions, adding that the project aims

at reducing expat labour and encouraging Omani

fisherman to work and maintain the fishing

profession.

New projects set

to ramp up flour

milling capacity

COMEX 2017 to

focus on fostering

digital

connections

Back2Business 2017 proved that the initiative

has grown from strength to strength, with over

350 guests attending yesterday’s event hosted by

the Grand Hyatt Muscat. “It is always a great

pleasure doing this event. The business

chambers involved have worked very hard for

the last eight months, and tonight we

experienced the excellent result of their great

efforts,” Stefan Radstrom, General Manager,

Grand Hyatt Muscat.

Guests included influential personnel and

dignitaries who eagerly networked with

businesspersons from across a multitude of

sectors. “It’s an occasion where useful,

insightful dialogue can be exchanged, whether

you are an employee, an SME or a global

corporation,” said Eva Stanley-Jones, Event

Organiser.

By Business Reporter — MUSCAT: MARCH

11 – O m a n ’s i n t e r n a t i o n a l b u s i n e s s

communities came together to tackle the topic of

‘Challenge’ at this year’s Back2Business,

Oman’s Largest Business Networking Event,

sponsored by the Bank of Beirut Oman.

Together with The Oman American Business

Centre, the British Business Forum, the

European Business Persons Group and the

Australian Business Group Oman, the evening

presented an opportunity to network, mingle and

connect within spectacular surroundings.

MUSCAT: The 27th edition of Oman’s

prominent event for IT, Telecom & Technology,

COMEX, will take place from March 28 to April

1, 2017 at the Oman Convention & Exhibition

Centre. This seminal ICT event is held in

collaboration with Smart City Summit-Oman

being held for the first time in Oman with

strategic partnership of the Smart Cities Council

and the Information Technology Authority

(ITA) as well as Oman Broadband and Omran.

The theme of COMEX this year will centre on

‘to digital life” that impact the future of both

business and personal spheres.“ICT is breaking

new grounds in terms of economic & social

transformation, creating new networks and

connections within both the public and private

sectors. Access to services, enhancing

c o n n e c t i v i t y a n d c r e a t i n g b u s i n e s s

opportunities, ICT plays a pivotal role in

bringing individuals and organisations together.

This year, COMEX focuses the spotlight on

Oman’s digital society, uniting stakeholders

from all walks of life involved in creating and

developing the new digital economy” inputs Mr

Tarek Ali, General Manager, OITE Trade Fairs.


A proliferation of flour mills in the Sultanate is

set to boost flour production capacity to 3,800

metric tonnes (MT) per day, representing nearly

a doubling of capacity from 2015 when Oman

had only two plants — Oman Flour Mills in

Muscat and Salalah Flour Mills in Dhofar

Governorate. The dramatic increase in milling

capacity, while boding well for the nation’s food

security objectives, is expected to accelerate

already fierce competition in the domestic

market.

According to Salalah Flour Mills, currently the

nation’s largest miller with a daily milling

capacity of 1,500 MT, two new mills have set up

operations in Salalah over the past two years. Al

Raseed Flour Mill and Al Reef Flour Mill, with a

capacity of 200 MT and 300 MT respectively,

have come on stream at Raysut Industrial Estate.

In addition, a fifth plant — Al Khajeej Flour Mill

— is preparing to launch operations with a

capacity of 500 MT per day at Suhar Industrial

Estate during the current quarter. Also on the

anvil is the government-backed Suhar Flour

Mill, currently under construction at Suhar Port

with a capacity of 500 MT.


Money lost on

property tax

evasion

Fisheries sector in

Al Wusta is key

asset to economy

By Samuel Kutty — MUSCAT: MARCH 11 –

Muscat Municipality plans to clamp down on

those who evade tax on rents for residential and

commercial properties. A civic official told

Observer that several cases of non-compliance

with payment of tax for tenancy agreements

have been detected and, in some cases actions

initiated against offenders. While many

landlords even do not sign agreement in

connivance with the tenants, several others

undervalue the property to bunk off taxes fixed

by the municipality.

“By doing so both the owner and tenant stand to

profit from this kind of a deal, while it deprives

the municipal coffer of thousands of rials every

year”, said the official who did not want to be

named.

Moreover, the municipality tax that has been

mentioned in the provisions of the Royal Decree

No (6/98) is a governmental debt to be paid by

the landlords or tenants as per the agreement and

can be collected by the administrative

confiscation.

According to Salim Mohammed al Ghamary, a

Muscat Municipality Council member, the civic

body loses a large sum of amount every year by

way of tax evasion.

“Many of the property owners in Muscat do not

register rent lease agreements to evade taxes.

The municipality should impose heftier

penalties for those violating the rule, not just

fines”, he said.

Unless the lease agreement is registered and the

prescribed fees are paid, such agreement shall

not be recognised by any official authority in the

Sultanate.

New regulations

beef up consumer

protection

Omani investors

abroad told to be

vigilantBy Staff Reporter — MUSCAT: March 12 –

Oman Chamber of Commerce and Industry

(OCCI) in a statement issued on Sunday warned

Omani investors abroad to be careful before

entering into any kind of business agreements.

The chamber was responding to a report in a

regional newspaper, which said that 22 Omani

investors have been victims of a scam amounted

By Fahad Al Ghadani — MUSCAT: March 12 –

The Public Authority for Consumer Protection

(PACP) has issued executive regulations that

further strengthen consumer protection in the

Sultanate. The new guidelines, coming just over

two years since the promulgation by Royal

Decree of the Consumer Protection Law, will

come into force today (March 13). The new

regulations seek to address all the shortcomings

in the Consumer Protection Law. For example, it

deems a product as adulterated if it contains

foreign substances that may change its

composition and affect its durability. Likewise,

it mandates the printing of the requisite product

specifications on the package label as sought by

regulatory agencies in the Sultanate.

The place of origin of the product should be

furnished as well. Under the new regulations,

the sale of a consumer product is deemed illegal

if it has passed it’s expiration date, or if there are

any changes to its natural form, or labels feature

misleading information. The new regulations

guarantee the rights of consumer, including the

right to access information of the commodities

being purchased or used, or the services

received. The new regulations also affirm the

consumer’s right to return a product or get a

faulty item replaced. The consumer may return

the goods within 15 days of purchase or delivery.

Furthermore, the regulations upholds the

consumer’s right to be sold products and

services that respect religious values, customs

and traditions.

Penalties are toughened under the new

regulations. Prison terms ranging from one to

two years, with fines of up to RO 2,000, have

been prescribed. Actions that compromise the

safety of consumers are punishable with jail

terms ranging from 10 days to one year, with

fines extending from RO 100 to RO 2,000. The

new regulations have been enthusiastically

welcomed by the general public. Ali Khalfan, a

Over 200,000

cruise tourists

visit Oman

By Vinod Nair — MUSCAT: March 14 – A total

of 217,000 visitors arrived in Oman through

cruise ships in 2016, a growth of 47.6 per cent

compared to the previous year, as per the details

available. The cruise tourism, which started in

late November and concludes this month, has

been witnessing a steady growth over the past

few years, making it one of the fastest growing

sectors in terms of tourists visiting to the

country. On Tuesday, the ship MSC Fantasia —

owned by MSC Cruises — called at Port Sultan

Qaboos with 4,500 passengers of different

nationalities. Last week, two massive cruise

ships, Mein Schiff 3 and Vision of the Seas, with

over 6,000 passengers had called at Muscat, to

add to the claims that 2016-17 season has been

one of the dynamic for Oman in terms of the

growth of cruise tourism. Meanwhile, the hotel

revenues (three to five star categories) increased

by 2.3 per cent to 17 million in January 2017,

compared to the same period a year ago. Visitors

from Europe top the occupants followed by the

number of Omanis.

Construction work on the Mall of Oman — a

super-regional retail destination — has

commenced at Bausher in Muscat Governorate.

Majid Al Futtaim Holding (MAF), a leading

developer, owner and operator of shopping

malls, hotels and mixed-use communities in the

Middle East and North Africa, is developing the

SMC awards SNC-

Lavalin contract

for ammonia plant

construction

GCC hospitality

market records

lower RevPAR in

Jan

By Business Reporter — MUSCAT: MARCH

12 – The majority of the hospitality market

across the Middle East witnessed a decrease in

KPIs in January 2017 when compared to the

same month last year, according to Yousef

Wahbah, MENA Head of Transaction Real

Estate at EY. In the GCC, all markets except

Kuwait recorded lower revenue per average

room (RevPAR), reflecting the slowdown in

performance witnessed across the wider MENA

region, he stated in the January 2017 MENA

Hotel Benchmark Survey Report.

Dubai’s hospitality market emerged as the top

MENA performer in January 2017, representing

the highest occupancy at 85.7 per cent and

highest RevPAR of $246, over three times the

average RevPAR recorded in other MENA

cities. Dubai beach hotels had the highest

RevPAR of $343, while city-based hotels in

Dubai recorded the highest occupancy at 87.6

per cent.

Despite the influx of new hotels, Dubai has

managed to sustain extremely high occupancy

levels year on year. However, average room

rates and RevPAR dropped 8.1 per cent and 7.3

per cent percentage points (pp) respectively in

January, which could be a result of an

oversupply of rooms, encouraging the sector as a

whole to lower room rates to remain

competitive.

Abu Dhabi’s hospitality market maintained a

strong occupancy of 77 per cent in January 2017,

but witnessed a decrease in RevPAR and ADR of

11.8 per cent and 10.6 per cent when compared

to the period last year, EY’s report said.

Cairo’s hospitality market saw an immense

growth across all KPIS in January 2017,

witnessing the highest growth in RevPAR of 160

per cent at $64, up from $24 in January 2016,

due to higher occupancy and room rates.

By Business Reporter — MUSCAT: MARCH 12

– Salalah Methanol Company (SMC), a wholly

owned subsidiary of Oman Oil Company

(OOC), has awarded SNC-Lavalin, a contract for

the engineering, procurement and construction

(EPC) of a 1,000 metric tonnes per day

anhydrous liquid ammonia plant, including its

utilities and off-site infrastructure, in Salalah

Free Zone. This vital project is in line with the

economic diversification of the Sultanate, and as

part of the company’s growth strategy with the

aim of contributing to value creation. Setting up

the ammonia plant is considered an important

milestone for high value-added petrochemical

industries.

The project works will begin in March, SNC-

Lavalin will be responsible for the engineering,

procurement, construction and commissioning

of the facility, which will produce anhydrous

liquid ammonia. The completion of Refinancing

by SMC is expected to occur in the second

quarter of 2017, and the plant construction will

be completed in three years. The ammonia plant

would be utilising the methanol plant’s hydrogen

rich by-product gas as feedstock. The plant was

designed by Linde AG of Germany using Haldor

Topsoe license of Denmark for ammonia

synthesis production. The design complies with

local environmental regulations. The project will

also harness in-country value with strong focus

on the development of local resources and

engaging local supply chain.

This project paves the way for future

opportunities in Oman for the development of

downstream industries and thus, maximising the

va lue add i t ion . Ammonia con t r ibu tes

significantly to the nutritional needs of terrestrial

organisms by serving as a precursor to food and

fertilizers.

Oman ranks high

in medical tourism

By Samuel Kutty — MUSCAT: March 13 – The

Sultanate of Oman has been ranked 35th in the

global Medical Tourism Index (MTI) for its

expanded access to healthcare and consumer

experience. It has been placed seventh and fifth

among Arab nations for its overall high

performance and country environment

dimension, respectively. The ranking for its

medical tourism industry and the facility and

service quality dimensions are both in eighth

position in the region. The MTI is a worldwide

reference point unveiled by International

Healthcare Research Center (IHRC), which

considers destination environment, medical

tourism and quality of services and facilities for

ranking.“It is Oman’s cost advantage for

healthcare over the neighbouring nations that

allows the country to better compete, while still

having to pay attention to sub-dimensions that

will help them achieve greater results and

increase medical tourism business,” IHRC said

in its 2016 ranking report. According to IHRC,

Oman managed to receive more than two

million visitors to the country last year, and is

working on rehabilitating its historic venues and

developing better infrastructure around them to

increase its appeal. “The country still needs to

work on attracting more visitors as well as

working to boost the quality of its hospitals and

its international accreditations,” the report

points out.The MTI measures the attractiveness

of a country as a medical tourism destination in

t e r m s o f o v e r a l l c o u n t r y i m a g e a n d

envi ronment ; hea l thcare and tour i sm

at t ract iveness and infrastructure; and

availability and quality of medical facilities and

services. “Public healthcare is perceived as

being of high quality for a middle income

country, which makes the quality of the private

sector high and gives them an opportunity to be

able to compete in the medical tourism industry

for incoming patients,” the report adds. Medical

tourism is one alternative that patients pursue

typically to get cheaper or more advanced

treatments not offered in their home country.

Ten sectors to be

prioritised: Oman

Global Logistics

JV begins work on

$450m Mall of

Oman

MUSCAT, MARCH 13 –

Oman Global Logistics Group (OGL), the

transport and logistics arm of the Omani

government, has prioritised 10 different sectors

that, suitably developed and leveraged, have the

potential to make a significant contribution to

the strategic goal of supporting the growth of a

logistics-centric economy in the Sultanate.

Of the 10 target areas, five of them — Mining,

Fisheries, Chemicals, Food Processing and

Agriculture — are essentially production sectors

with the potential to generate sizeable volumes

for export. The remaining five thrust areas —

Retail & FMCG, Automotive, E-commerce,

Pharmaceuticals, and Oil & Gas — that are ideal

as hubs or distribution centres with the potential

to fuel the growth of logistics activities in the

Sultanate.The initiative is an integral part of the

National Logistics Strategy currently being

implemented by OGL on behalf of the Omani

government, according to a senior official of the

state-owned grouping of the government’s

investments in various ports, free zones,

logistics hubs, and transport entities.Elements of

OGL’s implementation strategy and the

potential for logistics-related investment

opportunities were outlined by Ahmed Said

Tabook, Programme Director — Markets,

Oman Global Logistics Group, at a key forum

held in the city last week.Also as part of the

National Logistics Strategy, OGL is working to

formulate a national markets development plan

to help achieve the short, medium and long-term

ambitions and targets set out in the national

logistics roadmap, said Tabook.Notable are

government’s ambitions to lift the logistics

sector’s contribution to the GDP to RO 3 billion

by 2020, RO 8 billion by 2030 and RO 14 billion

by 2040. It also envisions the growth of air cargo

to 0.35 million tonnes by 2020, rising to 0.75

million tonnes by 2030 and 1.5 million tonnes by

2040.


Oman eyes RO 17

billion

investments in 3

sectors

to nearly RO 450,000. The chamber said the

investors should seek help from legal authorities

to ensure the validity of all documents. As per

the original report, a man posing as a UAE-

based property developer proved to be a con

artist after collecting RO 450,000 from 22

Omani investors as deposits for three-bedroom

flats in Dubai. The newspaper report said that

the fraudster claimed to be a partner with a

member of an influential family when they met


Oman’s government is targeting investment

inflows totalling in excess of RO 17 billion into

three key economic sectors — manufacturing,

tourism and logistics — over the next 4 – 5 years,

according to a high-ranking official of the

Supreme Council for Planning. Talal al Rahbi,

Deputy Secretary General, said the three sectors

are at the heart of a strategic initiative

spearheaded by the National Programme for

Enhanc ing Economic Divers i f i ca t ion

(Tanfeedh) to accelerate economic development

through the pursuit of promising non-

hydrocarbon activities.

Speaking at a forum held in the city last week, Al

Rahbi said the three sectors in question have

been singled out from a total of 19 sectors that

have been identified for investment and

development during the current 9th Five Year

Plan (2016-2020). Total investment envisaged

in the 19 sectors is projected at RO 42 billion

over the duration of the Plan, he noted. “With

regard to Tanfeedh, we are clear in terms of the

direction we want to take, the investment we

want to achieve, and so. Investors will also know

who to talk to, and how to start the dialogue with

the people responsible for the (Tanfeedh

projects and initiatives),” the official said.

Opportunities

Galore

State Council

okays proposal to

amend economic

law

UK fisheries

centre to set up

office in Muscat

MUSCAT: The State Council session on

Wednesday, examined and approved the

proposal on its study of the Education and

Research Committee titled ‘Revising the

Duplication of Programmes and Majors at

Higher Education Institutions’.

It also gave assent to the proposal by the

Economic Committee to amend the economic

development law issued by the Royal Decree No

9/75.

The State Council Chairman, Dr Yahya bin

Mahfoudh al Mantheri chaired the session in the

presence of the honourable council members

and the Secretary-General of the Council.

The approval for the proposal on the study of the

Education and Research Committee titled

‘Revising the Duplication of Programmes and

Majors at Higher Education Institutions’ came

following the intensive discussions at the

council session. It was decided to institute a

committee to incorporate the observations of the

members.

955978The decision came after Dr Abdullah bin

Mubarak al Shanfari, Head of the Committee,

highlighted the efforts and initiatives made by

the committee, which included hosting officials

from the Ministry of Higher Education, Sultan

Qaboos University and the Ministry of

Manpower.

Investments 2020.

The great FDI potential covers various sectors

like the ambitious Oman Rail, power generation

and transmission, desalination, logistics,

petrochemicals, tourism and mining.

Around $15 billion investments are expected in

Oman Rail in nine segments covering 12,000 km

of rails, 10 million sleepers, 46 stations, eight

maintenance yards and 40 million fastenings,

while power generation and desalination are

expected to have $6 billion in investments, as

transmission is expecting $1 billion in

investments. This includes 2,500 MW solar

power as well as 500 MW of wind power.

“Logistics is expected to generate roughly $4.2

billion investments by 2020, which include

Khazaen 95 km2, GCC land connectivity, and

Salalah Port expansion,” Shahswar added.

Tourism, on the other hand, is poised to attract

$1.8 billion investment by 2020 by way of ITC,

leisure and hotels, while petrochemical

industries are expecting a whopping $10.5

billion investments by 2020 in three major areas

besides petrochemical, metal, non-metal and

food sectors.

MUSCAT: As part of 3-year UK-Gulf Marine

Environmental Sciences Programme, a team of

scientists from UK government’s Centre for

Environment, Fisheries and Aquaculture

Sciences (CEFAS) visited the Ministry of

Agriculture and Fisheries. Dr Lubna al Kharusi,

Director-General of Fisheries Research,

welcomed the team and discussed the visiting

agenda which includes training of researchers

and research assistants. She stated that the aim of

UK-Gulf Marine Environmental Sciences

Programme is to provide technical advice,

training and capacity development for the

ministry staff.

In their turn, CEFAS are presenting the findings

of the review of Oman’s capacity for the

management of aquatic diseases in aquaculture

and discussing plans for long-term development

of the ministry’s capacity to manage disease in

aquaculture. During the visit, CEFAS will

provide the ministry staff with training and

t echn ica l adv ice re la ted to f i she r ies

management, aquatic disease control and

fisheries stock assessment techniques. For

example, 2-day workshop on using R-language

software environment, which is a widely used

statistical programme, is undertaken at the

Aquaculture Centre. This cooperation will

ultimately support the ministry to manage a

sustainable and productive fishing and

aquaculture industry to gain the full benefits

from Oman’s large marine resources.

By Kabeer Yousuf — MUSCAT: March 15 –

With a plethora of infrastructure, tourism

projects currently under way complemented by

highly strategic and socio-economic edges, the

Sultanate is haven for foreign investments.

A detailed presentation on various projects

where foreign investments are invited was made

at the Oman-India investment seminar cum B2B

meeting held at the Indian Embassy premises to

the various multi-national companies attending

the Big Show Expo being held in the country.

“In less than two hours from the major business

centres of Asia and fast sailing times to Asia,

Africa, Europe and North America, Oman’s

investment potential is rather high,” Shahswar G

al Balushi , CEO of Oman Socie ty of

Contractors, said in his talk on Oman

signature project.

Recently, the Dubai-based conglomerate named

the joint venture of Shapoorji Pallonji Middle

East and Consolidated Contractors Company

Oman (SP-CCC) as the main contractor for the

implementation of the Mall of Oman. The value

of the contract, which was keenly contested by a

number of leading construction firms in the

Sultanate, is estimated at $450 million.

Initial enabling works, representing Phase 1 of

the project, are being undertaken by local Omani

firm Sarooj Construction. Besides major

earthworks and utility diversions, the contract

a lso enta i l s the cons t ruct ion of road

infrastructure providing access to the site just off

Muscat Expressway.

The SP-CCC joint venture has been given a

three-year timeframe to deliver its contract.

When completed by 2020, the sprawling facility

— which is expected to be the biggest shopping

destination of its kind in the Sultanate — will

host an estimated 350 outlets set on a retail space

of over 135,000 sq metres. Major attractions are

expected to include a giant snow park, VOX

Cinemas complex, and the nation’s largest store

of the Abercrombie & Fitch apparel and lifestyle

brand.



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Call to plug grads

skill gap

Private players to

power 1b-rial

Duqm rail corridor

MUSCAT

The Sultanate needs to take concrete measures

to improve the employability of its fresh

graduates and diploma holders to suit the labour

market demand, say experts.

Such steps are necessary to put Omanisation

programme on fast track, they told Oman

Tribune.

A number of experts this paper spoke to said that

institutes of higher education had already started

taking several measures to prepare young

graduates for this to help them tap the

opportunities being thrown up by a diversifying

economy.

Their courses are being redesigned to impart

skills relevant to the work environment. This

should help national graduates beat competition

and meet growing expectations of industry.

According to latest statistics, there were over

20,800 graduates aspiring for jobs at the end of

2016.

Assistant Dean of Training and Community

The ‘Invest Easy’ Portal has received 8,921

transactions in the Commerce and Industry

Department in Sur, Governorate of South Al

Sharqiyah, data from Ministry of Commerce

and Industry show.

Among these 8,339 were completed, 323

Service at the College of Engineering in Sultan

Qaboos University Ghazi Ali Al Rawas said,

“The quality of internship training for

undergraduate students makes a difference and

we can see students become confident after this

programme”.

updated, 164 were cancelled for lack of required

conditions, 92 held for payment, two were

rejected and one application was under

verification procedures.

These transactions included the mortgage

cancellation, business addition and transfer,

renewal of business records, renewal of the

commercial agency registration, cancellation of

industrial licencing, registration of mortgage for

commercial facility, registration of commercial

agency, and cancellat ion of industr ial

registration.

MUSCAT

The Sultanate is scouting for private players to

develop the 1 billion rial rail corridor connecting

Dhofar mining areas with Duqm port.

Oman Global Logistics Group, the infrastructure

holding company of the government, is in talks

with private sector mining companies to set up

the 350km rail link jointly, a top official told

Oman Tribune on Tuesday.

“If a private party wishes to jointly develop the

rail lines, we are happy to talk,” CEO of the

company Abdulrahman Al Hatmi said.

The rail line will connect mining areas of Al

Shuwaymiyah and Manji in Dhofar with Duqm

port.

Al Hatmi said the authorities were working with

companies in the mining sector to develop a joint

plan to transport limestone from Manji and

gypsum from Shuwaymiyah to Duqm port.

These sections would become the first for the

Oman national rail network, unless the plan to

develop an integrated rail network among Gulf

Cooperation Council states progresses, he said

on the sidelines of Business-to-Business meeting

organised by the Indian Embassy for visiting

businessmen from India and their Omani

counterparts.

The preliminary design of the rail network done

Muscat third best

Arab city in quality

of life

Fed may shift

stance, move to

faster pace of rate

hikes

Oil producers

keep promise on

cut: Opec

by Italian firm Italferr, includes lines between

Shuwaymiyah and Manji to Duqm port, said Al

Hatmi.

SAN FRANCISCO/WASHINGTON

The Federal Reserve, which has struggled to

stoke inflation since the financial crisis and up

until now raised rates less frequently than it and

markets expected, may be about to hit the

accelerator on rate hikes.

On Wednesday, the US central bank is almost

universally expected to raise its benchmark

interest rates, a move that just a few weeks ago

was viewed by the markets as unlikely.

And with inflation showing signs of perking up,

Fed policymakers may signal there could be

more than the three rate rises they have forecast

for this year.

“They do not have as much room to be patient as

they did before,” said Tim Duy, an economics

professor at the University of Oregon, who

expects Fed policymakers to lift their rate

forecasts this week.

Policymakers have their eyes on achieving full

employment and 2-per cent inflation. The faster

the economy approaches those goals, Duy said,

the quicker the Fed will want to tighten policy to

avoid getting behind the curve.

“That’s an acceleration in the dots,” he said,

referring to forecasts published by the Fed that

show policymakers’ individual rate-hike

forecasts as dots on a chart.

The economy already appears closer to its goals

than the Fed had expected in December, the last

time it released forecasts. The jobless rate, at 4.7

per cent, is below what policymakers see as the

long-run norm, and inflation, at 1.7 per cent, is

already in the range they had expected by year

end.

Muscat was ranked the third best Arab city in

terms of quality of life, according to an

international survey.

Muscat bagged the position after Dubai and Abu

Dhabi and ahead of Doha, Tunis, Rabat and

Amman and Casablanca, according to HR

consultancy firm Mercer’s survey on the Quality

of Living Index.

Muscat was ranked 106th among 231 cities on

the world level in the index that looks at which

cities provide the best quality of life.

Vienna, Austria’s grand capital on the Danube

river, topped the list offering the highest quality

of life for the eighth year in a row, and Baghdad

was pushed to be considered the worst place to

live in.

The survey helps companies and organisations

determine compensation and hardship

allowances for international staff. It uses dozens

of criteria such as political stability, healthcare,

education, crime, recreation and transport.

Singapore was the highest ranked Asian city, at

25 while 29th-placed San Francisco was the

highest entry from the US. Top of the list in

Africa was Durban at 87.

Research gets

private push

the Petroleum Exporting Countries said in its

monthly oil report.

The oil price recovery was, however, under

threat from fresh supply as high-cost producers

in the United States started drilling again,

encouraged by the price upswing, as well as

from rising Canadian production.

An Opec oil price reference basket rose by about

two per cent to an average of $53.37 in February,

the organisation said.

“High compliance with supply adjustments by

Opec and some non-Opec producers supported

gains,” it said. In December, Opec agreed with

11 non-members, including Russia, to cut output

in the first half of this year to push prices higher.

MUSCAT

The Sultanate will rank higher on innovation

indices in the coming years, as funding for

research is expected to grow with a greater

contribution from private industry. Already

there has been a lead in renewable energy, water

treatment technology and enhanced oil

recovery.

“The good thing is that we are seeing industry

extend its hand to work closely with the

government and this will take the whole effort to

a much higher level than what we were doing

with government funding alone,” said The

Research Council Secretary General HE Dr

Hilal Al Hinai.

The Sultanate was ranked 73rd in the Global

Innovation Index 2016 and its spending on

research is less than 0.2 per cent of the Gross

Domestic Product.

Research funding the world over was scarce and

in the UK for example “they have a target of 3

per cent of GDP, but were achieving 1.6 per

cent”.

“Governments support basic research, which is a

long-term risky investment whereas a lot of

applied research is done by industry. The GCC

states are now aware of the importance of

investing in research and innovation. At the

same time industry is also sort of trying to put

more resources in this for the main reason of

profitability,” he said.

PARIS

Opec said on Tuesday oil producers had kept

their promise to cut output in accordance with a

landmark deal designed to lift petroleum prices.

As a result, prices rose in February as last year’s

accord between Opec members and some non-

members gained traction, the Organisation of


On the trail of dirty

money

Transactions

through Invest

Easy

The Sultanate’s efforts to counter money

laundering are showing results and to take this

forward, further steps are imperative to evaluate

the efficiency and effectiveness of commercial

banks in preventing the menace, according to a

financial expert.

A study conducted by Dr Abdusalam F Yahia,

economic expert at the Oman Chamber of

Commerce and Industry (OCCI), has made this

suggestion after analysing the efforts made by

the Sultanate over the past decades to fight

money laundering, including its laws and

regulations and also international conventions.

Yahia says that the practice of money

laundering, though old, had evolved with time

and uses all professional and technical means

available to achieve the ends of the launderers.

It has a negative effect on society and the

economy and it affects the stability of states. The

Sultanate has played a leading role in the fight

against money laundering and it started with the

Law of Combating Drugs and Psychotropic

Substances of 1999 which makes it a crime to

launder proceeds of illegal drug money, as well

as trafficking in narcotic drugs and psychotropic

substances.Then a special law to combat money

laundering was issued as Royal Decree 34/2002,

which expanded the scope of laundering to

include the proceeds of any crime punishable by

law. This was followed by the Law of

Combating Money Laundering and Terrorism

Financing, Royal Decree 79/2010.

$٨�٧b invested in

Mena green power

sectorGreenfield activities continue to dominate

power and utility transactions in across the

Middle East and North Africa (Mena) region,

attracting $8.7 billion of investment in 2016,

according to an Ernst and Young report.

The report ‘Power transactions and trends: 2016

review and 2017 outlook’ says mergers and

acquisitions in the renewables sector picked up

in 2016 across the region after a long period of

slow activity. Key investment announcements in

the last quarter of 2016 included the Kuwait

Fund for Arab Economic Development

coordinating a debt financing of $115.5 million

to set up a desalination plant in Egypt.

Additionally, in the UAE, consortium of lenders

including Islamic Development Bank, Natixis,

National Bank of Abu Dhabi and First Gulf Bank

invested $924 to build 800 MW Mohammed Bin

Rashid Al Maktoum Solar PV Phase III.

The UAE also saw new projects across coal,

nuclear, and solar, funded by both local and

Asian investors, to support its raised renewable

energy target from 24 per cent to 26 to help fight

climate change.

Separately, Dubai launched a $27-billion green

fund to support global sustainability projects.

MUSCAT

Stabilising oil prices, large international

sovereign debt issuances and lower credit

growth will improve funding conditions for

banks in the Gulf Cooperation Council (GCC)

over the next 12 months, according to a Moody’s

Investors Service report.

Price stabilisation between $40-$60 per barrel

wil l improve oil revenues, supporting

government and corporate deposits in the

region’s banking systems. International debt

issuance will also support deposits, while slower

economic growth will subdue lending activity

and reduce funding pressures for banks.

“Omani and Qatari banks will benefit the most

from easing funding conditions, followed by

banks in Saudi Arabia and the United Arab

Emirates,” says analyst Mik Kabeya.

“However, Bahraini and Kuwaiti banks will

continue to have the strongest funding and

liquidity profiles in the region,” he added.

The report, an update to the markets, says Omani

and Qatari banks will benefit the most from the

expected easing of liquidity, since they have

been among the least resilient to a prolonged

period of low oil prices.

Funding conditions will stabilise for banks in the

UAE which have a net loans to deposits ratio of

94 per cent as of June 2016. The funding squeeze

experienced by Saudi banks since 2015 will ease,

given the government’s payment late in 2016 of

around $28 billion of overdue contractors bills

and Moody’s expectation of low credit growth.

Islamic banks to

outpace

conventional

peers in profits

Funding pressure

on GCC banks set

to ease this year

MUSCAT

The profitability of Islamic banks in the Gulf

cooperation Council (GCC) region will outpace

that of conventional peers for the second

consecutive year in 2017, according to a rating

agency.

This is on the back of stronger margins and

resilient cost of risk. Islamic banks became

more profitable than their conventional

counterparts in 2016 after trailing for five years.

“Islamic banks will be able to maintain their

profitability in 2017, as lower funding costs will

support their margins against a backdrop of

rising interest rates, while improvements in their

risk management and asset quality will further

ease the pressure on their cost of risk,” says

analyst and Moody’s assistant vice-president

Nitish Bhojnagarwala.

The Moody’s report, `GCC Banks: Islamic

banks to maintain higher profitability than

conventional peers’, says the stronger margins

in 2017, primarily as a result of their low

funding costs, reflect their reliance on largely

stable current and savings account balances.

Islamic banks also tend to have higher asset

yields, given their focus on retail and the real

estate-related lending.

Moody’s expects that Islamic banks will retain a

margin advantage of about 40 basis points over

conventional banks in 2017. The net profit

margins are analogous to conventional bank net

interest margins.



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Date post:	14-Apr-2017
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