Logistics competitiveness set to drive Oman’s economic growth
With Oman's economy projected to continue growing, transport and logistics are expected to remain one of the leading non-hydrocarbon sources of economic growth
Oman has made remarkable progress in developing its logistics and transport infrastructure over the years. The development and expansion of key seaports, coupled with the establishment of economic and free zones, have significantly expanded Oman's prospects as a leading logistics hub and play a vital role in diversifying its economy.
The sultanate's geographical location has proven to be a valuable asset for the country. Situated along major trade routes that connect Asia, Europe, and Africa, Oman has capitalised on this strategic advantage. Substantial investments in infrastructure, including ports, airports, roads, economic and free zones, and industrial estates, have cemented Oman's position as a leading logistics hub in the region.
Oman's strategic positioning and excellent logistics and transportation infrastructure have transformed the country into a gateway to some of the world's most significant and affluent markets and improved Oman's global logistics ranking.
Oman's logistical prowess is underscored by its ranking of 43rd out of 139 nations in the World Bank's 2023 Logistics Performance Index.
Moreover, Oman achieved a notable 12th place globally in the Agility Emerging Markets Logistics Index 2023. These rankings reflects its competitiveness based on logistics strength and business fundamentals.
Logistics strategy
Oman's Logistics Strategy 2040, which was launched in 2015, serves as a blueprint for the country's ambitions in the logistics sector. The strategy sets ambitious targets, including breaking into the top 10 of the World Bank's Logistics Performance Index, creating 300,000 jobs within the logistics sector, and contributing Ro14bn ($36.4bn) to the country's GDP by 2040.
This strategy aims to elevate the logistics sector to become Oman's second-largest contributor to GDP after hydrocarbons. With Oman's economy projected to continue growing, transport and logistics are expected to remain one of the leading nonhydrocarbon sources of economic growth.
The Logistics Strategy 2040 also plans to create up to 300,000 jobs within the logistics industry. This initiative not only bolsters employment opportunities but also strengthens the sector's position as a major contributor to the nation's economy.
Ro2.5bn investment by 2025
The Ministry of Transport, Communications, and Information Technology (MTCIT) last year launched an executive programme for Oman Logistics Centre for the period 2023 to 2025.
The programme’s core objectives include economic diversification in transportation and logistics, targeting a robust increase in investments to Ro2.5bn by 2025.
Ambitious goals include boosting government revenue growth from the sector, achieving Ro18mn in returns from land transport by 2025, and increasing employment opportunities in related sectors from 19% in 2023 to 21% in 2025.
H E Said bin Hamood al Mawali, Minister of Transport, Communications, and Information Technology, earlier highlighted the sector’s rapid growth, noting its contribution to Oman’s GDP in 2022 was approximately Ro2bn. He envisions the logistics sector becoming the secondlargest contributor to Oman’s economy by 2040.
Asyad: The driving force
As a government company, Asyad Group plays a pivotal role in Oman's logistics landscape. Established in 2016, Asyad Group has been at the forefront of the nation's logistics transformation. Leveraging its status as the sultanate's flagship global integrated logistics provider, Asyad Group is actively working to connect Oman's ports and zones with the world.
In 2022, Asyad Group's efforts paid off as the major ports of Salalah, Sohar, and Duqm collectively achieved an impressive growth rate of 8%. They handled over 62.3mn tonnes of general cargo, representing a 10% increase compared to the previous year.
This success demonstrates the Asyad Group's commitment to developing a world-class integrated logistics network that adheres to the highest international standards of operational efficiency.
Oman's journey towards becoming a global logistics hub is marked by remarkable achievements and ambitious plans. Its strategic location, coupled with significant investments in infrastructure and a forward-looking Logistics Strategy 2040, has set the stage for unprecedented economic diversification and growth.