Oman's infrastructure projects are driving spending in the construction sector, aided by favourable regulations in the sultanate that incentivise foreign investment
Oman’s construction sector has continued to record robust growth and is “easily” outpacing the MENA construction sector average, according to a new report from BMI Research.
According to BMI, this performance will continue over the course of the next five years due to favourable regulations in the sultanate that incentivise foreign investment, as well as an ambitious economic diversification agenda, robust government support for infrastructure sectors like renewables, water and logistics.
The report outlined a number of infrastructure projects driving the sector’s growth, including a $155 million contract awarded by the Oman Power and Water Procurement Company to a consortium involving ACWA Power and Veolia Middle East to set up the Salalah independent water project in Dhofar.
Other infrastructure projects highlighted by BMI include a proposed new port near Sur Industrial Estate in Al Sharqia, for which a feasibility study is expected to be submitted later in H1 2018.
“Investment into port infrastructure will form an increasingly important means of facilitating economic diversification in GCC countries over the coming years, as they seek to mitigate the effects of low hydrocarbon prices and boost their appeal as logistical and trading hubs,” the report said.
“We expect this trend to be particularly salient in Oman, as the government looks to capitalise on the country’s favourable geographic location.”
Additionally, the report noted that special economic zones will likely serve as an investment focus for companies seeking to increase their exposure to Oman’s infrastructure sector, as will tourism-related projects.