Market Overview
Small and medium enterprises account for over 90% of registered businesses in Oman but contribute only 16% of GDP, indicating significant growth potential. The government’s Riyada (Public Authority for SME Development) provides incubation, financing, and mentoring services, while the Al Raffd Fund offers concessional lending.
The startup ecosystem is emerging, with technology incubators in Muscat attracting regional and international venture interest.
Investment Case
SME investment in Oman offers portfolio diversification beyond large-cap exposure, access to demographic-driven consumer growth, and potential for outsized returns in underserved market segments. Government co-investment reduces downside risk.
| Metric | Value |
|---|---|
| SMEs registered | 45,000+ |
| SME GDP contribution | 16% (target: 25% by 2030) |
| Al Raffd Fund lending | OMR 85 million deployed |
| Active incubators | 8 |
| VC deals (2024) | 22 transactions |
| Average seed round | OMR 50,000-200,000 |
Risk Factors
SME failure rates remain elevated. Exit opportunities are limited by MSX listing thresholds. Financial reporting quality varies significantly. Market size constrains scaling potential.
Entry Strategy
Angel networks and VC funds provide diversified SME exposure. Co-investment with Al Raffd Fund reduces risk. Sector focus on technology, food services, and logistics captures strongest growth dynamics. Mentorship involvement improves outcomes.
Vision 2040 Alignment
SME development is a central Vision 2040 priority, with targets to increase the sector’s GDP contribution to 25% by 2030. Dedicated government programmes, procurement preferences, and financing facilities create a supportive ecosystem.