Overview
Physical infrastructure underpinning Oman’s manufacturing sector spans transport networks, utilities, industrial zones, and specialised facilities. The government has committed significant capital to infrastructure development, with the national infrastructure pipeline valued at over USD 50 billion across all sectors. For manufacturing specifically, infrastructure investment of USD 12 billion in active and pipeline projects targets capacity expansion, connectivity improvement, and modernisation of existing assets.
Key Indicators
| Infrastructure Element | Current Status | 2040 Plan |
|---|---|---|
| GDP Contribution | ~9% | 15%+ by 2040 |
| Aluminium Output | 390,000 tonnes/yr | 500,000+ tonnes/yr |
| Omanisation Rate | ~38% | 50%+ by 2040 |
Analysis
Infrastructure quality and availability significantly determine the competitiveness of Oman’s manufacturing sector. The Sultanate’s geographic advantages (3,165 km coastline, strategic location between Asia and Africa) are leveraged through purpose-built infrastructure. Sohar Aluminium, Raysut Cement, OQ, Oman Cables, A’Saffa Foods benefit from dedicated industrial zones, port access, and utility connections. However, infrastructure gaps persist in secondary cities and remote governorates, creating geographic disparities in sector development. The Oman Rail project (2,200 km) and road expansion programmes will enhance connectivity, while digital infrastructure (5G, fibre) enables technology-intensive operations.
Challenges
Infrastructure financing gaps, construction delays, maintenance backlogs, and geographic dispersion increase costs. High energy input costs for non-subsidised operations, limited domestic supply chains, skill shortages in advanced manufacturing, competition from Saudi and UAE mega-factories, and reliance on imported raw materials.
Opportunities
PPP models for infrastructure delivery, modular construction approaches, smart infrastructure integration, and cross-sector infrastructure sharing reduce costs and improve utilisation. Downstream aluminium value addition (extrusions, cables), food processing for regional export, pharmaceutical manufacturing (Oman Pharma), building materials for GCC mega-projects, and defence manufacturing under the IKTIFA programme.
Vision 2040 Targets
Raise manufacturing GDP share to 15 percent; double non-oil exports; create 150,000 new manufacturing jobs; achieve 50 percent Omanisation; establish Oman as a GCC advanced manufacturing hub.