It is the Gulf State (Sultanate) that makes the least headlines, economically that is. Yet Oman harbors unsuspected potential, making it a soft power that benefits its people first and foremost, but also the entire commercial architecture of the Gulf.
It was no doubt with this in mind that a Tunisian-Omani business forum was held in Tunis, with the aim of strengthening economic and commercial cooperation between the two countries and exploring investment opportunities in a variety of fields.
This event was part of a series of activities and reciprocal visits between officials and businessmen from the Omani Chamber of Commerce and Industry and their counterparts from the Tunisian Chamber of Commerce and Industry.
The forum included working sessions presenting investment opportunities in both Oman and Tunisia.
Representatives from the Tunisian and Omani investment authorities presented details of available projects and the procedures in place to facilitate investment. Bilateral meetings were organized between businessmen to discuss opportunities for collaboration and to exchange knowledge.
Speaking at the event, Samir Abid, Minister of Commerce and Export Development, stressed the importance of strengthening trade relations between Oman and Tunisia.
He highlighted Tunisia’s promising investment opportunities in areas such as renewable energy, information technology, food processing and tourism. He invited Omani investors to take advantage of the facilities offered by Tunisia to attract foreign investment.
For his part, the Omani Ambassador to the Republic of Tunisia, Hilal Abdullah Ali Alsanani, said that Oman hopes to strengthen cooperation with Tunisia in various fields.
He recalled the strong historical ties between the two countries and spoke of the efforts being made to encourage Tunisian companies to invest in Oman. He stressed the joint commitment to facilitate communication between businessmen and provide the necessary support to promote bilateral partnerships.
Non-hydrocarbon activities, drivers of growth
Oman’s economy will grow by 1.2% in 2023, accelerating to 1.9% in the first half of 2024. While oil production cuts under the OPEC+ agreements have limited the contribution of hydrocarbons, non-hydrocarbon sectors, including construction, manufacturing and services, have seen significant growth, reaching 3.8% over the same period. Non-hydrocarbon activities will be the main drivers of economic growth in the medium term as private sector investment materializes.
It is important to note that inflation remains low, averaging 0.6% between January and October 2024, compared with 1.0% in 2023, due to lower transport and food prices. Fiscal and external surpluses have been maintained, with a fiscal balance of 6.2% of GDP and a current account balance of 2.4% of GDP in 2024. Public debt has fallen to 35% of GDP, reflecting Oman’s commitment to fiscal responsibility.
However, the International Monetary Fund (IMF) has warned of potential downside risks, including geopolitical tensions, a global economic slowdown, particularly in China, and lower oil prices in the context of an energy market that could be oversupplied by 2025. However, factors such as higher oil prices, accelerating global growth and the success of reforms under Oman Vision 2040 could continue to support the economy.
Nevertheless, Oman’s economic outlook remains positive, underpinned by favorable hydrocarbon revenues and reform efforts. Non-hydrocarbon growth is expected to accelerate over the medium term, driven by large private sector investments and increased demand from neighboring countries.
The fiscal and current account balances are expected to remain in surplus over the medium term, albeit slightly below current levels due to lower oil prices, but supported by increased hydrocarbon production and continued fiscal discipline. However, the outlook is subject to considerable uncertainty, in particular given the volatility of oil prices, the risks of a global economic slowdown and the intensification of geopolitical tensions.
