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Helping to boost Oman's exports
OMAN'S investment and export promotion agency Ithraa is a prime mover in helping to boost the Sultanate's non-oil exports and attract foreign investment.
The agency's director general of investment promotion Sayyid Faisal Al Said said: "Ithraa has worked with inward investors and Omani non-oil exporters since 1997 helping them identify opportunities domestically and internationally. And we have been successful."
The government-run, ISO and Investor in People-certified body provides a range of support services and information to help domestic and international investors set up in, and export from Oman.
Oman has made tremendous strides in developing its export industry and currently, Omani firms export to 136 countries and in 2014, exported US$10.71 billion worth of non-oil commodities. "Exporting is good for Omani business, good for Omani workers and good for Omani jobs. Put simply, when Oman exports, Oman prospers," Sayyid Faisal summed up.
He is very clear about the agency's direction. "Targeting middle-class consumers in Asia and Africa as well as in Europe and North America is crucial to putting Oman's economy on a solid footing. Helping businesses penetrate these markets is what we excel at," he said.
"Exporting is of course fundamentally a decision driven by local businesses. But, firms attempting to close an export sale can face hurdles, including lack of readily available information about exporting and market research, challenges obtaining export financing and strong competition from foreign companies," pointed out Sayyid Faisal.
He said these are areas where Ithraa's staff and services play a vital role. They help Omani businesses assess all elements of export opportunities, from developing a plan, identifying buyers and markets, advising on regulations to managing logistics.
"We provide businesses with information, research, market studies, B-2-B meetings, participation at international trade shows and contact with our representatives in markets across the globe. Our goal is to provide everything an ambitious company needs to succeed in today's global economy," he said.
One of the top events that Ithraa has played a leading role in include the Omani Products Exhibitions held in Riyadh, Dubai and Doha. "This initiative was designed to help expose local companies to the many commercial opportunities available in Saudi Arabia, the UAE and Qatar. And with mega events such as the World Cup and the World Expo coming to the region, it is important we help local businesses explore and penetrate these markets," said Sayyid Faisal.
Ithraa has also been helping Omanis to enter more mature markets in the West. "We have been helping Omani companies participate at major international trade shows in the Gulf, US, Asia, Africa and Europe. We have also been encouraging Omani exporters to take advantage of the Oman-US Free Trade Agreement which has seen our non-oil exports to the US reach over US$813 million in 2013," he said.
Sayyid Faisal said helping Omani firms of all sizes penetrate mature as well as emerging markets is a key objective of Ithraa and the agency has achieved considerable success in this regard, with the number of Omani firms exporting to international markets continuing to rise.
"Our non-oil exports matter because they represent the very sectors that drive wealth, attract investment and talent, boost productivity and innovation and generate employment. The production of exported goods and services creates jobs, both directly and indirectly in the supply chain," he said.
Sayyid Faisal cited a study for example that found with every US$1 billion in new exports 5,400 additional jobs were created. In addition, SMEs that export generally experience greater revenue growth than non-exporters and weather tough economic times better as a result, he said, citing another study, which found that SME manufacturing exporters grew revenues by 37 per cent while non-exporting manufacturers experienced a 7 per cent decline in revenues.
Diversification of Oman's exports to the non-oil sector is an important national objective and with the help of Ithraa, the Sultanate is making good progress. In 2014 Omani non-oil exports amounted to US$10.71 billion rising 8.3 per cent over the year before. "This is healthy and exciting. Indeed, it speaks volumes about the quality of the products made in Oman," said Sayyid Faisal.
Ithraa is focusing a lot of its efforts on helping SMEs in particular. It has found through experience that small Omani companies that are new to exporting often need help getting started. "Even companies that are aware of global opportunities often prefer operating within the confines of Oman's market, where they have successfully grown their businesses," he said.
"We understand that small Omani companies require assistance expanding into foreign markets due to their own internal constraints and perceived trade barriers," Sayyid Faisal said. For example, issues with customs and compliance, distributors, intellectual property protection, financing, marketing, packaging and language barriers are some of the biggest barriers to becoming exporters, he noted.
In response to these challenges, Ithraa created the Trade Up seminar series which is designed to help small firms that are new to overseas trading take the plunge, as well as assist those already trading internationally to increase sales. "Through the Trade Up series, we have tapped into the experiences of seasoned exporters to give businesses ideas and advice on how to avoid the main pitfalls and build a successful book of export business," concluded Sayyid Faisal.
Over the past few months Ithraa has also organised trade missions to Brunei, China, Italy, Iran, Ethiopia and the UAE, which have proven very successful and have helped strengthen business ties with these important international markets, he said.