Strengthening Oman’s Non-Oil Economy: How the New Manufacturing Strategy Boosts Investment and Business Growth
MUSCAT: The Sultanate of Oman is steadfastly advancing its economic diversification efforts, with a strategic emphasis on expanding the manufacturing sector. This initiative is aligned with the nation’s long-term development ambitions and aims to increase the contribution of non-oil sectors to the GDP, a goal highlighted by officials at the ongoing ‘Together We Advance’ forum in Muscat.
By the end of August 2025, Oman’s manufacturing sector, which produces goods for both domestic use and export markets worldwide, significantly contributed to raising non-oil exports to RO 4.421 billion. The sector’s overall contribution to the GDP is estimated at RO 4 billion, supported by 412 industrial establishments spanning 17 sectors. Among these, 166 firms hold the National Product Identity, and 5,056 products proudly carry the “Made in Oman” label.
Qais bin Mohammed al Yousef, Chairman of the Public Authority for Special Economic Zones and Free Zones (OPAZ), emphasized that the approved manufacturing plan leverages Oman’s competitive and comparative strengths. The manufacturing sector represents one of the country’s largest economic contributors, accounting for 10% of GDP. Non-oil sectors have grown by 8.3%, with manufacturing ranking second only to oil and gas in attracting investments.
As part of the Eleventh Five-Year Plan, the Oman Investment Authority has launched strategic manufacturing projects designed to drive economic growth, increase local content, support the localisation of supply chains, and create expanded opportunities for Omani talent.
Experts affirm that manufacturing plays a crucial role in adding value to natural resources, generating quality jobs for Omani youth, bolstering local supply chains, and increasing national exports to regional and international markets. The sector also helps reduce dependency on raw material exports by converting them into finished products with higher economic value.
Under Oman Vision 2040, the government has introduced a long-term manufacturing strategy aimed at enhancing the business environment, expanding local production networks, supporting local content, offering incentives to manufacturers, and streamlining investment procedures. Key manufacturing industries experiencing robust growth include petroleum and petrochemicals, refining and basic chemicals, food products, metals such as aluminium and steel, plastics manufacturing, and renewable energy products.
The industrial landscape in Oman is evolving beyond traditional heavy industries to include advanced manufacturing and renewable energy sectors, positioning the country as an emerging industrial hub in the region. Additionally, new factories are targeting markets across the Gulf and globally, further boosting non-oil exports.
Special Analysis by Omanet | Navigate Oman’s Market
Oman’s strategic emphasis on diversifying its economy through a robust manufacturing sector—now the second largest GDP contributor after oil and gas—presents significant opportunities for businesses to tap into emerging high-value industries like petrochemicals, metals, and renewable energy. Smart investors and entrepreneurs should consider engaging with government-supported initiatives that enhance local content and streamline investment processes, positioning themselves to benefit from expanding export markets and the growing emphasis on advanced manufacturing and supply chain localization. However, they must also navigate competitive dynamics and evolving regulatory frameworks to maximize long-term gains.
