18 Jan Capitalizing on friendly ties with Oman

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Bangladesh can work on exploring export potential to Oman. Readymade garments, footwear, medicines, ceramics and agro products from Bangladesh have good export potential, writes

——Mehdi Mahbub

Bangladesh and the Arabian Peninsula have a long and outstanding bonding, religiously and economically. The Arabian Peninsula is the largest destination of Bangladeshi migrant workers and key source of earning remittance for the country. Although the Sultanate of Oman is the oldest independent state in the Arab world and a large number of Bangladeshi workers are now residing in this friendly country, many of us are unaware about Oman. With an area of 309,500 sq km and a population of over four million, Oman is one of the more traditional countries in the region which is also an isolated Gulf state. It is strategically located at the south-east corner of the Arabian Peninsula, at the mouth of the Persian Gulf. Oman whose capital is Muscat, is bordered by the United Arab Emirates to the northwest, Saudi Arabia to the west and Yemen to the southwest, and shares marine borders with Iran and Pakistan. The coast is formed by the Arabian Sea on the southeast and the Gulf of Oman on the northeast. The Madha and Musandam exclaves are surrounded by the UAE on their land borders, with the Strait of Hormuz and Gulf of Oman forming Musandam’s coastal boundaries. Al Said dynasty has been running Oman as an absolute monarchy. In 1970, the then Sultan Said bin Taimur was deposed in a bloodless coup by his son Qaboos bin Said. Sultan Qaboos, aged now 75, is the longest-serving ruler in the Middle East. In 2010, the UNDP ranked Oman as the most improved nation in the world in terms of development in the preceding 40 years. Oman maintains a good relation with its neighbours. Since 1970, Oman has pursued a moderate foreign policy, and has expanded its diplomatic relations dramatically. Oman is among the very few Arab countries that have maintained friendly ties with Iran. Unlike the majority of its Gulf neighbours, Oman managed to uphold diplomatic relations with both sides during the Iran-Iraq war from 1980-1988. The recent escalation of tension between Saudi Arabia and Iran, is not affecting the position of Oman. Many observers expect Oman might play an important role to mitigate the tensions between the two regional super powers. Oman is categorised as a high-income economy with notable oil and gas resources and substantial trade and budget surpluses. Oil reserves were discovered in 1964 in Oman and extraction began in 1967. Oman has a strong and diversified private sector, which covers industry, agriculture, textile, retail and tourism. Its major industries are copper, mining and smelting, oil refining and cement plants. The government of Oman has been working to bring more Foreign Direct Investments, especially in the industrial, IT, tourism and higher education fields. Oman’s Industrial development plans focus on gas resources, metal manufacturing, petrochemicals, and international transhipment ports. As Oman’s economy becomes more diverse, it is causing changes to the demographics of expatriates in Oman. It is estimated that Oman has around 1.7 million expatriates. Around 700,000 workers have been working in the construction sector alone in Oman. According to the National Centre for Statistics and Information (NCSI) data, in November 2013 the number of Bangladeshis in Oman was 496,761, by November 2015 they have risen to 572,340. “Currently, Oman needs workers who can build more infrastructures. So, this may be the reason that more and more Bangladeshis are coming to Oman. Moreover, as Bangladesh’s economy is now more dependent upon remittances from migrants, they are promoting migration,” said Mohammed Khaldi, a board member of the General Federation of Oman Trade Union. There are 9.4 million Bangladeshis working abroad and they are remitting money equivalent to around 15 per cent of the country’s GDP (gross domestic product). Bangladeshi migrant workers have sent home $15.31 billion in remittances during the last fiscal year (2014-15). According to Bangladesh Bank updates, the country received $7.483 billion from July to December in 2015. With 10.7 per cent of the total Bangladeshi migrants now residing in Oman, the Sultanate is their third favourite destination after Saudi Arabia and UAE. Official data show that remittance inflow from Oman was $ 0.7 billion in fiscal 2013-14 which crossed US$1 billion mark afterwards. In addition to sending workers, Bangladesh can work on exploring export potential to Oman. Readymade garments, footwear, medicines, ceramics and agro products from Bangladesh have good export potential. Bangladesh and Oman can make win-win deals economically and socially in the coming days by strengthening the friendly relations further.

The writer is CEO & Chief Consultant, Best Sourcing Business Advisory Services.
mehdi.mahbub@bestsourcing.biz