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Oman
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The
inhabitants of the area of Oman have long prospered on
Indian Ocean trade. In the late 18th century, a newly
established sultanate in Muscat signed the first in a
series of friendship treaties with Britain. Over time,
Oman's dependence on British political and military advisors
increased, but it never became a British colony. In 1970,
QABOOS bin Said al-Said overthrew the restrictive rule
of his father; he has ruled as sultan ever since. His
extensive modernization program has opened the country
to the outside world while preserving the longstanding
close ties with the UK. Oman's moderate, independent foreign
policy has sought to maintain good relations with all
Middle Eastern countries.
Oman is a middle-income economy that is heavily dependent
on dwindling oil resources, but sustained high oil prices
in recent years have helped build Oman's budget and trade
surpluses and foreign reserves. As a result of its dwindling
oil resources, Oman is actively pursuing a development
plan that focuses on diversification, industrialization,
and privatization, with the objective of reducing the
oil sector's contribution to GDP to 9% by 2020. Some of
these projects may be in jeopardy, however, because Muscat
overestimated its ability to produce or secure the natural
gas needed to power them. Oman actively seeks private
foreign investors, especially in the industrial, information
technology, tourism, and higher education fields. Industrial
development plans focus on gas resources, metal manufacturing,
petrochemicals, and international transshipment ports.
The drop in oil prices and the global financial crisis
in 2008 will affect Oman's fiscal position and it may
post a deficit in 2009 if oil prices stay low. In addition,
the global credit crisis is slowing the pace of investment
and development projects - a trend that probably will
continue into 2009.
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