Sunday, September 06, 2009

Sunshine Industry

Oman’s manufacturing industry is easy to overlook. “Perhaps we’re better known for our beaches and world-class resorts than we are for our industrial estates,” says Ibtisam Al Faruji, Marketing Director at the Public Establishment for Industrial Estates (PEIE) and organizer of Oman’s annual Smart Manufacturing Conference.

Yet manufacturing brings two important things that most other sectors do not: high-paying jobs and major inward investment. “Manufacturing is the protein that feeds the Omani economy,” smiles Al Faruji.

However, the manufacturing sector right across the world has suffered since the global recession began in December 2007. The US has lost about 11% of its manufacturing jobs, while the Japanese have lost 16% of theirs. Even developing nations lost factory jobs: Brazil has suffered a 20% decline and China has experienced a 15% drop. But according to PEIE’s Marketing Director, Omani manufacturing jobs may be starting to grow again. “We’ve over 600 manufacturers based on PEIE estates and this number is expanding each year. In fact, we’ve seen substantial growth in Sohar, Rusayl and Al Buraimi. And our tenants are working in diverse areas - operating in food production, construction, pharmaceuticals, automotive spare parts, glass, textiles, through to aluminium. Indeed, a large proportion of our tenants are export-driven making them important base industries. It’s this type of industry that attract outside money. Moreover, it’s estimated that every manufacturing job brings in about 2.5 other jobs, such as retail, insurance, IT, real estate and other services.”

But what does a post-recession manufacturing sector look like? What are the growth areas and opportunities? Nasser Al Rahbi, PEIE’s Media Manager suggests future industries could include solar and renewable-energy manufacturing. He believes that Oman should have an edge because of its abundant sunshine, proximity to the growing Gulf and Indian markets and the high number of engineers graduating from Oman’s universities.

“The key”, Al Rahbi argues, “is to establish synergy, or enough companies making and researching renewables that encourage more companies to join them – creating a critical mass is really important.” He continues: “It's a question about who gets in early, about who builds a concentration. And the big difference in solar and renewables is that not every country can produce a demand like we can. Given the Gulf region’s population growth, the demand for energy and environmental concerns, we’ve a marvelous manufacturing opportunity to exploit renewables and green technology and create jobs for the future.”

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