By Pittsburgh Business Times

Oman is the midst of an infrastructure build-out whose opportunities extend all the way to Pittsburgh, according to panelists at Wednesdayâ¿¿s Pittsburgh Middle East Institute Conference.

The primary driver behind everything in Oman is encouraging the growth of industries that can employ the countryâ¿¿s young and growing population. The median age in the country is 24. That's why the country has focused on human capital development and logistics, according to Sultan Hamdoon Al Harthi, mayor of Muscat, Oman's capital.

But much of the spending is in bricks and mortar.

⿿The rise of the population is high. To create jobs we need to expand and build even new cities,⿝ Al Harthi said.

That means revamping existing infrastructure, including building six airports, new ports and terminals, hospitals and schools.

The infrastructure program follows the countryâ¿¿s strategy of bringing services and development to its countryside rather than encouraging citizens to concentrate in urban areas. That means building roads and running electricity and water infrastructure to remote parts of the country.

Omanâ¿¿s mountainous terrain can be a challenge for engineering and construction projects, he warned, but the business climate is smooth and friendly, he stressed.

Thanks to a free trade agreement that went into effect in 2009, U.S. companies that invest in Oman receive the same treatment as national Omani firms. The pact also reduces customs duties significantly, said Elizabeth McKune, executive director of Sultan Qaboos Cultural Center and former U.S. Ambassador, and "all imports and exports of goods are free from foreign duties in foreign trade zones."

Currently, Oman⿿s economy is heavily reliant on hydrocarbons, said Khalfan Al Barwani, an economist with the Central Bank of Oman, but ⿿the government is fully aware of the finite nature of its resources.⿝

In its Vision 2020 plan, the government has set a goal that no more than 9 percent of its GDP come from crude oil exports. Today, that figure is more than 50 percent, Barwani said.

The country is expected to significantly increase its natural gas production and consumption by growing local industries.

According to Devesh Sharma, managing director and chief commercial officer for Canonsburg-based Aquatech International, said ⿿the most important thing for an American company looking to do business in the Middle East is to take a long term outlook, make a long term commitment to the region and do everything they can do to be local.⿝

That means setting up local offices, as Aquatech has done in the United Arab Emirates. Sharma said the company will incorporate in Saudia Arabia this year and then look to Qatar and Kuwait for future moves.

Copyright 2011 American City Business Journals

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