BMI View: A number of sectors are expected to show healthy growth in Oman's construction industry, with transport infrastructure in particular expected to make strong gains over the medium term. The country's flagship railway network project will attract major investment and the road network is subject to ongoing improvement and expansion projects. Likewise , rising demand for electricity and water will also ensure continued investment in new utilities capacity, particularly as the government proceeds with plans to enhance the use of public-private partnerships. Residential and non-residential construction is also expected to post positive growth, supported by a growing tourism industry and popular support for various social infrastructure projects. We do note, however, that falling oil revenues have the potential to disrupt project timelines.
Latest Updates And Structural Trends
Oman's construction industry is expected to see real growth in value of 3.4% in 2016, to USD5.7bn. Although a relatively small market compared to others in the region (such as Saudi Arabia and the United Arab Emirates), Oman's construction sector benefits from high levels of government support and construction accounts for a significant portion of GDP.
Improving the country's transport sector remains a key focus of the Omani administration. Transport and Communications Minister Ahmed bin Mohammed bin Salim Al Futaisi noted in a May 2016 report that, as well as investing billions in physical infrastructure, Oman is also liberalising the investment side to allow private sector involvement in transport and logistics, with an aim to improving competition and driving modernisation.
In residential and non-residential construction, the development of Oman's tourism industry is a major driver of growth. Oman has identified 14 areas in the country to be developed as tourism destinations over the next 25 years and the Ministry of Tourism expects some USD35bn to be invested in the tourism sector - up to 80% of which will come from private investors.
|e/f = BMI estimate/forecast. Source: Central Bank of Oman, Ministry of National Economy, BMI|
|Construction industry value, OMRbn||2.15||2.21||2.32||2.47||2.67||2.85||3.04||3.24||3.42||3.61||3.80|
|Construction Industry Value, Real Growth, % y-o-y||4.65||2.44||3.21||4.36||4.86||3.83||3.59||3.56||2.53||2.51||2.49|
|Construction Industry Value, % of GDP||8.0||8.1||8.2||8.3||8.5||8.6||8.7||8.8||8.8||8.8||8.8|
Oman remains in third place in our regional RRI for the Middle East this quarter, with a score of 66.3 out of 100.
Oman performs particularly well in terms of Industry Risks due to a transparent and attractive competitive landscape that reduces threats to potential investors.
The government's plan to boost the use of PPPs will see the Oman's Industry Rewards score strengthen further.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
The Oman Infrastructure Report features BMI Research's market assessment and forecasts covering public procurement and spending on all major infrastructure and construction projects, including transportation and logistics by land, sea and air; power plants and utilities, and commercial construction and property development. The report analyses the impact of regulatory changes and the macroeconomic outlook and features competitive intelligence on contractors and suppliers.
BMI's Oman Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Omani infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Oman to test other views - a key input for successful budgetary and planning in the Omani infrastructure market.
- Target business opportunities and risks in the Omani infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Oman.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts, views and trend analysis covering infrastructure and construction, regulatory changes, major investments and projects and significant national and multinational company developments. These are broken down into construction (social, commercial and residential), transport (roads, railways, ports, airports, etc), and energy & utilities (powerplants, pipelines and so on).
Industry SWOT Analysis
Analysis of the major strengths, weaknesses, opportunities and threats within the infrastructure and construction sectors and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (up to 2012) and forecasts to end-2024 for all key industry indicators, supported by explicit assumptions, plus analysis of key developments in the market and risks to the main forecasts. Indicators include:
Construction: Industry value (USDbn); contribution to GDP (%); total capital investment (USDbn); real growth (%).
Construction industry real growth forecasts (%) and industry value (USDbn) forecasts for industry sectors are split into Residential and Non-residential and Infrastructure sectors. Where the data is available for particular countries the infrastructure is further broken down into indicators for the transport subsectors of roads, railways, airports and ports and the energy and utilities sub-sectors of power plants and transmission grids, oil & gas pipelines and water infrastructure. This dataset is unique to the market.
The reports also include analysis of latest projects across the infrastructure sectors (transport, utilities, commercial construction).
BMI’s Infrastructure Risk Reward Index
BMI’s Risk Reward Index provides investors (construction companies, suppliers and partners) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points. These provide indices of highest to lowest appeal to investors, with each position explained.
An assessment of the competitive landscape and key challenges to entering the market. Details of the largest companies active in the sector across the sub-segments of the industry, including the key financial figures from some of the largest players in the sector.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Infrastructure reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.