Commercial Legislation

Sub Section: Economic Development Electronic Banking Commercial Legislation Livestock

The Sultanate of Oman's tax and foreign investment laws have been constantly revised to encourage foreign participation in the private sector and to simplify the tax regime. In 1996 the overall level of taxation for companies was reduced from 35% to 25% and under this new legislation an Omani registered company with up to 90% foreign ownership will be taxed at this rate. In joint stock companies where Omani participation is at least 51% and where 40% of the share capital is offered for public subscription, the maximum tax rate is 7.5%. In April 1997 a Royal Decree for financial subsidies was promulgated, which allowed soft loans to be made to the private sector for new or existing projects, as well as to purchase new equipment and improve services.

Since the Government attaches great importance to attracting direct foreign investment, particularly in the industrial sector, important changes have been made. It is now possible, depending on the merits of the manufacturing project to have 100% foreign investment. In order to increase the attraction of investing in Oman, several steps have been taken to make the legal frame-work and regulations more investor friendly.

A new Foreign Capital Investment Law was promulgated in 1994. Foreign investment is permitted in Omani companies with capital of less than RO150,000 as long as the foreign share does not exceed 49% of this capital. However, foreign investment of up to 65% may be permitted by the Minister of Commerce and Industry on the recommendation of the Committee for Foreign Capital Investment. This may be further increased up to 100% of the company's capital for projects which contribute to the development of the national economy upon the approval of the Cabinet following a recommendation from the Ministry, provided that the project's capital is not less than RO500,000. Preference will be given to projects supporting the tourism sector.

Foreign (non-Omani) investors are allowed to hold up to 49% of the shares in public joint-stock companies, and in closely-held joint stock companies. At the same time they are treated as 100% Omani joint-stock companies from a taxation point of view and for Government subsidies.

The potential investor is protected by the law which stipulates that projects having foreign investment shall neither be confiscated nor expropriated, except in the public interest and on payment of compensation. Furthermore any disputes that may arise can be settled either by local or international arbitration with the mutual agreement of the parties concerned. Land for projects will be provided either by a grant of rights or long term lease agreement.

Commercial Agencies

A Royal Decree, which came into effect in November 1996, abolished the sole distributor agency system in line with the requirements of WTO membership. Under the revised legislation, traders licensed by the Ministry of Commerce & Industry, can import and distribute goods without permission of agents and without any obligation to pay commission. There are some 9,500 commercial agencies in the Sultanate.

Copyright Law

In June 1996, a copyright law under Royal Decree 47/96 was introduced. It is based on internationally accepted practices and is designed to provide copyright protection to all those involved in the creative field. Musicians, singers, writers, and producers of audio and video programmes are among those protected by this law, which supplements the existing Omani Trademark Law and will help to maintain ethical and international standards in the Sultanate in preparation for membership of the WTO, which gives top priority to the preservation of intellectual property rights and patents. In 1998 and 1999, after repeated warnings to audio cassette and video shops, a campaign was launched to confiscate around 80,000 pirated tapes. In February 1999, a regional forum on Intellectual Property Rights was held in Muscat by the Ministry with the World Intellectual Property Rights Organisation. In 1999, the Ministry announced arrangements for the registration of patents by Omani companies through the AGCC Patent Office in Riyadh.

National Insignia

The use and application of the National Emblem on commercial products is regulated by the Ministry to prevent its abuse and to discourage it from becoming a cheap and vulgar advertising symbol. Imports or manufacture of goods with the insignia incorrectly displayed are prohibited and any contravention of the ban may lead to confiscation of the goods, as well as prosecution and a fine.

MINERALS

In December 1997 a Royal Decree transferred the Directorate-General of Minerals to the Ministry of Commerce and Industry from the Ministry of Petroleum & Minerals (now renamed Ministry of Oil & Gas).

Minerals played an important role in Oman's ancient economy. Copper was mined from several sites about 5000 years ago. During the Iron Age in 1000 B.C., copper was extracted from a mine at Lasail in the Wadi Jizzi near to Sohar. The deposit was reworked in 1983 by the Oman Mining Company. Cumulative production and reserves from Lasail and two other mines in the same area amounted to 19.2 million tonnes until all three mines were depleted in 1994. As part of the copper project the Oman Mining Company had built a smelter adjacent to the mining sites which produced over 142,946 tonnes of copper cathodes from 1983 and 1994. Since the mines were closed due to the depletion of the ore, imported copper concentrate is now imported, refined and re-exported from Mina Sultan Qaboos.

After continuous exploration activity significant reserves of copper were discovered along the Batinah coast in 1997. Copper ore deposits have also been found at Rakkah and Hayl al-Safil in the Wilayat of Yanqul some 275 km from the smelter. According to a pre-feasibility study there are reserves of 18.6 million tonnes at 0.35% cut off grade. The ore, which has not yet been mined, will be converted into concentrate on site and then transported to Sohar for refining and export. During 1999, the exploration of the Batinah coastal area continued. Discoveries were made at Ghuzain, which were estimated to comprise 13 million tonnes of sulphide ore with between 1.2 and 1.4% copper content.

The Oman Mining Company was established originally as a joint venture with the private sector but is now entirely state owned. With the potential development of further deposits, a consultant was appointed in 1996 to evaluate the Company for privatisation. Phase One of the report has been accepted by the privatisation committee and as soon as Phase Two has been approved, it is expected that privatisation will go ahead, but the decision will depend on the state of the international commodity market and the world price of minerals like gold and copper. Prices are currently depressed but are expected to improve in the year 2000.

In 1994, a processing plant to extract gold and silver from the copper oxide deposits near Yanqul was built and production started later in the year. In 1999, the gold produced was 569 kgs and silver 6548 kgs. The life of the project is unlikely to extend much beyond the millennium. The company which was originally established in 1978 has achieved 74% Omanisation.

The Oman Chromite Company was formed in 1991 and currently exports chromite ore to Japan and China. Chromite reserves are put at two million tonnes and annual production increased to 25,000 tonnes.

Coal deposits with reserves of 122 million tonnes have been discovered in the Wadi Muswa and the Wadi Fisaw areas of the Sharqiya near Sur. Private investors are being encouraged to develop the deposits, while additional studies are being made with UN technical assistance.

Oman has large resources of industrial rocks and minerals, some of which are already being exploited. They include silica sand, dolomite, limestone, gypsum, various types of clay, sands and aggregate. The value of sand, aggregate, marble and other building materials mined in 1999 was RO22 million.

The Majan Glass Company is likely to extract the silica sand deposits in central and north Oman. There are four separate companies extracting marble. It is hoped that the private sector will invest in new export projects, exploiting the gypsum found at Shuwaymiah and the limestone deposits at Quriyat, Sur and Salalah. Gabbro is expected to be mined at Jebel al-Sheikh and Khatmat Milahah for export to the Gulf states.

OIL

The first oil concession in Oman was granted in 1925 to the D'Arcy Exploration Company, but after disappointing results, the licence was allowed to lapse. In 1937, a new concession was awarded to the Iraq Petroleum Company, but it was not until after the second world war that exploration began in earnest. Again the results were unsatisfactory and all the partners in the venture apart from Shell and Partex pulled out in 1960. In 1962, oil was discovered at Yibal and at Natih in 1963. When oil was found at Fahud in the following year it was decided to develop the fields and commercial exports began in August 1967.

Exploration

Since 1970, many other fields have been found and developed by Petroleum Development Oman (PDO). At the end of 1999 production had risen to an average of nearly 850,000 barrels a day from nearly a hundred fields, compared with 300,000 barrels a day in 1970 from only four fields. In 1974 the Government acquired 60% of PDO under the terms of the Participation Agreement. Since then PDO has relinquished acreage, for which other companies have been invited to enter into exploration and production sharing agreements with the Government. During 1996, four new exploration and production agreements, worth a total of US$120 million in exploration expenditure, were signed with international oil companies - Japex Montasar (Block 35), Arco Oman Inc.(Block 32), Philips Petroleum Oman Ltd (Block 36) and Triton Oman Inc.(Block 22). In January 1997, the Saudi Arabian Nimr Petroleum Company signed an agreement with the Government to invest US$50.5 million over a period of eight years to explore for oil and gas in the north-east of the Sultanate (Block 3). In July 1997, a Canadian company, Gulf Stream Resources Ltd signed an agreement to explore in Northern Oman (Block 30) and in September, Occidental Oman Inc signed an agreement to explore in the same area (Block 31). During 1998, three new agreements were signed with international companies for exploration in the offshore waters of Musandam and for areas of northern Oman - Occidental (Block 27), Triton (Block 40) and Amoco (Blocks 15 & 44). In March 1999, the Government signed an agreement with Shell Deep Water Oman to assess the oil and gas potential of an area of 18,267 km2 in the Gulf of Oman (Block 18). An onshore production sharing agreement was signed with Phillips Petroleum Oman Ltd (Block 38) and in September 1999, a third agreement was signed with a consortium of three companies (Novus, Atlantis and Oman Eagle Energy) for onshore Block 17 in the Musandam Peninsula. This was the 15th exploration concession agreement to be signed since 1995 when the Ministry launched a campaign to attract international oil companies to invest in oil exploration.

At present 9 onshore and 4 offshore blocks remain open.
During 1999, PDO discovered three new oilfields in South Oman at Ghafeer, Nafoorah NW and Iham as well as one in North Oman, at Lekhwair East.

Production

In 1980, Elf became the second company to produce oil, followed later by Occidental Oman Inc., Japex Oman Ltd and Novus. Apart from Novus, the oil from these companies, which accounts for about 6 % of Oman's total oil production, is transported and exported via the PDO facilities. In 1998, Elf relinquished its acreage and installations which were taken over by MB Petroleum.

Oman's oil production in 1999, from over one hundred fields, averaged around 900,000 barrels per day (bpd) and was only marginally higher than production in 1998. In April 1999, the decision was taken by the Government to cut PDO oil production by 30,000 bpd from this level in the interests of the oil producing states and to help stabilise the oil price on world markets. A further 20,000 bpd reduction was made in July.

Production in 1999

 Daily                                           Annual                                         Average

Company                                   Production

Production                               (million barrels)                                   (barrels)

PDO (Block 6)                                 310                                            847,923

Occidental (Block 9)                          15                                             43,483

Japex (Block 5)                                  3                                               8,136

Petrogas (Block 7)                              1                                              2,309

Novus (Block 8)                                  1                                              2,748

Total Production                              330                                           904,689



In February 1998, Novus Oman (Block 8) became Oman's fifth oil producing company with its offshore operations in the Bukha concession off the Musandam peninsula. Production is processed in Ras al-Khaimah.

Gulfstream (Block 30) is to become the first private sector company in Oman to supply gas from eight wells in the Hafar concession to the Government gas system in 2000. The gas is tied into the government gasline by a 16-kilometre pipeline which will carry daily production of about 85 million cubic feet.

Reserves

At the beginning of 2000 total recoverable oil reserves stood at 5.7 billion barrels. Additional reserves could be recovered but at a higher cost. Several discoveries have been made in recent years by PDO and the Oman Occidental Company. PDO has developed the al-Mukhaizna field, which came on stream in the year 2000 with production of 15,000 barrels a day.

It is the policy of the Ministry of Oil & Gas to restrict production to a level that does not exceed 6.5% of remaining reserves per annum.

Crude Oil Exports

Total exports for 1999 were 308,773,471 barrels (42,024,038 metric tonnes) compared to 300 million barrels in 1998.

All Oman's crude oil is exported from the oil terminal at Mina al-Fahal. Most of it goes to the Far East with Japan (31%), Thailand (21.2%), Korea (18.1%), China (12.8%) and Taiwan (6.1%) being the major importers during 1999. The remaining 10.8% of exports went to several other countries.

Oil Prices

The average price of Omani crude oil in 1999 was US$17.35 per barrel. The highest price during the year was US$24.72 in December, with oil prices reaching a nine year high in January 2000 due to the commitment by OPEC at the September meeting in Vienna to maintain oil production cuts until March 2000. In February 1999, the price of the Oman blend had fallen to as low as USUS$9.64 per barrel.

Retail market

All refined products used to be imported into Oman, until 1982 when the Oman Refinery at Mina al-Fahal came on stream with a capacity of 50,000 barrels a day. This capacity was increased in 1987 to 80,000 barrels a day to meet the needs of the local market. The refinery will be upgraded, but no large expansion is planned in the Mina al-Fahal industrial area. Plans for a second refinery in Sohar are well underway. It will be operated in olefins mode with a capacity of 75,000 barrels a day. This will allow for annual production of 300,000 million tonnes of propylene, which is sufficient to feed a world-scale polypropylene plant. The EPC contracts will be awarded in 2001 with construction expected to be completed by the year 2004.

In early 1999, unleaded petrol was imported from the United Arab Emirates and supplied to six service stations on a trial basis. It will be generally available in 2002. During 1999, the Mina al-Fahal Refinery was supplied with 31,225,542 barrels. To supply additional demand, the Oman Refinery Company imported 1,679,254 barrels of refined products.

Oman's third LPG processing plant was brought on stream by PDO at Saih Rawl at the end of 1999 as part of the Oman LNG project with a production capacity of 40,000 tonnes per annum. At present LPG is produced at the Yibal Gas plant (25,000 tonnes p.a.) and by the Oman Refinery (40,000 tonnes p.a.).The domestic market demand has been growing by about 5% every year. Total demand in 1999 was about 80,000 tonnes, which was met by production of 74,400 tonnes and imports of 8,300 tonnes. With an annual capacity of over 100,000 tonnes in the year 2000 there will be no more need for imports and Oman will be more than self-sufficient in domestic cooking gas.

Until recently all the products of the Oman Refinery Company were marketed through Shell and BP. Shell has 115 service stations and BP 74, which are owned and run by Omani dealers. Neither company was allowed to establish any new sites recently so as to allow the Oman Refinery Company to distribute fuels through its own marketing company established in 1994 with the brand name al-Maha and the national colours for its livery. Plans are being made for al-Maha to be privatised and be on the same footing as the other two marketing companies. By the end of the year 2000, al-Maha had 76 service stations and from 1st January 2001, both Shell and BP were allowed to open more service stations.

In July 1997, Shell Oman Marketing Company (SAOG) divested 51% of its capital in shares to local investors. 40% of the shares were floated on the Muscat Securities Market, while the remaining 11% was reserved for existing Omani shareholders and service station dealers. BP Oman followed a similar strategy with a share offer to the public in August 1998.

Towards the end of 1996, fuel cards were first introduced into Oman. Since credit cards have been widely accepted throughout the service station network, replacing cash for fuel purchases. Following the European pattern, convenience stores, ATMs and fast food outlets are all part of the service provided by the dealers. There are no self-service filling stations in Oman.

Several brands of lubricants are imported into Oman, but the lubricants blending plant at Mina al-Fahal, which is operated by Shell Marketing Oman (SAOG) has been able to supply nearly half the needs of the Sultanate as well as exporting to neighbouring countries. In 1996 it was awarded His Majesty the Sultan's Cup for Industry and since then has won the Cup for a second time, as well as being the first company in Oman to achieve ISO 9002 certification.

The Oman Oil Company

The Government established the Oman Oil Company in the late eighties with the intention of entering into foreign joint ventures and oil trading operations. Since then a number of projects have been considered. An ambitious plan to lay a deep sea gas pipeline to India has been shelved, but the Company is actively involved in other projects, notably the Caspian pipeline consortium in Kazakhstan in which it has a 7% shareholding and the Oman fertilizer project, in addition to a joint venture refinery project in India. In November 1998, the Oman Oil Company signed a participation agreement with Arco and Exxon to explore for oil and gas in two offshore blocks in the Kazakhstan sector of the Caspian Sea.

GAS

The Oman Gas Company

The Oman Gas Company was established in 1999 with a capital of R030 million. It is 80% owned by the Government with the Oman Oil Company holding the remaining 20% of the capital.

The Company will own and operate the existing government gas pipeline system and will construct the new gas lines to Sohar and Salalah, which together will cost about US$500 million. The gas lines are expected to be operational in 2002. A 32-inch line will be laid over the 300 kms from Fahud to Sohar for the new heavy industries, while a 700 km 24- inch pipeline will take the gas from Saih Nihayda to Salalah for the Dhofar Power Corporation project currently under construction. In February 2000, the RO70 million Salalah pipeline project was awarded to Dodsal and the RO50 million pipeline to Sohar to a CCC-Saipem consortium.

Training & Omanisation

The oil industry is a capital rather than labour intensive industry, but human resources are of the utmost importance. PDO has a long record of training Omanis and has made good progress with Omanisation. The oil producing companies had achieved 87.3 % Omanisation by the end of 1999, while the exploration companies averaged 50%. It is hoped that complete Omanisation will be achieved by the year 2007. In 1999, about US$28m was spent on training at home and abroad, of which half goes on full time sponsorship of students on degree courses.

Natural Gas

The first LNG export from Qalhat was made on Thursday, 6th April 2000 on board the Hanjin Sur bound for South Korea. This event, which took place on the first day of the new Islamic Year (1421 A.H.) was a milestone in the history of Oman as well as marking a turning point in the country’s economic fortunes. As Oman enters the new millenium and celebrates 30 years of progress and development, this event is a fitting tribute to His Majesty and proof, if any were needed, that this enormous project, inspired by His Majesty’s vision and encouragement has indeed come to fruition.

The Oman LNG (Liquefied Natural Gas) project forms an integral part of the Sultanate's strategic and economic vision of the future. It is not only the biggest development project ever undertaken in Oman, but it is also one of the largest in the world and the fastest to come on stream - less than nine years from the discovery of substantial gas reserves in central Oman. The first customer shipment was in April 2000 to Korea.

The Company, Oman LNG LLC, was set up by Royal Decree to handle the downstream operations of this gas export project, namely the liquefaction, transportation and sales of LNG. The shareholders are the Government 51%, Shell 30%, Total 5.54%, KOLNG 5%, Partex 2%, Mitsubishi 2.77%, Mitsui 2.77%, Itochu 0.92%. The upstream part of the project is wholly owned by the Government, but is operated by Petroleum Development Oman, which has responsibility for field appraisal and development, gas processing and transport by pipeline to the liquefaction plant at Qalhat near Sur.

Project Development

The gas fields in central Oman, discovered between 1989 -1991, are being developed for the Government by PDO.

Total proven gas reserves at the beginning of 2000 stood at 29.3 tcf, of which over 25 tcf was non-associated gas. These figures indicate that there are ample reserves to supply not only the LNG project, but also to provide gas for the polyolefin and aluminium projects at Sohar. Moreover, the gas going to Sur will supply the fertilizer project and provide a source of energy for domestic power generation and other small industries. The Government is optimistic that larger quantities of gas remain to be discovered.

The gas is transported from three fields in Central Oman to Sur via a 360km 48-inch diameter pipeline, which, with the processing plant at Saih Rawl and associated facilities, was completed in 1999.

Construction Companies

The LNG plant in Qalhat is designed to produce a nominal 6.6 million tonnes of LNG per year from two LNG process trains. Following an international tender, Chiyoda/Foster Wheeler was awarded the US$1.2 billion Engineering Procurement and Construction (EPC) contract in November 1996. The construction of the Qalhat LNG complex was carried out by an Omani joint venture formed between the main contractor and two Omani companies - Zubair Enterprises and the Suhail Bahwan Establishment. Civil construction work on the site of the plant and terminal, which is situated on the coast 15 kms north of Sur, began in November 1996, when the foundation stone was laid by His Majesty the Sultan. The site is to be known as Qalhat after the nearby ancient sea port of that name. Construction was completed in mid-2000.

Financing

The project has in part been funded through a US$2 billion financing arrangement signed in November 1996 with a large group of international and Omani banks, supported by export credit agencies: ECGD of the UK, US-Exim of the USA, NCM of the Netherlands and SACE of Italy. Oman LNG has achieved 80% financing, a percentage of project financing which is unprecedented for a development of this nature in the Middle East. The rest of the finance has been provided by the shareholders in the project.

Marketing

In October 1996, the sale and purchase agreement for two-thirds of the plant output (4.1 million tonnes p.a.) was concluded with the Korean Gas Corporation ( KOGAS) for a period of 25 years, commencing in the year 2000. This is the largest-ever single gas contract between two companies. KOGAS, which requires six LNG tankers to lift 4.1 million tonnes p.a., has taken delivery of five of them, but two more are being built for other customers making a total of eight in all. An agreement was also reached with Japan's Osaka Gas Company Ltd to supply 0.7 million tonnes p.a. over a 25 year period in October 1998. Deliveries will commence in November 2000. In December 1998, Oman LNG signed a Sale and Purchase Agreement to sell 1.6 million tonnes per year of LNG to the Dabhol Power Company of India for a period of twenty years with the first cargo delivery expected towards the end of 2001.

Oman LNG has also signed a contract with Coral Energy Resources of the United States for two cargoes, each of 125,000 cubic metres, to be shipped in 2000 and 2001. They will be Oman LNG's first exports to cross the Atlantic instead of going to the Far East. Efforts are also being made to market any surplus of Oman's LNG in Europe.

A Sale and Purchase Agreement with Total to sell more than 130,000 tonnes of natural gas liquids (NGL) was also signed in June 1999. Total lifted the first cargo of NGLs in May 2000.

Human Resources

One of Oman LNG's key objectives is to facilitate and implement a skilled Omani workforce. The natural gas processing industry is relatively new in Oman and a qualified workforce is not readily available in the required proportions. To achieve higher levels of Omanisation, the company has undertaken the sponsorship and development of several training programmes, either directly or indirectly through its contractors. Some 500 young Omanis have undergone skills development programmes. Some of these young people have become qualified to work in the construction industry, while trainees under Oman LNG technical and skills training programmes are intended to work and develop their skills up to senior staff positions in Oman LNG's plant organisation. The training of the operators for the new plant was carried out with the help of the Oman Refinery. In November 1999, the Company celebrated the graduation of 57 trainees after their two year training period. By the end of 1999 about half of the Company's workforce was Omani. The target for Omanisation is 95% by 2008.

Oman LNG's contribution to Omani Society

The Company will provide a new source of national income in addition to oil revenues, as well as lessening dependency on oil exports. Indeed, this overall project is expected to increase oil and gas revenues by 18%, with the LNG plant contributing to almost 10% of today's Gross National Product.

Apart from Oman LNG's own training programme, the Company also plays a key role in helping Omanis to learn the skills needed to set up and run their own businesses. It is also assisting Omani companies and businessmen develop the competencies needed to help them win contracts at the LNG plant for the materials and services that it needs for its operations.

The Company contributes funds to the Intilaaqah ('Getting Started') programme - a scheme designed to train young Omanis to set up their own businesses. In 1997, Oman LNG paid for the training of 39 students and in 1999 funded an additional 40 students on the programme. The total contribution to this programme is over half a million dollars. In addition to funding the Intilaaqah programme, the Company has set up a scholarship scheme for Omani students to go overseas for higher education.

The Company has been involved in a number of other projects benefiting Omani society. Oman LNG has funded a RO17.5 million 240-bed hospital in Sur which opened this year. The Company has also paid RO600,000 for construction of a new section of the Sur corniche and RO100,000 for building the Bir Bwera road in Sur.

AGRICULTURE

Although many employment opportunities are being created with the diversification and development in other sectors of the economy, well over half the population is still dependent on the agriculture and fisheries sectors of the economy when related activities, such as wholesale, retail, transport and other services are taken into account.

According to the last agricultural census carried out in 1992/1993, about 102,659 people work in agriculture of whom nearly one third are women. This represents almost 12% of Oman's working population. In the current country-wide drive for Omanisation, regulations have been issued by the Ministry of Social Affairs, Labour and Vocational Training prohibiting expatriates from handling agricultural machinery.

A large percentage of the population live in rural areas and many others own land and property in the countryside even though they live and work in the towns. It is a major challenge for the Government to prevent a rural exodus by setting up programmes of rural education and to ensure that communities make the best use of limited water resources for maximum productivity. The protection of agricultural land is a major concern of the Ministry. In 1995, a single flood protection barrier in the Wilayat of Ibri cost RO646,000. This kind of barrier, which is 1.6 kms in length and 3.5 metres high, is essential to prevent erosion and loss of valuable agricultural land. During 1999, there were insufficient funds to erect any flood protection barriers, however the Ministry has surveyed 74 locations for possible projects from 536 applications. Proposals for new barriers have been put forward in the next Five-Year Plan and a team has been set up to find methods of improving their construction and ways of sharing the cost with the local community that will benefit from their erection.

Self-Sufficiency in Food Production

In view of the constraints imposed by water resources, one of the main objectives in managing the agricultural sector is to maximise economic returns without adversely affecting the delicate water balance. The policy is to create sustainable agricultural methods and crops which will provide continuous employment opportunities for Omanis and reduce the deficit in the food trade balance. However Oman with its growing population and rapidly changing society will remain a net food importing country.

The current self-sufficiency rates are encouraging. The latest estimates indicate that Oman is fully self sufficient in fruit (dates & bananas) and vegetables when they are in season; but only 53% self sufficient in milk, 46% in beef, 44% in eggs and 23% in mutton. Any increase in livestock production is limited by the animal feedstuff available. Sufficient quantities of dates and some other fruits are produced so that they can be exported as well as meeting local demand. The production of tomatoes, potatoes and alfalfa has doubled in recent years. Agriculture now contributes over half the national food bill for fruit and vegetables.

Agriculture and fisheries are Oman's main non-oil exports. This sector accounts for over 35% of the non-oil exports and in 1998 contributed RO155.2 to the GNP, compared with RO153.4 million in the previous year. If the industries and services that depend on agriculture for raw materials, jobs and commercial enterprise are taken into account, the total contribution to the GNP is very much higher.

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