OIA Launches 4 Programs to Increase Local Content
Nasser Al-Harthy: We established a directorate at OIA for In-country Value
Al-Mutasim Al-Sariri: The programs encourage the manufacturing of products instead of importing them
Oman Investment Authority (OIA) launched four programs to enhance In-country value as part of the ‘Qimam’ Project. This is pursuant to the Royal Directives of His Majesty Sultan Haitham bin Tariq with regard to increasing the local content; and in an effort to empower the private sector to assume its role in leading the Omani economy in line with the priorities of Vision Oman 2040, as well as enriching local content and supporting SMEs. The launch of the projects was attended by H.E Abdulsalam Al-Murshidi, President of OIA, and several government officials, as well as CEOs, economists, media representatives, and a number of entrepreneurs and SME representatives.
Nasser Al-Harthy, Deputy President for Operations at OIA, said that OIA is committed to empowering the Omani private sector, enriching local content, and developing and incentivizing SMEs. Accordingly, it established a dedicated directorate to manage all matters related to ICV, research, development, and innovation, as well as social investment in OIA and its companies. He added that the main elements necessary for improving the Omani workforce, enhancing the growth of SMEs, and regulating the process of research, development and innovation, and social investment had been identified with a view to promoting the local economy and developing a sustainable competitive market for goods, services, and human capital.
Al-Mutasim bin Said Al-Sariri, Director of In-country Value (ICV) at OIA, said that there are six main pillars that were identified as being the main pillars of the ICV Directorate at OIA, i.e., strategic planning for programs and policies that enhance local content; contributing to the development of SMEs, empowerment of the national workforce and developing local suppliers; optimization of research, development, and innovation; governance of social investment programs; and following up on the performance OIA companies in terms of local content.
He explained that the four programs launched by OIA as part of the ICV project ‘Qimam’ include: the Mandatory List of Products and Services, Vendor Development, Ringfencing of Products and Services, and Research, Development, and Innovation Guidelines, noting that these programs aim to support local suppliers of products and services, giving priority to local products, encourage the manufacturing of products instead of importing them, and motivate SMEs to enter the competition, in addition to building capabilities of local suppliers, and creating a culture of research, development, and innovation in OIA companies. Al Sariri added that the programs were designed by Omani talents from OIA and its companies in collaboration with a number of government and private institutions.
The development and design of the four programs went through several phases, starting with a study of the local market to analyze supply and demand and available business opportunities, followed by further analysis of the supply chains and local market data to identify the availability of local suppliers before enlisting services and products in the programs. Programs were shared with a number of relevant government entities and OIA companies in order to determine the types of products and services that can be defined for the local market as well as the programs related to SMEs. Moreover, the ICV action plan was embedded in the balanced scorecard and general performance indicators of OIA companies, with a view to following up on implementation during the months ahead.
The Mandatory List Program includes services and products that OIA companies are required to purchase and supply from local companies. Initially, the list, which is to be updated regularly, consists of 101 products and services, including 76 products, such as cables, buses, wooden pallets, medications, cleaning products and chemicals, office supplies, uniforms, food and beverages, gifts and general consumables; in addition to 25 services, including legal consultations, waste management, media, and manufacturing quality tests. To meet the objectives of this mandatory list, a mechanism is applied for selecting services and products in a manner that ensures the availability of suppliers and enhances competitiveness, taking into account high-quality standards and Omanization plans in the supplier companies. This, in turn, contributes to supporting the local market, giving it a priority to compete for opportunities, and encouraging it to manufacture products instead of importing them.
The Vendor Development Program aims to enhance and develop the capabilities of local companies, including SMEs, in new fields. The program enables OIA companies to work closely with local companies in order to build and develop solutions. Meanwhile, it will give companies the opportunity to develop and enhance their performance by building new capabilities, in addition to localizing new industries and upgrading them. The program is expected to improve the performance of suppliers in the local market, encourage innovation and enhance their competitiveness, as well as upgrade the capabilities of the Omani workforce.
This program aims to allocate a certain percentage of the scope of work to local companies in order to increase their market share. The program, which targets SMEs and local companies, is expected to contribute to developing the capabilities of local companies, creating a competitive and sustainable local market for goods and services, and improving the capabilities of the Omani workforce, in addition to increasing the productivity of the local market.
The fourth program aims to enhance the research, development, and innovation eco-system in OIA companies by integrating it into their business strategies and industrial activities, with emphasis on certain areas, such as food and circular economy, digital transformation and artificial intelligence, and energy and decarbonization. This translates into improving the efficiency of operations, adding new products and services and strategic research projects that can become viable commercial projects in the future, and making well-informed decisions based on data.
The event also witnessed multiple agreements signed between OIA companies and other local companies, including SMEs to promote cooperation in research, development, and innovation. Asyad group has signed two agreements, one with Rihal to initiate a digital database project, in which a data warehouse will be developed with analysis capabilities using the latest technologies in data science. The developed technology will allow decision-makers to make well-informed decisions that are based on facts and precise inputs and will also allow employees to access data from other departments in the company. The second agreement was signed with the German University of Technology (GUtech) to develop a technology that helps in reducing emissions from cargo ships by capturing and liquefying carbon dioxide to facilitate storage and transportation. Nama holding has signed 12 contracts with local companies for projects worth over OMR 1 billion covering three key scopes; the supply of cables and conductors, the supply of electric switches, and the supply of low-voltage substations.
On the other hand, Fisheries Development Oman announced cooperation with Khat Al Wusta International Co. to establish a manufacturing plant for fish container boxes using international standards to meet the existing demand from the group and the local market while building the capacity to expand into regional markets. The cost of the first phase is estimated at about half a million Omani Rials. It should be noted that OIA has launched several programs, initiatives, policies, and meetings to enhance ICV, e.g., issuing the Tendering and Procurement Policy and the Guiding Principles of in-country value, in addition to completion of the implementation of the ICV action plan for 2022, and creating an action plan and integrated programs for 2023. Moreover, OIA issued a package of supporting measures for SMEs, including sourcing purchases that do not exceed OMR 10,000 from SMEs holding the entrepreneurship card, and allocating 10% of OIA purchases of OIA to SMEs, in addition to exempting them from tender fees and granting them a preferential percentage of 10% in procurements and contracts that range from OMR 10,000 up to 50,000 in materials, services, etc. It also launched a tender for establishing an integrated electronic system for following up on the performance of companies in terms of ICV, which is to be launched in 2023.