Building up to it: Construction in Oman may reach 10% of GDP by 2020

Published January 13th, 2016 - 04:57 GMT
Oman

Construction sector has the potential to contribute around 10 per cent to the gross domestic product (GDP) by 2020 if effective initiatives are implemented, said a senior official at the Oman Society of Contractors (OSC).

The construction sector currently accounts for around 5 to 6 per cent of the GDP, Shahswar Al Balushi, chief executive officer of the Oman Society of Contractors, told ‘Times of Oman’ on Tuesday.

“Gross contribution is about $5 billion and the net contribution is $2 billion,” Al Balushi said on the sidelines of the second day of the OSC’s annual conference held at Crowne Plaza Hotel under the theme ‘Construction sector 2020: Now and then’.

The official believes that these figures can be almost doubled through partnership with the government and the implementation of effective strategies.

Challenges

Commenting on the major challenges facing the sector in 2016, Al Balushi said that they are mainly related to manpower and contractors. Also, with the decline in oil prices, there is the issue of job availability as business activities may decrease, he noted.

Asked how serious the impact of oil prices would be on the construction sector in Oman, Al Balushi said that many companies already have projects on hand this year but if the oil prices remain low this year and next year, the impact will start to be seen in mid-2017.

Initiatives

He said that the objective of the OSC’s annual conference was to discuss the existing challenges and propose the best solutions and initiatives to address them, especially through interactive workshops.

The society decided to bring together various companies to review a range of issues related to collaboration with the government and stimulating the economy through enhancing the construction sector, he added.

Asked about the proposals of the OSC, the CEO said that various groups worked on different topics during the workshop sessions and their input and ideas will be taken into consideration. Al Balushi added that one of the groups joined by him discussed a number of issues including the role of the government and Omanisation.

“The government should be more transparent in telling us which projects are going to be available and what is the sizes of these projects so we can (plan accordingly),” he stated.

Omanisation

Al Balushi also said that he thinks the focus of the Omanisation policy on white-collar jobs in the construction sector should increase. “I think it is a good idea because then we will build knowledge and capacity at the places where the Omanis want to work and then maybe gradually the lower end of the equation will (be developed) when the government is able to build a proper skill pool in the lower end,” he noted.

According to the January 2016 edition of the ‘Contractors’ magazine, the average Omanisation level in the construction sector stood at 7.41 per cent (54,753 Omanis) as of the end of July 2015, which is 26.57 per cent of the total Omani private sector workforce.

The official also said that it is important to brand the sector better as a good employer to attract more Omanis to join this field.

Competitiveness

Asked how the competitiveness of the sector can be enhanced, Al Balushi said that the activities of the companies need to be streamlined and the companies should look into various ways to cut unnecessary expenses and enhance efficiency. This can be done through the use of technology, he added.

According to the Oman Society of Contractors, the sector should also be cleared from hidden trade and freelance workers.

By Elham Pourmohammadi


© Muscat Media Group

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