Oman is a member of the Arab League. The country is also part of the Greater Arab Free Trade Area (GAFTA) Agreement, a pact of the Arab League entered into force in January 2005 which aims to form an Arabic free trade area.
The licensing of business activities can be complicated and can significantly add to the time it takes to get goods to or out of market. Companies looking to import goods to Oman must register with the Ministry of Commerce and Industry. A special license must be obtained for the importation of certain classes of goods, such as alcohol, livestock, poultry, firearms, pharmaceutical products and explosives.
Media imports are subject to censorship by the Ministry of Heritage and Culture for morally or politically sensitive material. The Ministry of Information delays or bars publications if their content is deemed morally suspect or politically sensitive.
Customs Duties and Taxes on Imports
Foreign, non-American/GCC goods are imported according to Oman’s tariff schedule, which imposes modest duties generally not exceeding 10%. According to data from the 2016 World Bank, the average rate of import taxes is 3.2%. With the entry into force of the U.S.-Oman Free Trade Agreement in January 2009, bilateral trade in industrial and consumer products, with the exception of certain textile and apparel products, is now duty free. Oman provided duty free access on virtually all products in its tariff schedule and will phase out tariffs on the remaining handful of products within a few years. There is no VAT on the sales.
Oman is a member of the World Customs organisation and does comply with the harmonised customs system.
According to the Royal Oman Police Customs Directorate (ROP Customs), the following are required for clearance of imported goods:
- An accredited copy of commercial registration and an activity form or permission for importing if such a form doesn’t exist. - A valid copy of the affiliation certificate to Oman Chamber of Industry and Commerce (OCIC). - A valid certificate from the manufacturer. - A valid quotation list. - Packing lists. - Bill of lading at sea and air custom offices only. - A manifest of the shipment (a document which contains a detailed description of the cargo). - A permission of deliverance from the shipping agent. - A comprehensive valid written authorization from the person in charge for custom clearance. - Paying the required taxes and custom fees for the total value of the shipment including cargo and insurance (CIF).
All imports into Oman above RO 1,000 must be accompanied by: an accredited copy of commercial registration, a copy of the affiliation certificate to the Oman Chamber of Commerce and Industry (OCCI), a commercial invoice, a bill of lading or airway bill, the relevant certificate or permit for restricted imports (section 3.2.6), and a certificate of origin for preferential imports.
There is no specific procedures for samples shipments. Sample shipments require the same set of documents as a normal shipment. The value of goods should still appear on the commercial invoice indicating "for customs clearance purpose only'' on the invoice. Zero value invoices are not acceptable.
While the long-term fundamentals remain strong, the retail market in Oman is presently under pressure due to economic slowdown. The impact on Oman’s retail sector has been higher compared to its Gulf Cooperation Council counterparts and the country’s wholesale and retail trade stood at US$4.9bn in 2016 compared to US$5.1bn in 2012, according to Alpen Capital, an investment banking advisory firm. Growth decelerated since 2014 and slumped by 18.2% in 2016. Some explanations pointed out the weak consumer sentiments and the focus made on buying essential items.
Oman’s retail landscape is concentrated in the hands of standalone retail outlets and has only a few regional and international retailers. The retail market is transforming to accommodate large leisure shopping complexes, as the Omani shopper is looking for a wholesome shopping experience with entertainment. From 2016, retail space has grown and large shopping centres are being built.
According to Alpen Capital, the size of the GCC retail sector is forecasted to grow at an average annual growth rate of 4.6%, after a slow pace growth in 2017.
There are several retailers and wholersalers all over the Omani's territory, shared between national and international companies: - French Carrefour, in joint venture with his local partner Majid Al Futtaim Group - SPAR, which owns around 24 franchises in the Sultanate
In parrallel, the traditionnal retail is still present with independant convenience and mini market stores.
Oman has a population of 4.6 million people, and the internet penetration rate is estimated at 71.1%. The sultanate is coming very close to 100% smartphone use penetration: the country has scored full mark on its mobile broadband penetration and its 4G coverage also reaches an average level. In recent years, Oman has made great efforts to build up its IT infrastructure both at governmental and private levels. Oman’s mobile phone subscriber base crossed 7 million at the end of April 2017, with a penetration rate of more than 150% (National Centre of Statistical Information - NCSI). The most popular web search engines in Oman are Google (97.2%), Bing and Yahoo (1.6% and 0.9% respectively).
The e-commerce market in Oman accounts for only 1% of total retail sales. Currently there is limited e-commerce activity in the private sector in the country, whereas the government is actively promoting a “digital society” and “e-government” services through the Information Technology Authority (ITA). Although reliable figures for the Omani e-commerce market value are not available, according to a study by Frost & Sullivan, internet spending in the Middle East as a whole is booming, with GCC countries expecting e-commerce revenues to reach US$ 41.5 billion by 2020, a 40% increase. Websites such as eBay, Aliexpress, Namshi, InvestEasy and Bayan Customs are famous among Omani residents. Omani e-shoppers mostly buy clothing, airline tickets, beauty care products, and hotel services. When it comes to cross-border e-shopping, China remains the main country of origin for ordering furnishing, machinery, construction materials, etc. In order to boost e-commerce and provide safe and secure e-commerce transactions, the Central Bank of Oman recently launched a national debit card payment gateway infrastructure for e-commerce transactions, the “Oman Net Debit Card E-Payment Gateway” infrastructure. Important factors influencing Omani e-shoppers are the ease of use, price convenience and post-sales service. On the other hand, major deterrents influencing e-consumer are the inability to touch and see the products, the concerns about the security of online payments and the impersonal shopping experience, together with problems related with the shipment of goods. There is an increasing trend among businesses especially among Omani owned SMEs and entrepreneurs to promote and sell their merchandise through social media. Data shows that Oman had 2.6 million social media users as of January 2018, around 55% of the Sultanate’s population. The total number of Instagram users reached 1 million, of which 68% are male. Finally, Oman had a total of 675,000 Snapchat users in 2017 (Hootsuite).
According to the CIA, the industry accounts for 45,2% of the GDP and only 1,7% belongs to agriculture. Oman's key industry sectors include crude oil production and refining, natural and liquefied natural gas (LNG) production construction, cement, copper, steel, chemicals and optic fibre. Oman's services sector accounts for 53% of the GDP, especially in tourism which remains one of the focus sectors in the diversification strategy of the economy.
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