FTA offers Omani exports competitive advantage
MUSCAT: The Omani Economic Association (OEA) convened a session of its Economic Council under the theme 'International Customs Policies and Their Impact on the Omani Economy,' focusing on the implications of global tariffs and the benefits of the US-Oman Free Trade Agreement. The session, held at Omantel's headquarters, featured His Highness Sayyid Dr Adham bin Turki Al Said, Chairman of the Economic Committee at the Oman Chamber of Commerce and Industry; and Khalid bin Said al Shuaibi, Head of the National Programme for Investment and Export Development (Nazdaher); and was moderated by Dr Khalid bin Said al Amri, Chairman of the OEA Board.
Speaking first at the session, HH Sayyid Dr Adham said, 'Today's global developments are not spontaneous; they are the result of accumulated trends, accelerated post-COVID-19. The response came as a reaction to globalization, industrial nations began subsidising their exports. The US perceived Chinese export-driven production as a threat, prompting Trump to introduce a wave of tariffs, which ultimately hurt American consumers and companies. Still, there were positive outcomes, such as new free trade agreements with the US, understandings with the UK, and the reshaping of NAFTA, from which the US now benefits, despite spending more than it produces. These tariffs have attracted some industries back to the US.'
He described Trump's approach as a "shock policy", stressing that the American market remains attractive. 'The US and China are clearly diverging. Despite the friction, the US remains reliant on Chinese investments. Tariffs are likely to remain, with Trump's main goal being economic recovery and job creation in the US,' he added.
Speaking to the Observer, Khalid bin Said al Shuaibi, Head of the National Programme for Investment and Export Development (Nazdaher), affirmed that the FTA between Oman and the United States remains in effect, ensuring that Omani products are exempt from standard customs duties. However, he clarified that the additional 10 per cent customs duty currently applied across all imports does affect Omani exports.
'The Free Trade Agreement (FTA) remains valid. Omani products exported to the US are not subject to standard customs duties, except for the additional 10 per cent applied across all imports. Negotiations are ongoing to address and potentially ease these charges,' he stated. Al Shuaibi emphasised that, despite this added tariff, the FTA continues to offer Omani exporters a competitive advantage in the US market, and discussions are underway to mitigate the impact of these new duties.
Dr Khalid bin Said al Amri, Chairman of the Board of Directors of OEA, remarked,
'Ongoing economic disputes between the US and China continue to cast a shadow over the global economy. Former President Trump's decision to impose tariffs on over 60 countries, though delayed briefly, still impacts the global economy. With economic uncertainty prevailing, many countries are using tariffs as economic tools, a form of tax on imports.'
He argued that such economic challenges can be viewed as opportunities rather than obstacles. 'They offer a chance to support national industries and encourage innovation, building a more resilient domestic economy capable of withstanding global fluctuations,' he said.
He acknowledged the recent decline in oil prices and the drop in the Muscat Stock Exchange Index, but said, 'That doesn't mean we should stand idle. These global shifts must be used to facilitate trade in target markets, create new supply chains, expand and diversify markets, and develop new products. From such challenges, opportunities are born.'
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