10% tariff on imports from Oman despite FTA
Muscat: In December 2024, the Ministry of Commerce, Industry and Investment Promotion celebrated the 15th anniversary of the Oman-US Free Trade Agreement (FTA). The agreement has fostered a favorable environment for American investors in Oman's energy, logistics, and infrastructure sectors, boosting foreign direct investment (FDI) and bilateral trade.
Strengthening Investment and Trade Relations
The United States is Oman's second-largest foreign investor, with FDI growing by 36.3% by the end of 2023. By the second quarter of 2024, US investments in Oman reached RO 5 billion (USD 13 billion), primarily in infrastructure, energy, and technology.
Bilateral trade has seen steady growth, exceeding RO 1.15 billion (USD 3 billion) annually since 2021. As of May 2024, the total trade volume stood at RO 412.6 million, with Omani exports to the US reaching RO 197.6 million—a 14.6% increase from 2023.
The US holds key positions in Oman's trade:
5th largest destination for Omani non-oil exports (as of May 2024)
9th largest source of imports (as of September 2024)
Understanding Free Trade Agreements (FTAs)
The World Trade Organization (WTO) governs global trade under the Most-Favoured-Nation (MFN) principle, ensuring equal trade terms for all members. However, exceptions allow for FTAs and preferential treatment for developing nations.
The US trades with over 160 countries under WTO rules and has FTAs with 20 nations, including Oman. On February 13, former President Donald Trump proposed reviewing foreign tariffs on US exports under his "Fair and Reciprocal Plan", which would match US tariffs to those imposed by other countries. He argued that many trade partners benefit from lower US tariffs while maintaining higher duties on American goods.
The Oman-US FTA continues to strengthen
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