Boston, MA -- (ReleaseWire) -- 07/23/2012 -- BMI View: Despite continuing political turmoil in the wider region, Oman's construction sector shows positive signs for the rest of 2012. Construction industry value is forecast to rise to US$5.4bn by 2016, up from US$3.8bn in 2012. Year-on-year (y-o-y) growth of 6.8% is expected for 2012, with annual average growth of 5.7% forecast between 2012 and the end of our forecast period in 2021. The main driving forces for this positive development are the energy and utilities industry, as well as the transport sector. However, we are also seeing encouraging signs concerning the government's wider commitment to boosting investment in its tourism industry - a key sector for diversifying the Omani economy.
Key highlights include:
- The Omani government announced plans to invest OMR314.9mn (US$817.9mn) in road infrastructure projects during 2012. OMR60mn (US$155.8mn) will go towards the OMR250mn (US$649mn) Sur-Bidbid dual carriageway, OMR62.5mn (US$162.3mn) towards the OMR62.5mn (US$162.3mn) Al Batinah Expressway and OMR10mn (US$25.9mn) towards the OMR40m (US$103.8mn) Mahdha-Al Rawda dual carriageway. The government has also announced that 681 infrastructure development projects, worth a total of OMR1.5bn (US$3.9bn), will begin during 2012.
- The Omani Public Authority for Electricity and Water (PAEW) announced that it has allocated OMR390mn (US$1.01bn) for electricity and water infrastructure development in 2012, reports ameinfo.com. The PAEW is undertaking the construction of four new power plants in different governorates and is also considering building further new facilities in both Duqm and Salalah. A 450MW power and desalination power plant will open in Salalah in April 2012.
- State-owned Oman Oil Company was granted a mandate to develop an Independent Power Project (IPP) in the governorate of Musandam, following a 'closed' procurement process. The gas-fired project will have a power generation capacity of nearly 120MW in its initial stages, and will be developed alongside the US$600mn Musandam Gas Plant project. The plant is scheduled to become operational in early 2014.
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Oman's Consultative Council, which was elected for the first time on October 15 2011, is unlikely to bring major changes to the country's political system, which is dominated by Sultan Qaboos bin Said al- Said. While Qaboos's decision to change the Council from a purely advisory appointed body, to an elected one that participates in the legislative process has brought about minor changes thus far, we do not expect significant concessions to be made.
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