United World talks to H.E. Dr. Ahmed Mohammed Salem Al-Futaisi, Minister of Transport & Communications, Sultanate of Oman, about the billions being spent on infrastructure projects throughout Oman
What was the state of the transportation sector when you took over the Ministry and what were your first priorities?
First of all, I would like to say that Oman has developed a fantastic road network and all Omanis are really proud of it. We have invested billions of Omani Riyals into roads that go through mountains and difficult terrains in order to spread the local road network and infrastructure throughout the country. Having a government that really looks into the needs of the people with regards to infrastructure is a great advantage for Oman. In many countries governments do not necessarily spend a lot of money on these things, but our government does. Road transport is essential for Oman and we had to maintain the quality of contractors and develop a good maintenance system for our roads. We also needed to complete proper strategic studies for transport systems and look at developing different means of transport, rather than just relying on roads. These are the main things that I am looking at right now.
Another challenge that we are facing is the construction of six new airports at the same time. Even though in Muscat and Salalah Airports we are talking about expansions, in reality they are completely new projects. We are also building four local airports from scratch. The airports are built in a very modern and fancy way as we want the buildings to stay in visitors’ minds forever. Maintaining the quality and high standards is a major challenge for the Ministry because such projects are a new thing for us.
In Muscat we are constructing a very high-tech building and we are creating a new life. When I started, the project was experiencing major difficulties, there were delays and the costs were escalating. One of my major tasks is to bring these airport projects in line and make sure that they are completed on time, within budget and with the quality required. I would say that since I joined until now, I have spent probably 60% of my time getting these projects on track and ensuring that they are delivered on time. But now things are set up, and I have more time to focus on the other sectors.
How are the works progressing and what are the expected completion dates for the six new airports?
We expect the construction of Muscat Airport to be completed by April 2014. We have allocated an additional six months to ensure that the soft operations work well. We call it the ‘Readiness Program’. We anticipate that the airport will officially open in October 2014. Given the size and complexity of this project, this deadline is very ambitious. It is not just about building a terminal or an airport; it is about preparing all the documentation required for the airspace, landing and take-off. It is a completely new program. We are also moving from a small building to a huge terminal and this requires lots of additional resources. The construction, readiness and the airspace preparation are all being developed in parallel. We are also working on marketing the new project. The capacity of the current airport is around five million passengers, whilst the new airport will be about to receive around 12 million passengers when it opens in 2014.
The Salalah airport is built as an international airport, and it is currently receiving many international airlines. We need to conduct more studies in order to make it fully international.
The other four airports are built to be a hub in those regions so that they regenerate the surroundings. For example, we are building an economic zone in Duqm and we hope that this city will play a major role in Oman’s economy in the future. We are building the city from scratch. Airports and ports are major elements for the economy.
Sohar, as you know, is growing in a big way and it has a fast growing population as well. We have a very ambitious economic zone development plan comprising of a free zone, industrial and commercial activities, port and industrial estates. It has really contributed to the economy. Having an economic port zone over there will require very strong transport connections, by air, rail and an express highway project from Sohar, Muscat and other directions. The airport will be a passenger and cargo airport and will support the port activities over there.
Ras Al Had is more of a tourist destination. It is a very beautiful place in Oman with very nice weather. We would like to build more hotels and resorts and large scale tourism activities. But which comes first – the infrastructure so that hotels will want to develop in the area, or do we wait for hotels to come and develop and then we build the transport infrastructure?
It is the same thing for Adam Airport, which is in the interior region and is very close to His Majesty’s palace. He has visitors coming from all over the world. We could develop aviation academies there. We are building these things so that airports can be points of attraction so we can build economic areas or tourist attractions in the surrounding areas. We are hoping that the local airports will enable tourism and the economy to flourish. It is all part of the bigger vision for that region.
Omani seafaring tradition is deep rooted and has been recognized throughout the world from ancient times. Under the 8th Five-Year Development Plan, 1 billion USD has been committed to the development of Oman’s sea ports and the expansion of the existing ones. How are the works progressing?
Even though Oman is a relatively small country, we have many ports due to our long coasts and the strategic location we were blessed with. I think we have done a marvelous job with the ports. We have developed major port projects in Salalah, Duqm and Sohar. There are three other ports as well, in Muscat, Shinas and Khasab. Some of these ports are a mixture of commercial, industrial and tourist ports, and they are very well-respected around the world, particularly the Salalah Port and Sohar Industrial Port. We are trying to get these ports to be specialized so that they do not compete among themselves.
Due to its location, Salalah Port has become an internationally renowned transshipment port linking the Indian Continent and Asia with Europe. It is the largest transshipment port in Oman.
Sohar Industrial Port is a mixture of commercial and industrial activities. It is a very successful port and we have brought huge industries to the port which has transformed activities in the whole area. We have one of the largest hydrocarbon factories and steel factories in Sohar.
Duqm is not just a port, it is a complete Economic Zone. Our Ministry is a major player in this groundbreaking development and we hope that the marine infrastructure will be completed soon. We are 95% done with marine work, however many infra and superstructure works are yet to start. We also have a Dry Dock in Duqm which is one of the biggest in the region. We have already received more than 40 ships and we hope that Duqm Port will be a great success. By 2016 we are expecting the beginning of operation.
Sultan Qaboos Port in Muscat was the first commercial port in Oman. However, last year His Majesty declared that Sultan Qaboos Port will be transformed from a commercial port into a completely tourism based port. This vision was inspired by the beauty of that area of Muscat, and as a result Sultan Qaboos Port will become the first tourism port in Oman. It will be a great boost for the development of tourism activities in Oman and it will also benefit the local population of Muscat. We have started shifting the commercial activities to the Sohar Industrial Port and we are hoping to complete it within a maximum period of two years. We are also working on a master plan for the redevelopment of that area. It has already been assigned to a consultant and they are working on it. We anticipate that it will take one year to complete the master plan, and if it is approved, we will start to implement it. However the shift will be gradual and should not affect the commercial activities in the port. We want to have our roads ready for such a big shift.
The two ports in Shinas and Khasab are not as big as the other four ports, however we are also expanding these two ports and hope that they will contribute to the economy as well.
We will be very busy over the coming years and we hope that by 2016 all these mega projects will be operative. Such a major transformation of our transport network will contribute greatly to Oman’s economic development by boosting trade and economic activities on one side, and providing jobs for our people on the other.
However we have to work on integrating our transport system. We are building major roads, ports and airports projects, but we really have to look at how to link all these systems together. We have to think about the most feasible way to move the cargo by sea, air cargo or through the ports or roads. There are several options and we should benefit from them all. Integrating our transportation system is a major strategic task which we are now looking at. We are assigning consultants to do studies and find out the best options available.
How closely do you cooperate with neighboring countries in the development of a regional integrated transport network?
The ties with our neighboring countries play a major role in the strategic planning of our transportation networks. We would like to be very well connected with our neighbors so that we can improve the business links between different countries. At the same time, we want to enhance the potential for the development of tourism in Oman, as we have been blessed with diverse and beautiful terrains.
The link to the neighboring countries is very strategic and the Gulf Cooperation Council (GCC) countries approved a GCC Rail Network for 2018. Every country is building its own route. We hope to take our route from UAE to Sohar, Muscat and then Duqm. It is a major project comprising both cargo and passenger rail. The project has been approved and the budget has been allocated. We are at the stage of selecting the consultant for the design and we are evaluating the tender. A consortium of five companies has taken part in the consultancy project. It is a huge project and we hope to link the GCC together with that project.
We are putting a lot of effort in having roads that connect us with neighboring countries. We are very well linked with the United Arab Emirates through different roads. We are looking to link Oman with Saudi Arabia through a very strategic road between the two countries as well. The Oman part has actually been completed and it is ready, we are now waiting for Saudi Arabia to finish their part. We are also linked with Yemen.
Also, there are daily flights between the GCC countries, but we are relying a lot on the railways to make the biggest change. It is going to be a new era in our transportation sector.
The Telecommunications sector is also under the umbrella of your Ministry. Oman has seen massive growth in ICT since the beginning of the century; what major developments would you point out?
Our ministry is in charge of the general policies and strategies in the telecommunications sector in Oman. The Telecommunications Regulatory Authority (TRA) takes care of the regulation for operators and implements all the policies and strategies set up by the Ministry. We have different operators that provide services to the country. There are two major telecoms operators – Omantel and Nawras. However, after signing the Free Trade Agreement we started an open market strategy and we are trying to introduce more operators. This is an on-going process and our goal is to improve the telecoms sector and provide better services to the end-users.
The major development that we are looking at in the next 5 to 8 years is the broadband side of telecoms. We would like to have a broadband network in every house in Oman. We have hired a well-known international consultant and we are currently working on a strategy to wire up the whole of Oman with broadband. It is a very ambitious and costly project, but once we come up with the strategy, it will be discussed by the Cabinet of Ministers and we hope it will be approved.
What incentives are you putting in place to stimulate investment in the broadband network? Are you looking for public-private partnerships or will the Government bare most of the cost?
Right now we are just presenting the strategy, we are not discussing the financial part of it as of yet. However we are looking at how much it will cost us, which is a lot, as our studies indicate. We will present it to the Cabinet of Ministers for discussion on how to finance the project. Once we have the infrastructure in place, service providers will come into the picture and they will buy the services as a wholesale from the broadband company that we are planning to establish for this purpose.
What progress has been made in the implementation of the e-Government initiative to date?
We have developed very good e-Government services all over the ministries. The Information Technology Authority (ITA) has made a lot of progress. They have won international awards for their efforts. We have portals for almost all the ministries and they are linking the ministries and all the staff among themselves. We have a Civil Services Information Database and employees can easily see their records online. For example, a teacher in a school puts all information on a portal so that parents can see information, and the same goes for the health sector.
This has been really successful, but now we have to provide fast internet access. There is no point building a very successful e-Government if the internet speed is slow. That is why we are strongly promoting broadband so that the processes can be delivered quickly. I think we will have major developments in our systems.
Oman was the first country in the Middle East to liberalize the telecom sector and introduce mobile number portability and 5 new Mobile Virtual Network Operators (MVNO). What are the main trends that you foresee in the future?
We had two additional applications in 2011. The first applicant has been given a permit with international gateway for international calls. However, they do not have the full license. The second operator has applied for a fixed line license in the Muscat region and I think they have been given the approval.
Recently, the Cabinet of Ministers has asked the TRA to study the market and provide their recommendations for a full third operator. They have 10 months to study the market and find ways to introduce new operators. The market is still not saturated. There is strong demand from the public to introduce a third operator to increase competition, improve services and reduce prices. Some remote areas do not have mobile services and we have to find a way of changing this. The two operators are now evaluating the tenders for 4G technology and I think it will be implemented during 2012.
You lived and studied in the United States. Could you comment on Oman’s international perception? How do you think awareness can be increased with regard to the economic and tourism potential of the country?
Oman is a great tourism destination, but we are a bit behind when it comes to marketing and we need to work harder on this area. Oman is such a beautiful country, but many people around the world are not aware of this. We have to improve our marketing strategy and media presence outside.
The economic side is also very important. There are certain unique things in Oman that encourage investors to come to us. The country is very transparent. Our 8th Five Year Economic Plan has been set out in great details, so investors can see our strategy for the next five years which this is a unique thing. As a result investors can decide if they want to stay for longer or not. We also have a central Tender Board that puts everything online and there is transparency when it comes to submitting and evaluating tenders. We put all the prices available online and this is very encouraging for investors.
We have a very steady approach in our development; we do not jump without looking at the consequences. Investors always look for steady growth rather than very fast growth. The general environment in Oman in terms of the volume of the development projects, the transparency, the tendering system and the workforce all support this. This should be presented to investors in the best possible way. Some people come over here and they like the country so they tell their friends and relatives and the news spread in this way. But we need to develop a major marketing strategy and we have to think about it at a very high level.
As Minister of Transport and Communications, how would you assess the relations between Oman and the United States? Where would you like to see increased cooperation between the two countries?
I think the relations are really good. Many people in Oman have lived or studied in the US and we all enjoyed our time there. Many of our young people are benefiting from the great universities in America. Also, politics-wise, Oman has a very good relationship with the US.
When it comes to increased cooperation, we are mainly looking at knowledge transfer. There are very high-tech activities in the US, like the state-of-the-art technologies in manufacturing and we would like Americans to support us with knowledge transfer.
In terms of education and training, I would say that America is a leading country in this regard. Our graduates definitely need training and specialized education in the new infrastructure systems we have here. We also have big American construction companies and consultants that are working in Oman.
The recently ratified US-Oman Free Trade Agreement (FTA) provides great opportunities to increase and boost trade between the two countries. We would like to benefit more from Oman’s strategic location. We also want to see more benefits from our ambitious infrastructure plan after investing so much money and effort in it. Now that we have the FTA, we also need to capitalize on the good relations we have with our neighboring countries.
Oman has traditionally been and always will be a very peaceful country. It is a good place for people to live in and it has a very friendly atmosphere. We welcome all visitors to Oman either for tourism, or for exploring business opportunities. We welcome all companies, especially advanced companies to come and transfer their know-how, and benefit from the FTA we have and the great opportunities that will be coming up in the next 10 years. I am sure all of them will like Oman once they come here.