ME FIRST

Oman 2015 | ENERGY & UTILITIES | FOCUS: IN-COUNTRY VALUE

A campaign is underway to see more of the investment made in Oman benefit the country directly.

In-country value (ICV) is defined as the total spend retained in country that benefits business development, contributes to human capability development, and stimulates productivity in Oman's economy. Stable economic growth and the development of the local human capital are the key elements underpinning the ambitious Vision 2020.

ICV became a priority for the Sultanate when the Ministry of Oil and Gas officially created an ICV committee. Grouping and creating a balanced synergy between government representatives and executives from the oil and gas sector is a pillar of this new strategy, which aims to sustain the country's stable growth pattern.

ICV initiatives are active in several areas, such as workforce development, increasing the local sourcing of goods and services, and enhancing Oman's environment to foster the development of local businesses and, consequently, FDI.

ICV does not just fall within the oil and gas sector's purview, it is also pursued by the industry sector; part of the initiatives that have recently been launched in the Sultanate include the implementation of a joint supplier and joint registration system, the standardization and inclusion of ICV in tenders, and a reporting and monitoring system.

Today in Oman, ICV is not only a national strategy, but also a motto adopted by the most iconic companies operating in the country. Since its inception, back in the 1970s, Petroleum Development Oman (PDO) has been hiring, training, supporting, and investing in Oman, anticipating the ICV strategy that has now became firmly embedded in the company's business philosophy, aiming to promote the Omanization of skilled contractor personnel and an increase in the procurement of Omani goods and services within the country. In that regard, Raoul Restucci, Managing Director of PDO, commented in 2011 that “under the auspices of the Ministry of Oil and Gas, we received full support for our ICV strategy, which has since become the industry's roadmap, and the ICV acronym is now used as a common term across every engagement." PDO, together with the Ministry of Oil and Gas, the Oman Society for Petroleum Services (OPAL), and other operators reviewed 53 categories amounting to more than $100 billion worth of investments by 2020. In 2011, Oman's oil giant set a target to create 1,000 jobs per year covering the manufacture and servicing of goods: to date, it has exceeded this target by a factor of four.

Many local industries are supporting the ICV strategy. The development of locally produced materials, products, and equipment through increased value-added processes, the introduction of new technologies, and the growth of Oman's exports are driving the consolidation of several local companies. Oman Cables Industry is a paradigm for the application of ICV principles, with continuous innovation and a focus on operational excellence being at the core of its activity. Today, the company exports about 60% of its production, so it is not limited to the Omani market. Oman Cables Industry manages its industrial processes, applying best practices in all fields. According to the ICV strategy, that is the best way to actively support the industrialization of the country.

The major challenge, both for the oil and gas and industry segments of the national economy, is related to human capital. Increasing competency levels and the productivity of the local workforce and shaping intellectual capital to drive performance in technical professions by setting up training programs for long-term development remain the real priority, and real pillar of the ICV strategy.