The UK government is exploring opportunities to diversify its foreign direct investment (FDI) in Oman, moving beyond the country’s traditional oil and gas sectors. British Minister of State for Trade Policy and Economic Security, Douglas Alexander, recently highlighted this strategic shift during a visit to Oman.
Historically, around 96% of the UK’s FDI in Oman has been concentrated in oil and gas, Alexander noted. However, the Minister emphasised that the UK aims to build a more collaborative and diversified economic partnership with Oman. “We are shifting from a purely transactional relationship to one that is more balanced and mutually beneficial,” he stated.
One promising area of focus is renewable energy, particularly green hydrogen. Alexander praised Oman’s forward-thinking decision to create concessions and attract international partners in this field. “The potential for green hydrogen production in Oman is significant, and the government’s bold approach is a key step toward developing this industry,” he said.
The UK is also interested in tapping into Oman’s mineral and mining sector. “During our discussions, we recognized the critical importance of raw materials, which will be vital for the low-carbon economy. The future demand for minerals and the need to refine them into usable resources will transform the way resource extraction is approached in the coming decades,” Alexander remarked.
In addition to renewable energy and mining, the UK is keen to invest in Oman’s technology sector, particularly FinTech and artificial intelligence (AI). The Minister highlighted the importance of international collaboration in advancing these sectors: “No country can tackle FinTech or AI development alone. The scale of investment required means partnerships are crucial for success.”
Further strengthening trade ties is also a priority for both nations. Alexander stressed the importance of reducing barriers to trade and investment, including addressing both tariff and non-tariff obstacles. “We are committed to lowering the barriers to effective investment and trade on both sides. To achieve this, we need to closely examine the friction points that hinder economic exchange,” he added.
The Minister’s visit to Oman is part of a broader UK initiative to deepen its relationships within the Gulf Cooperation Council (GCC) as negotiations progress on a Free Trade Agreement (FTA) between the UK and the GCC.
