Oman is following in the steps of its Gulf Cooperation Council (GCC) neighbours by turning its focus to building a nationwide tech startup ecosystem.

The Gulf state has already laid strong foundations for the development of its tech credentials with its overarching policy vision, dubbed 2030 Digital Oman Strategy, or eOman.

A significant achievement of eOman was the earmarking of $200m from the country’s sovereign wealth fund, the Oman Investment Fund, to create the Oman Technology Fund in 2016.

The fund invests in startups in Oman and attracts global startups to open up shop in the country through partnerships with global leaders such as London-headquartered venture capital (VC) firm Hambro Perks. The fund is expected to attract technology companies to Oman and help build the country as a tech hub.

The Omani government also established a $15m seed stage programme in 2017, known as Wadi Accelerator, and has launched a VC firm which invests in disruptive and innovative solutions to address real-world challenges.

“While the development of Oman’s startup ecosystem has trailed its neighbours, such as Saudi Arabia and the United Arab Emirates, Oman is increasingly building the institutional foundations and addressing funding gaps which remain challenges to its entrepreneurship ecosystem and others across the MENA [Middle East and North Africa] region,” said Wes Schwalje, chief operating officer of Dubai-based research firm Tahseen Consulting.

Youth job creation

Schwalje said a robust, self-sustaining entrepreneurship ecosystem was not just a passing priority for Oman, but a necessity to realise the aspirations of Vision 2040 to create more high-skill, high-wage jobs in knowledge-based industries for youth.

With a youth unemployment rate of nearly 50%, according to the World Bank, jobs for youths is a key policy priority.

“To its credit, Oman was a first mover within the GCC in terms of seeing the importance of developing a strong technical and vocational education system and integrating technology skills into the national curricula,” said Schwalje.

“One sign that this is having a significant impact is that Omani youth have consistently performed well in Microsoft’s global Imagine Cup competition over the past several years.”

He added that Oman was cultivating a young generation of “tech-savvy critical thinkers” who can realise opportunity gaps in markets and fill them.

“From a demographic perspective, Oman, and its GCC neighbours, have young, digitally connected consumers with some of the highest mobile penetration rates in the world, which bodes well for the development of the digital economy in the GCC and across the MENA,” said Schwalje.

Growing the ecosystem

Salim Sultan Al-Ruzaiqi, CEO of Oman’s Information Technology Authority (ITA), said the ICT industry ecosystem was a “driver of economic and social growth in any nation”.

“We are determined to further develop and innovate to adopt the latest systems and the best practices to leverage the digital boom in boosting development and progress in the sultanate,” said Al-Ruzaiqi in the 2018 ITA annual report.

“We need to make sure we benefit from the promising potential of emerging technologies. We must take the initiative to automate our services and utilise technologies such as artificial intelligence, the internet of things and blockchain to enhance performance and productivity,” he added.

There are still significant underexploited opportunities in Oman. It has been slow to move on key tech policies related to emerging tech and new business models, such as ride sharing and home sharing, but Tahseen Consulting’s Schwalje said there was room for growth in areas such as the fourth industrial revolution (4IR) technologies applied to traditionally strong sectors, such as using artificial intelligence in the oil and gas sector.

Policy formulation

However, Schwalje said Oman’s government needed to speed up the formulation of foundational digital economy policies, like personal data privacy and VAT, to give regional and global tech companies the market confidence they need to invest for the long term.

“We will see Oman rapidly learn from its neighbours to become one of several tech startup hubs in the region”
Wes Schwalje, Tahseen Consulting

“There is significant interest from global tech companies in Oman – for example, Airbnb chose Oman as one of its initial global launch markets for its Adventures launch. However, Oman still remains an afterthought for most MENA entrepreneurs and global tech companies,” said Schwalje.

“In addition to reconsidering its approach to the enabling policies for the growth of the digital economy, Oman will need to do something big and bold – like The Future Investment Initiative in Saudi Arabia or the Sharjah Entrepreneurship Festival in the UAE – to change this perception and earn its rightful place on the map as an emerging startup hub,” said Schwalije.

He believes increased regional competition to improve startup and entrepreneurship ecosystems is pushing Oman towards a “fast follower” approach.

“We will see Oman rapidly learn from its neighbours to become one of several tech startup hubs in the region. We are really going to see competition between aspiring MENA startup hubs heat up in the next few years, particularly in the GCC, which will lead to an unprecedented rate of reform.



READ SOURCE

READ  Fuel Tech Reports 2018 Second Quarter Financial Results

WHAT YOUR THOUGHTS

Please enter your comment!
Please enter your name here