Monday, December 5, 2022

“Value of Iran Exports to Oman can be doubled in years”

Forecasts suggest that the value of exports from the Islamic Republic of Iran to the Kingdom of Oman can be at least doubled and at most increased five-fold within 5 years. It is estimated that Iran can raise the value of direct and indirect imports from Oman to $1 billion during that time.

The level of relations between the Islamic Republic of Iran and the Sultanate of Oman

Iran exported about $720 million worth of commodities to Oman and imported about $620 million from the Sultanate.

In total, the value of bilateral trade between the Islamic Republic of Iran and the Kingdom of Oman was about $1.4 billion, but given the fact that the two neighboring countries cooperate in other fields such as tourism and joint investment, and part of the trade with Oman is carried out through other countries, including the United Arab Emirates, the real value of trade between the two countries exceeds $1.4 billion.

Expected Level of Trade between Iran and Oman

Forecasts show that the value of exports from the Islamic Republic of Iran to the Kingdom of Oman can be at least doubled and at most increased five-fold within a 5-year process. It is estimated that Iran can raise the value of direct and indirect imports from Oman to $1 billion in 5 years.

Weak points

Unfamiliarity of Iranian exporters with the details and conditions of the consumer markets in Oman are deemed as the main drawback for the expansion of trade ties between Iran and Oman. Also, lack of quality as well as hygiene and packaging standards, discontinued supply of consumer market needs, weakness in marketing, market research, professional negotiation, signing contracts are among the weak points hampering Iranian businessmen’s trade with their Omani counterparts. Another major setback is the absence of the Iranian producers and exporters from Oman market which technically impede their entrance and investment and ultimately prevents market share retention.

The lack of a proper shipping fleet to transport goods to Oman ports is one of the other setbacks facing Iranian exporters. This includes not having enough refrigerated containers to carry agricultural products and perishable food.

Threats

The presence of strong competitors in the Oman market and the lack of proper banking relations between Iran and Oman, the lack of a direct shipping line between the two countries and the impossibility of the presence of Iranian ships and anchoring in Oman ports are considered as the factors threatening expansion of bilateral trade between Iran and Oman.

Strengths and opportunities in the Sultanate of Oman

Here are some of the strong points Iranian businessmen can enjoy in Oman:

Very good political relationship between Iran and Oman, close ties between the Iranian and Omani economic and trade institutions, close geographical distance and low shipping costs compared to other markets, strong cultural and religious bonds and linguistic commonalities.

Also provision or creation of bilateral trade infrastructure, operating direct flights enabling Iranian and Omani businessmen to commute regularly, abolishing visa requirements and issuing visa on arrival at the airport can further facilitate bilateral trade between Iran and Oman. Cordial relations between Iranian and Omani businessmen, simple and proper laws for living and establishing a business in Oman are also among the other benefits for the Iranian businessmen.

On the one hand, the high value of the Omani national currency against the Iranian currency can offer an opportunity for the Iranian exporters. The existence of a joint chamber of commerce (Iran-Oman Chamber of Commerce) seen as one of the most active joint trade entities in the region and the presence of Iranian and Omani trade advisers in the target countries along with active embassies interested in developing economic and trade relations between the two countries can also be considered as advantages for the Iranian exporters.

Similar consumer culture, consumption behaviors and taste, familiarity with Iranian goods, the issue of halal food produced in Iran as well as the appropriate laws of Oman supporting businesses are also among the advantages the Iranian exporters and businessmen have at their disposal.

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