Oman, Malaysia ink trade and investment MoUIskandar Malaysia
MUSCAT — Oman and Malaysia have taken another step forward in furthering bilateral ties.
A memorandum of understanding (MoU) on bilateral trade and investment was inked yesterday between AMS Engineering SDN BHD, Malaysia, represented by AB Malik Shahir, managing director; and Prosper Management Consultancy, Oman, represented by Kalfan Al Esry, co-founder and CEO; marking the beginning of broader trade and investment between the two countries.
A large delegation of trade and investment representatives from both the countries was present at the signing ceremony and the subsequent seminar on Malaysia-Oman business opportunities.
While the Malaysian side was led by Dato Seri Rafidah Aziz, Malaysian minister of international trade and industry; Oman was represented by Maqbool bin Ali Sultan, minister of commerce and industry and Khalil bin Abdullah Al Khonji, chairman of Oman Chamber of Commerce and Industry.
Also present on the occasion were His Highness Khalifa bin Taimur Al Said, chairman and CEO of Radiance International and Dato Mohd Zamri Mohd Kassim, Malaysian ambassador to the Sultanate.
“This is my first trade and investment mission for the year.
“We have come to West Asia because Malaysia believes there is much potential for developing bilateral trade and investment engagement with the countries in the Middle East, specifically with Oman,” said Malaysian minister Rafidah Aziz.
“Oman is Malaysia’s third largest trading partner among members of the Arab Gulf Cooperation Council. The total trade between the two countries grew from $28.1 million in 1995 to $1.06 billion in 2006.
During this period, Malaysia’s exports to Oman increased from $26.4 million to $108 million and imports expanded from $1.7 million to $956 million,” she added.
Maqbool said Oman and Malaysia could cooperate bilaterally in several sectors, including oil and gas, tourism, construction, trade, HRD and knowledge economy.
“I firmly believe that the possibilities of cooperation and collaboration in various socio-economic sectors of Oman and Malaysia are immense. We have to have a vision and commitment to turn these possibilities into reality,” he added.
The seminar served to highlight Malaysia’s capabilities in supplying a wide range of products and services, promote Malaysia as a profitable investment location in the Asean region and enable the business community of both the countries to network and explore business opportunities. It also served to explore and expand trade and investment opportunities for Malaysian products and services in the Sultanate and take a look at alternative and more competitive sources of imports.
“Malaysia offers incentives to investors, like 100 per cent foreign equity, exemption from corporate income tax for 10 years, exemption from withholding tax on royalty and technical fees for 10 years, and freedom to source capital globally,” Rafidah Aziz said.
“Oman provides a host of benefits for investors, like ease of tax, custom duties, subsidies on rent, power etc. in the industrial areas, besides certain investment-friendly loans. In fact, Oman and Malaysia are working on the same wavelength as far as incentives to investors are concerned,” said Maqbool.
Malaysia is an industrialised nation with an open economy, and has established trade relations with more than 200 countries of the world. In the year 2006, Malaysia’s total external trade amounted to $291.6 billion.
For the first 11 months of 2007, the total trade was $292.1 billion. Apart from tax incentives, Malaysia is a prime location for foreign investment, due to a sound legal system which is largely based on the British legal system, excellent infrastructure, availability of a large, skilled workforce and a stable political and economic environment. To secure Malaysia’s position as a strong economy in the region, the government has taken the initiative to designate a unique investment area known as the Iskandar Development Region (Iskandar), aims at providing a range of fiscal and other incentives to spearhead the growth of the economy and attract FDI. The Iskandar concept is the first of its kind in Malaysia and is designed to take the economy to new heights.
Malaysia’s major exports to Oman in 2006 were palm oil (32.8 per cent), manufactures of metal (14 per cent), machinery, appliances and parts (11.9 per cent), electrical and electronics products (8.5 per cent), iron and steel products (8.3 products) and processed food (6 per cent). The major imports from Oman were crude petroleum (99.7 per cent) and non-metallic mineral products (0.1 per cent).
Though the volume of trade between Oman and Malaysia is increasing, it makes up for only 0.3 per cent of Malaysia’s total trade. Exports to Oman account only for less than one per cent of Malaysia’s total exports. There are, however, immense opportunities for Omani companies to source for more products and services from Malaysia. In this context, the seminar provided an important platform to explore trade, commerce and investment opportunities between Malaysia and the Sultanate of Oman.