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Market Alert on Development of ICT Industry in Oman and Qatar
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  • 1. MARKET ALERT ON DEVELOPMENT OF ICT INDUSTRY IN OMAN Oman in Brief Capital: Muscat Land area: 309,500 sq. km (bordering UAE, Yemen, KSA) Population (2009 est.): 3.4 million including expatriates GDP Per Capita (2009 est.): US$23,900 Real GDP growth (2009 est.): 2.7% Consumer Price Inflation (2009 est.): 5.3% Principal growth sector: Manufacturing, tourism, agriculture and petroleum Currency: USD = 0.3845 Omani Riyal Exports: $29.34 billion (2009 est.) Major Exports: petroleum, fish, metals, textiles Major Export destinations: China 31.7%, South Korea 17%, UAE 11.7%, Japan 11%, Thailand 7.1% (2009) Imports: $18.41 billion (2009 est.) Major Imports: machinery and transport equipment, manufactured goods, food, livestock, lubricants Major Imports sources: UAE 27.2%, Japan 15.6%, US 5.7%, China 4.6%, India 4.5%, South Korea 4.2%, Germany 4.2% (2009) Oman’s ICT Market: The Omani authorities have made a significant push in recent years to improve their e-government offering, including the creation of an internet portal for government services and, most recently, the inauguration of the Sultanate's first cyber centre. The facility, based in Muscat, and known as the Oman National Computer Emergency Readiness Team (CERT), was opened 1
  • 2. earlier in April 2010 to provide the Sultanate with enhanced security for its information assets, as well as coordinating emergency responses to incidents relating to the internet. Internet penetration in Oman continues to remain relatively low. According to Internet World Stats, an online agency which monitors global internet penetration statistics, Oman had 557,000 internet subscribers in September 2009, representing a penetration rate of 16.3%. By comparison, the current average penetration rate for the Middle East is 28.8%. One reason for the relatively low figure is Oman's widely dispersed population, which naturally presents a challenge for telecoms providers. However, developments in both technology and market organisation look set to gradually overcome this through the use of 3G and WiMAX. Recently Oman has introduced another Fixed Line Operator called Nawras. Nawras is currently in the process of laying 5000 km of fibre-optic cables and hopes to serve 81% of the population by next year. Nawras, a joint venture involving Qatar's QTel, Danish firm TDC and several local partners, has been a mobile service provider since 2005 and hopes to enhance the market offering of integrated telecoms services in Oman, as well as developing the wholesale market through resellers and partnerships. The company will also be using WiMAX for its fixed services. 2
  • 3. The ICT market in Oman will continue to see a growth in demand for new technology and Additional services. A recent market report predicted that demand for consumer electronics in Oman will grow from US$487 million this year to US$600 million by 2014, with computer hardware (representing 36% of the market) expected to grow at a compound annual growth rate of 6% during that period. The market for mobile handsets, which are also becoming a popular method of accessing the internet, is expected to reach over US$200 million by 2014, with mobile penetration hitting 174.3%. Strong figures such as these points to a continued healthy future for Oman's IT sector. Prepared by: MATRADE Dubai – July 2010 3
  • 4. MARKET ALERT ON DEVELOPMENT OF ICT INDUSTRY IN QATAR Qatar in Brief Capital: Doha Area: 11,520 km2 (Over 560 km of coastline with over 200km of beaches) Population: 840,000 (2009 est) GDP: US$93.63 billion (2009) GDP growth rate (2009): 9.5% Per capita income (2009): US$121,700 Inflation rate (2009): -3.9% Exports: $37.43 billion (2009 est.) Major Exports: liquefied natural gas (LNG), petroleum products, fertilizers, steel Major Export destinations: Japan 38.3%, South Korea 20.8%, Singapore 11.1%, India 4.6%, Thailand 4.3% (2009) Imports: $20.87 billion (2009 est.) Major Imports: machinery and transport equipment, food, chemicals Major Import sources: US 12%, Germany 8.9%, Italy 8.8%, Japan 7.9%, South Korea 7.4%, France 6.2%, UAE 5.4%, UK 4.9%, Saudi Arabia 4.6%, Turkey 4.2%, China 4.2% (2009) Qatar’s ICT Market The telecoms sector is set for major change in 2010 as a new operator, Vodafone, enters both the fixed-line and mobile market, ending the monopoly of Qatar Telecom (Qtel). While the 4
  • 5. sector has witnessed exuberant growth over past years, the entrance of Vodafone is expected to stimulate new opportunities for both providers and customers as competition heats up. Mobile penetration in Qatar is high, even regional standard, standing at about 150% in 2008, while fixed-line remains relatively low, at just under 30% at the end of 2008. But the fixed- line data service segment has grown rapidly, with broadband take-up growing by 50% year-on-year in 2008. Vodafone will invest heavily to make its mark in the Qatari market. It seems likely both operators will begin to look to added-value services over the coming years, bringing new products to a technology-hungry market. The effects of the financial crisis on the sector so far is non-existent. Added competition in the market should result in investment in product development and customer service through adopting to latest technology. The rapidly expanding non-hydrocarbons sector of the economy is fuelling growth in IT services and the government is determined on rolling out further IT infrastructure in a bid to establish Qatar as a leading knowledge-based economy. Development and high spending in health and education systems as well as the financial services and communications sector have boosted growth in the IT industry as firms, both public and private, seek technical services and solutions. 5
  • 6. Government support is led by the Supreme Council of Information and Communication Technology (ictQATAR), which, under its master plan for Qatar’s ICT sector is working on a series of targets and benchmarks for improving information and communications technology (ICT) appropriation in the country at large. The plan will enable the government to fully implement its e-government strategy, with a target of 80% of all public services online by the third quarter of 2010. The government is pushing ahead on the IT research and development fronts through the recently inaugurated Qatar Science & Technology Park (QSTP), which has already attracted leading international firms like Cisco and will host the Qatar Robotics Surgery Centre, due to launch in the second half of 2009. With government commitment and economic development to fuel demand, the future looks bright for the Qatari IT sector. Prepared by: MATRADE Dubai – July 2010 6