Trading activities, fishing, and the oil sector have been considered key segments of Oman’s economy. In 1964, oil was discovered in Oman which triggered an increase in export and production (Alraja et al., 2021). Currently, Oman’s regime has introduced new strategies to diversify away from oil under its Oman policies and privatization. Oman was selected for study application due to its modernized economy. Despite the application and maintenance of the rule of law, Oman’s judiciary has remained vulnerable to political interference. The state involvement in the private sector has remained constrained by overall economic freedom (Muthuraman et al., 2021). Studying Oman’s entrepreneurship through the exploration of SMEs will allow the development of strategies to help the regime to diversify the economy by supporting small manufacturing enterprises. Notably, Oman’s regulatory setting is considered to be evolving. The labor policies enforce the Oman strategy that necessitates private-sector firms to meet the quota for hiring native Omani workers (Alraja et al., 2021). Oman was selected for the study since they do not focus on the private sector which would significantly boost their economy. Incorporating private sectors in industries such as manufacturing is linked with the creation of job opportunities and economic boosts. Thus, exploring Oman will allow us to view the significance of private sectors such as SMEs and ways the SMEs will significantly boost the economy through presenting opportunities such as opportunities in labor and an effective manufacturing process.
According to Muthuraman et al. (2021), Oman Vision 2040 is considered the sultanate’s gateway to curb challenges and keep pace with global and regional variations. The vision is aimed at generating and seizing opportunities to foster both economic attractiveness and social well-being triggering growth. Promoting SME development is one way that the country can reduce its reliance on oil and gas. Oman’s focus is aimed at economic programs to advance the business environment and trigger investments. In addition, the regime aims at introducing social safety net that will curb the impact of economic variation on low-income families (Muthuraman et al., 2021). Selecting Oman to be applied in the study will allow the development of a different standpoint on the private sector such as small manufacturing enterprises which has been ignored where the sector can induce economic changes in low-income families by venturing into the sector. Oman’s main source of income is oil and gas, accounting for over 80% of the country’s total income (Alraja et al., 2021). Nearly all of the country’s development initiatives, including those focused on SMEs, rely on oil and gas revenue. Therefore, exploring SMEs in Oman will allow a strong focus on the significance of SMEs in boosting a country’s economy through the creation of job opportunities and adapting to new technologies.
In 2023, Oman’s unemployment rate has increased to 3.70%; the increase in unemployment levels makes the country favorable for the study since the incorporation of SMEs will curb the problem through the introduction of new opportunities in labor (Muthuraman et al., 2021). Studying Oman’s manufacturing instigates a clear view of ways the industry presents diverse opportunities such as labor since the industry consists of diverse sections that are critical to its success. SMEs can create opportunities in the labor market and boosts economic development. Choosing Oman manufacturing for the study derives the importance of SMEs in boosting the economy of a developing country through exploring SMEs’ features such as their adaptability to new technologies which allow greater and more efficient manufacturing processes. SMEs account for 90% of all economic enterprises in Oman. However, according to Alraja et al., (2021), despite SMEs employing more than 40% of the total workforce, fewer than 8% of its workers are Omani citizens. Therefore, studying Oman will allow the regime to formalize informal sections of the SME sector by simplification and promotion of business start-up strategies. It triggers diverse people such as youth to boost their confidence to formally engage and register their business ventures.
Widely, many governments invest heavily in their manufacturing sector to ensure that the sector properly serves its vital functions, in most cases providing infrastructure, rules, regulations, support, and supervision to enhance the sector’s strength and stability. The Omani manufacturing industry has grown slowly. Over the last 60 years, the sector has increased its contribution to the GDP from 0.8% to 9.9%. However, according to Alraja et al., (2021) since the start of the 2000s, the industry has experienced accelerated growth, becoming a key driver of Omani economic development. Oman was selected for study due to the deteriorating levels in the manufacturing industries. Exploration of the manufacturing sector in Oman through the integration of SMEs supported by Omani’s regime will provide an efficient solution to the manufacturing sector. Choosing Omani manufacturing as an SME focus for the study reveals the urge to incubate SME innovation by tapping into present technological trends and improvements. Large firms rely on SMEs to support and sustain them by providing products, services, and suppliers, which are necessary to remain competitive (Muthuraman et al., 2021). Oman’s manufacturing in SMEs allows us to view the significance of promoting market access for SMEs at both international and local heights. It can be achieved through surpassing unfair rivalry from cheap imports which progress to curb the advancement of the SME sector.
In Oman, regulations and administrative burdens are major concerns among SMEs (Muthuraman et al., 2021). Most state regulations are designed to encourage direct investment rather than to boost SME growth. To ensure proper competition among SMEs in Oman, it is necessary to develop a full understanding of the limited resources available to SMEs, which exacerbates the burden of such state regulations. Choosing Oman manufacturing as an SME focus of the study reveals the urge to incubate SME innovation by tapping into present technological trends and improvements. Omani’s manufacturing industry facilitates in revealing diverse ways that SMEs are vital and yearn for government involvement to offer their support. The support comprises developing and implementing strategies that can aid SMEs counter financial complications (Alraja et al., 2021). Choosing Omani manufacturing as a focus for SMEs as the study reveals its significance which creates the urge for diverse governments to create and monitor pro-SME policies. The process can be achieved through the formalization of informal sections of the SME sector by simplification and promotion of business start-up strategies. It triggers diverse people such as youth to boost their confidence to formally engage and register their business ventures.
Why Manufacturing Was Chosen For SME Focus
Comprehensively, the manufacturing industry engages creation of new products which significantly affect a country’s economy (Gualtieri et al., 2020). Manufacturing industries are vital in advancing a country’s economy as they employ a big impact on the labor force and create materials needed by diverse sectors of strategic significance such as national infrastructure. Consequently, in promoting economic growth and facilitating national economic competitiveness, SMEs are effectively the machine that controls economic and social regeneration. Choosing manufacturing as a focus on the SMEs allows an understanding of ways the manufacturing process creates diverse opportunities for a country through the incorporation of SMEs as a triggering tool of economic development. Studying manufacturing instigates a clear view of ways the industry presents diverse opportunities such as labor since the industry consists of diverse sections that are critical to its success. SMEs can create opportunities in the labor market and boosts economic development (Alqassabi, 2020). Exploring the manufacturing industry creates a standpoint on the significance of SMEs since they can respond relatively quickly to shifts in the business environment, enabling rapid adaptation and innovation. Thus, choosing to manufacture derives the importance of SMEs in boosting the economy of a developing country through exploring SMEs’ features such as their adaptability to new technologies which allow greater and more efficient manufacturing processes.
On many occasions, the driving force for economic growth is small and medium-sized enterprises in the manufacturing sector. SMEs are considered the manufacturers and suppliers of finished commodities. The manufacturing process is facilitated by SMEs in diverse places. Currently, SMEs are considered the sector that is consistently growing in comparison to other sectors in the world (Alqassabi, 2020). Thus, choosing manufacturing as the focus will deliver a crystal view of the importance of SMEs in preparing finished commodities and supplying inputs to diverse heavy industries. SMEs can adapt to new variations and trends that hit diverse markets; thus, exploring the manufacturing industry will allow us to view the impacts of SMEs in balancing and improving the economy. The production procedure is considered as varying sectors that are shaped according to an SME; however, there is the requirement of heavy industries and customization of the complete assembly line (Gualtieri et al., 2020). Therefore, SMEs can significantly introduce new commodities in the market and continue with the manufacturing process. Therefore, choosing manufacturing as a focus for the SMEs might create attention to diverse regimes on ensuring the support of small manufacturing industries due to their effect on a country’s economy.
Widely, labor and overhead costs in small manufacturing enterprises are less significant which triggers better rates of operations (Gualtieri et al., 2020). When a particular action is not conducted well by a designated SME, the service can be substituted with another which is not likely in large-scale enterprises. The availability of options allows for easy substitution of services provided by small manufacturing enterprises (Alqassabi, 2020). On many occasions, the manufacturing industry is affected by the introduction of new technology; therefore, SMEs allow easy adoption of new technology which ensures the smooth th running of the manufacturing process. Therefore, choosing manufacturing as a focus on the SMEs allows for analysis of the importance of SMEs in adapting to new technologies. The manufacturing industry is considered to trigger a significant influence on the improvement of an economy; therefore, a platform that addresses the needs of the manufacturing industry is beneficial (Alqassabi, 2020). Focusing on the manufacturing industry confirms that the emergency of SMEs is a significant emblem of a developing and developed economy. In addition, choosing manufacturing as a focus on the SMEs displays the status of the small manufacturing enterprises such as the enterprises can come together and collaborate to accomplish their requirements of industrial consulting and supplies.
The absorption of diverse swaths of workers and places into decent-paying jobs and productivity is a key benefit of manufacturing (Gualtieri et al., 2020). Manufacturing is linked with opening avenues of new schemes through innovating firm value chains to support key production. In employment creation, SMEs are considered to act a vital part in integrating innovation. Notably, diverse small businesses are considered a significant section of the huge informal economy that delivers solutions to short-term challenges (Alqassabi, 2020). Choosing manufacturing as a focus for SMEs reveals its significance which creates the urge for diverse governments to create and monitor pro-SME policies. The process can be achieved through the formalization of informal sections of the SME sector by simplification and promotion of business start-up strategies. It triggers diverse people such as youth to boost their confidence to formally engage and register their business ventures. The manufacturing industry facilitates in revealing diverse ways that SMEs are vital and yearns for government involvement to offer their support. The support comprises developing and implementing strategies that can aid SMEs counter financial complications (Alqassabi, 2020). Diverse financial institutions avoid lending to SMEs since they are termed high-risk ventures due to their deficiency in tangible assets that can be considered as security or collateral. However, the impediment can be avoided through the adoption of the subcontracting policy.
Choosing manufacturing as an SME focus reveals the urge to incubate SME innovation by tapping into present technological trends and improvements (Alqassabi, 2020). Large firms rely on SMEs to support and sustain them by providing products, services, and suppliers, which are necessary to remain competitive. Currently, technology is considered to possess the capability of expanding markets by providing chances for local markets to compete globally. SMEs provide opportunities for individuals and entrepreneurs who prefer to work for themselves or have no chance to work with others to launch their outlets. Thus, manufacturing allows us to view the capability of SMEs by allowing them to hit new-fangled and developing markets available through present technological tendencies such as online markets. Manufacturing in SMEs allows us to view the significance of promoting market access of SMEs at both international and local heights (Gualtieri et al., 2020). It can be achieved through surpassing unfair rivalry from cheap imports which progress to curb the advancement of the SME sector. SMEs usually offer raw materials ranging from spare parts to manufacturing schemes. SMEs are considered significant contributors to manufacturing firms, especially in developing countries (Alqassabi, 2020). Therefore, choosing manufacturing as the focus of the SMEs allows an understanding of ways the manufacturing process creates diverse opportunities for a country through the incorporation of SMEs as a triggering tool of economic development.
References
Alqassabi, M. A. (2020). Insights on the sustainability of small and medium enterprises in Oman: a conceptual framework. International Journal of Economics and Financial Issues, 10(1), 209-218. https://www.academia.edu/download/70209527/pdf.pdf
Alraja, M. N., Hussein, M. A., & Ahmed, H. M. S. (2021). What affects the digitalization process in developing economies? Evidence from the SME sector in Oman. Bulletin of Electrical Engineering and Informatics, 10(1), 441-448. https://beei.org/index.php/EEI/article/download/2033/1909
Gualtieri, L., Palomba, I., Wehrle, E. J., & Vidoni, R. (2020). The opportunities and challenges of SME manufacturing automation: safety and ergonomics in human–robot collaboration. Industry 4.0 for SMEs: Challenges, opportunities and requirements, 105-144. https://library.oapen.org/bitstream/handle/20.500.12657/22857/1/1007304.pdf#page=133
Muthuraman, S., Al Haziazi, M., Veerasamy, R., & Al Yahyaei, N. (2021). SME–Key Drivers for Economic Development in the Sultanate of Oman. Exploring Sustainable Paths, 35. https://www.researchgate.net/profile/Kabaly-Subramanian/publication/354239064_Digital_Technologies_in_Higher_Education_Institutions/links/612e19c638818c2eaf70857e/Digital-Technologies-in-Higher-Education-Institutions.pdf#page=66
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