OMAN

Basic Russian exports include metallurgy and mechanical engineering products, Russian imports--re-exported cars and electronic goods.

The Caspian Pipeline Consortium is a major joint project in which Russia and Oman are involved. The total amount invested in the project by the Oman government is in excess of US million. Alongside Oman and Russia, Kazakhstan and a number of transnational oil companies participate in the project. A regular annual meeting of the Board of Directors and an extraordinary shareholders meeting were held in Muscat on March 17 and 18, 1998. The Russian side was represented by first deputy minister of fuel and power V.I. Ott and representatives of the Rosneft and Lukoil companies. The delegation of Oman was represented by M. Sultan, minister of trade and industry and president of the Oman Oil Company, and minister of economic affairs A. Mekki. Spokesmen of the Kazakhstan National Oil Company also took part in the meeting.

The so-called Silicon Project is another promising joint undertaking. It envisages export to Oman of Russian technologies for the production and processing of local quartzites, i.e. a venture is to be created in Oman to produce metallic silicon for semiconductors. It also provides for Oman investing in the Russian industry, including in conversion projects. As a matter of fact, the Silicon Project for the first time provides a tangible opportunity for Russia to enter the high-tech market not just in Oman but also in the Gulf area as a whole.

Russian companies provide technical assistance in the development of the Oman cement industry. Negotiations were held on Stroitransgaz company's participation in the construction of gas mainlines. The Oman side shows interest in cooperation in agriculture, fishery and fish processing.

The outstanding problem of dual taxation remains one of the key obstacles to the development of trade and other economic relations between Russia and Oman. A pertinent intergovernmental agreement ratified by the parties back in 1996 could have encouraged the formation of joint ventures, but it has not been signed yet.

Consultations on the establishment of a direct air route between the two countries were held in Muscat in February 1998. The Oman side expressed its willingness to grant Aeroflot most favoured nation treatment at the Sib airport in Muscat. This involves special rates for air navigation, technical and engineering services. Commercial issues of organising such air flights were discussed at the talks with the Oman Aviation company management. Moscow-Dubai-Muscat-Dubai-Moscow TU 154 flights twice a week were considered as a possible arrangement.

The Oil and Gas West Asia international exhibition, Muscat, March 8-12, 1998. Participants in the exhibition, organised by OmanExpo LLC (project manager Suleiman Al-Harsi) at the Oman international exhibition centre (Sib), included Elf and Total (France), Amoko (the USA), Shell (Holland) and other companies. The Austrian and Dutch embassies arranged their own displays. Russia was represented by the ministry of economic affairs, Rumo works from Nizhny Novgorod and the Khanty-Mansiiskgeofizika association.

The equipment displayed showed that British and US technologies dominating the Oman market are lagging 10 to 15 years behind state of the art standards. Russian highly productive technologies in the field of processing oil heavy fractions which Oman is exporting may be applied in Oman. Given the limited reserves of hydrocarbons, deep oil refining is of great significance to Oman. The research centre of the Sultan Kabus University is willing to establish partnership contacts with Russia in this field. However, the Oman side is insufficiently informed of Russian achievements and therefore its interest has not yet been actualised in specific joint projects.