Oman pushes $5.2bn plan to boost small business growth

Pexels/Cedric Fauntleroy

• OR2 billion fund for SMEs
• Startup funding up 39%
• 210,000 SMEs in Oman

Oman has launched a OR2 billion ($5.2 billion) fund to encourage more investment in local small and medium-sized enterprises, as the sultanate looks to capitalise on a growth in support for startup businesses.

The funding plan by the Oman Investment Authority follows on from the announcement of the Future Fund Oman last May, which aimed to increase participation by SMEs and private companies in government activity.

Research by the venture capital firm Wamda found startups in the Gulf state raised $4.8 million in eight deals last year, a year-on-year increase of 39 percent.

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This bucks the global outlook, with the business data company Crunchbase reporting a 38 percent year-on-year drop in startup funding worldwide. Investment totalled $285 billion in 2023, the lowest since 2018.

On a regional basis, funding rose slightly, by 1.7 percent year on year to $4 billion. However, most countries, bar Oman, Saudi Arabia and Morocco, reported large falls in funding.

The UAE reported a 47 percent decline to $977 million, across 211 deals, while Qatar was down 62 percent to $14 million. In Kuwait and Bahrain, startup funding was down 52 percent and 89 percent, respectively.

One of the standout Omani deals was by Kitchenomiks, a foodtech startup, which raised $1.8 million in seed and pre-Series A funding to help pay for its expansion into Saudi Arabia this year.

Kitchenomiks, founded in 2022, already operates Oman’s largest cloud kitchen facility, a 3,000 sq m site at the Oman Convention and Exhibition Centre in Muscat. 

The successes of the sultanate’s programmes include an agreement signed by the Authority for Small and Medium Enterprises Development with Oman Telecommunications Company to provide support for SMEs. By the end of June last year, 17 SMEs had been awarded business contracts with the telco, worth OR3 million.

The authority, which was founded in 2020, said in February last year that there were around 210,000 SMEs in Oman.