Free Trade Agreements in Oman

What are Free Trade Agreements? 

A free trade agreement is an agreement between two or more countries to reduce trade barriers. A free trade policy allows goods and services to be bought and sold across international borders with few or no government tariffs, quotas, subsidies, or prohibitions impeding their exchange.


How does Free Trade Agreement work?

In today’s world, free trade policy is frequently implemented through the formal and mutual agreement of the nations involved. On the other hand, a free-trade policy may simply be the absence of any trade restrictions.

To promote free trade, a government does not need to take specific actions. This hands-off approach is known as “laissez-faire trade” or trade liberalisation.

Governments that have implemented free-trade policies or agreements do not necessarily relinquish all control over imports and exports or eliminate all protectionist policies. Few free trade agreements (FTAs) in modern international trade result in completely free trade.


FTA in Oman 

The Sultanate of Oman is a high-income country and one of the Arab world’s most developed and stable countries. Oman has been a member of the World Trade Organization (WTO) since 2000. Not to forget, Oman is also a party to The Free Trade Agreement Between The Efta States And The Member States Of The Co-Operation Council For The Arab States Of The Gulf. 

Oman’s membership in the Gulf Cooperation Council (GCC) has been a key factor in shaping Omani trade policy. This has included reviewing and revising trade policy in areas such as contingent trade remedies, government procurement, commercial firms, and investment. Oman is also a member of the Greater Arab Free Trade Area and has a bilateral trade agreement with the US that went into effect in 2009. Fuels and mining products account for 79% of Oman’s exports, with manufacturing accounting for 10% and agriculture accounting for 2%.

The FTA between the United States and Oman, which went into effect on January 1, 2009, builds on existing FTAs to promote economic reform and openness. Implementing the comprehensive agreement’s obligations will increase export opportunities for US goods and services providers, strengthen Oman’s trade and investment liberalization, and strengthen intellectual property rights protection and enforcement.

The FTA Joint Committee (JC) held its first meeting in February 2010, co-chaired by the Office of the United States Trade Representative and Oman’s Ministry of Commerce and Industry. Officials from the two governments met to discuss a wide range of trade issues, including Oman’s obligations under the labour and environment chapters, as well as cooperative efforts in those areas.

USTR led a mission to Oman in October 2009 to discuss labour issues in order to advance common goals under the FTA’s Labor Chapter. During the visit, U.S. government officials from the USTR, Labor, and State Departments met with Oman’s Ministry of Manpower, as well as representatives from labour and business groups and other government officials. The mission was successful in advancing a dialogue on key labour issues, and U.S. officials encouraged Oman to continue implementing labour reforms discussed during the FTA negotiation and implementation process.

The US Department of Labor is funding a project run by the International Labor Organization to improve the effectiveness of labour inspections conducted by Oman’s Ministry of Manpower as part of ongoing labour cooperation and capacity building efforts. During the coming year, the two governments will schedule meetings between their respective experts on labour and environmental issues to ensure effective implementation monitoring and compliance with FTA obligations, as well as cooperative efforts to ensure that trade and environmental goals are mutually supportive and sustainable.


Oman provides immediate duty-free access to virtually all industrial and consumer products in its tariff schedule under the FTA. The United States provides duty-free access to all of Oman’s current agricultural product exports to the United States. Oman is also a member of the Gulf Cooperation Council, which allows duty-free trade among its members as well as with other countries with which it has free trade agreements.


S & A Law Firm