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Projects | Education & Economy DNA Oman

Economy & knowledge clusters

Idea

The economy & knowledge clusters are a key project of the vision DNA Oman and can be seen as centers where industry, research and education come together and benefit from each other. The clusters consist of industrial estates, higher education institutions (e.g. university branches) and technology parks and should secure development and innovation in the Omani economy. In different locations the clusters are specialized in distinct sectors, which helps the country to diversify its economy and reduce the dependence on oil.
The spatial closeness and sectoral specialization in each cluster brings advantages to all institutions concerning knowledge, mobility, logistics, supply and energy. Also social infrastructure, for example child care facilities, could be shared.
DNA Oman The clusters are furthermore an opportunity to define what the modern Oman stands for: highly qualified people, modern technologies, environmental awareness and the will of innovation and improvement. The clusters can also differ from the traditional architecture and obtain the function as landmarks.
The establishment of economy & knowledge clusters forces two parallel processes in the Omani economy: Diversification on a national level and specialization in the clusters themselves. The diversification of economy is necessary if the country wants to significantly reduce its dependency on oil during the next decades and change towards a strong, resilient economic sector. At the same time, the specialization inside the clusters allows synergies, supports innovation and can reach to knowledge spillover effects. In addition to that, specialization makes it easier to create a unique image and identity to each cluster which brings advantages in marketing and branding.
With the Knowledge Oasis Muscat (KOM) there's already one approach to a technology park which can be developed further and established in different regions of the Sultanate.


Reference

The cluster idea was discussed in literature and science mainly since the 1990s. A famous scientist in this context was Michael Porter, who introduzed and popularized the term business cluster in his publication The Competitive Advantage of Nations. Cluster development has since then become a focus for the economy programs of many states. Porter states that clusters affect the competition in three ways: by increasing the productivity of the companies in the cluster, by driving innovation in the field and by stimulating new businesses in the field.
In summary a business cluster is a geographical location where enough resources and competences give a key position in a given economic branch of activity, and produce a sustainable competitive advantage over other places or even a world supremacy in that field (e.g. Silicon Valley). (see details)

Implementation

Of course the instruments of spatial and regional planning have only limited possibilities to realize the establishment of economy & knowledge clusters as companies and educational institutions cannot be forced to settle in the clusters. Nevertheless there are a lot of possibilities how to support the development of the e&k clusters:
Economy structure: If complementary branches of business are located in the same cluster they can achieve synergies and benefit from the spatial closeness. Although it might seem counterproductive at first it is essential that not just any company can settle in the clusters. Only companies who offer similar or complementary products or services have the same requirements for infrastructure and qualification of labor force, can exchange knowledge, establish cooperation and commodity chains.
Cooperation with educational institution: The placing of educational institutions such as universities, vocational schools or technical colleges is a powerful instrument for the government to force the building of e&k clusters. The institutional cooperation and contextual reconciliation of economy and education in the clusters bring improvements on the quality of education and better educated labor force for the companies. Moreover companies and universities can work on research projects together which leads to innovation.
Infrastructure: A location can be made attractive for companies by offering high-level technical and social infrastructure. Companies of the same sector may have similar requirements for technical infrastructure. The social infrastructure, for example common recreation rooms, can also support the communication between people of different companies. Due to spatial closeness also technologically innovative solutions concerning infrastructure can be applied (e.g. district cooling).
Advice and consulting: Especially small and young companies cannot afford their own consulting departments. In a cluster, these facilities can be offered to make the location more attractive and help companies with problems concerning law, government aid or patents.
Marketing: A certain image or trademark supports marketing outside the cluster but also increases identification of the companies inside the cluster.
Communication: Information exchange, communication and cooperation is essential for the success of the cluster strategy. These processes can be forced by certain events, where people from different companies come together, or just by offering spaces in the area (for example common rooms) where people can meet each other and exchange ideas in their every day work life.
Use of endogenous potentials: Especially when choosing the economy structure of a cluster it is fundamental to focus on the endogenous potentials of the region. Only if regional strengths are incorporated in the idea the clusters can be long-lasting successful.
Embedding in regional and inter-regional networks: Nevertheless the cooperation inside the cluster is very important, it is essential that the cluster is integrated in regional, inter-regional and international networks. The cluster should never be seen as an isolated, closed formation.

Time frame

Medium- to long-term
The establishment of economy & knowledge clusters is a very important key project in the vision DNA Oman. For this reason, the initiation and realization should be started as soon as possible. Nevertheless development in economy and education always has to be seen as a long-term process and cannot be reached in a few years. One essential step is to invest right away (short-term action) in employment of highly qualified teachers (not necessarily from Oman), who guarantee excellence in higher education. Simultaneously the process of designing and building clusters should be started. Of course not all clusters can be realized at the same time following one standardized plan. It is essential that the idea of the cluster is adapted to each location specifically and realized in the right scale and based in the endogenous potentials of the region.

Advantages

  • diversification of economy
  • specialization in different sectors (reduce dependency on oil)
  • knowledge-based industries bring jobs for highly educated and qualified people
  • support of innovations and R&D
  • connection between higher education and labor market, connection between producers of knowledge (universities) and users of knowledge (industry)
  • improve the image of the private sector
  • concentration of industry and services offers possibility for attractive solutions concerning energy (e.g. district cooling), mobility and other infrastructure
  • possible symbol for “modern Oman”: opportunity for innovative architectural design
  • increase of competitive advantage through innovation
  • reduction of spatial disparities through poly-centric, balanced regional development
  • creating of unique products, branding
  • Sectors

    Each economy & knowledge cluster should concentrate on a specific sector in order to avoid competition among the different clusters and to guarantee diversity in the economy. If complementary branches of the same sector are located in one cluster they can benefit from each other and share their knowledge without being in a competitive situation. In the vision DNA Oman it is not determined, which sector should be applied where. The country itself should be flexible in the realization and implementation of the clusters. The following future-orientated branches could play an important role in the economy & knowledge clusters:

    Health:

  • Education: medicine, pharmaceutics, medical engineering
  • Industry: Pharmaceutical industry, medical technology (x-ray, cardiology, prostheses, intensive care, etc.)
  • Science: research concerning medicine, laboratories, pharmaceutic research
  • Energy technologies (renewable energies):

  • Education: energy management, environmental management, energy technology, renewable energy systems, etc.
  • Industry: Production of solar cells, production of wind turbines, energy-related industry, electric car production
  • Science: research concerning energy systems and technology
  • Arts & culture:

  • Education: Design (especially industrial design, product design), architecture, media, graphic design, also combination with IT (e.g. web design)
  • Industry: any kind of mass production, e.g. combination with processing of oil, plastics, etc.; electric car production
  • Trade & Logistics:

  • Education: Logistics, transport management, …
  • Industry: Harbor --> can be combined with almost everything
  • Other possible sectors:

  • Natural sciences: Biology, physics, chemistry, environmental sciences, geology, ecology, biotechnology, …
  • Water technology: desalination plants, etc.
  • Food & food production, food science, agriculture,...
  • Telecommunications, IT, communication technology
  • Locations

  • Muscat (Rusayl industrial estate, 2nd cluster)
  • Sohar (industrial estate)
  • Sur (industrial estate)
  • Nizwa (industrial estate)
  • Buraimi (industrial estate)
  • Salalah (Raysut industrial estate, 2nd cluster)
  • Khasab/Musandam
  • Duqm
  • Ibri