الأمن الصناعي الوطني: عندما يتحول المحتوى المحلي من مؤشر أداء إلى استراتيجية وطنيةNational Industrial Security: When Local Content Evolves from a Performance Indicator into a National Strategy

In today’s world, the concept of national security is no longer limited to political and military dimensions. It has expanded to include a country’s ability to secure its essential needs and maintain economic continuity in the face of crises. The COVID-19 pandemic exposed the vulnerability of global supply chains, while geopolitical developments and disruptions to global trade and transportation routes have demonstrated that excessive dependence on external sources can shift from an economic advantage to a source of risk.

This is where the concept of national industrial security emerges: a country’s ability to ensure the availability of essential industrial products, supplies, and services; maintain the continuity of supply chains; and build national capabilities that can produce, adapt, and respond to changing circumstances.

Within this context, Local Content can evolve from merely an indicator used to measure the level of expenditure retained within the national economy into a strategic tool for building industrial capabilities and strengthening national industrial security.

From Local Spending to Industrial Capability

The concept of Local Content has traditionally been closely associated with increasing procurement from local companies and retaining a greater share of expenditure within the national economy. However, the true value of Local Content extends far beyond the purchasing process itself.

The more important question is not simply:

How much did we spend locally?

But rather:

What did we build through that spending?

When local demand leads to the establishment of factories, supplier development, technology and knowledge transfer, the development of national talent, and the creation of integrated supply chains, expenditure evolves from a temporary economic value into a sustainable national productive capability that can continue to grow and compete.

Local Content can therefore be viewed as a transition from retaining value within the economy to building the capacity to create value; from supporting local suppliers to developing an industrial ecosystem capable of meeting national needs and expanding into international markets.

This is the essence of the relationship between Local Content and industrial security.

Oman Vision 2040: From Diversification to Capability Building

This direction aligns with Oman Vision 2040, which places the development of a diversified, competitive, and sustainable economy, the advancement of the industrial sector, and the maximization of local value among the country’s national development priorities.

Economic diversification is not achieved merely by increasing the number of sectors. It requires building genuine productive capabilities within those sectors, reducing vulnerabilities in supply chains and strengthening the economy’s ability to withstand shocks.

Local Content can therefore become one of the tools connecting expenditure with industrial investment, localization, technology, and national talent.

The Trade Balance: A Different Perspective on the Surplus

Oman’s trade balance for 2025 provides a clear example of why industrial security should be viewed from a broader perspective.

Merchandise exports amounted to approximately OMR 23.26 billion, compared with imports of around OMR 17.16 billion, resulting in a trade surplus of approximately OMR 6.1 billion.

However, around OMR 14.51 billion of exports came from oil and gas, representing approximately 62% of total exports. At the same time, imports increased by 2.7% during the year.

These figures reveal an important dimension when the trade balance is viewed through the lens of industrial security.

If oil and gas exports are excluded from total exports, the remaining merchandise exports amount to approximately OMR 8.75 billion, compared with imports of around OMR 17.16 billion.

In purely mathematical terms, the picture would therefore shift from a surplus of approximately OMR 6.1 billion to a deficit of around OMR 8.4 billion.

This comparison does not suggest that oil and gas exports are not a fundamental strength of the Omani economy. On the contrary, they remain an important source of revenue and exports. However, it demonstrates that a trade surplus alone does not fully reflect the industrial capability of an economy.

This leads to an important question:

What if we could transform part of our imports into competitive local production?

Imports should not be viewed solely as a cost to the economy. They can also serve as a map of future industrial opportunities. Every product or component that can be competitively manufactured locally represents an opportunity to retain value within the economy, develop suppliers, build knowledge and technology, create jobs and skills, and potentially transform some of today’s imports into tomorrow’s exports.

What Have Crises Taught Us?

The COVID-19 pandemic demonstrated that supply-chain efficiency under normal conditions does not necessarily guarantee resilience during crises. Current geopolitical developments and disruptions to global trade routes have further shown that the availability of a product in international markets today does not necessarily guarantee its availability tomorrow.

Industrial security, therefore, does not mean attempting to produce everything locally. Such an approach would be neither realistic nor economically viable. Instead, it means identifying strategic products and industries in which the Sultanate should possess domestic production capabilities, or for which it should secure multiple and reliable sources of supply.

In this context, analysing imports and linking them to Local Content can become an important tool for determining industrial localization priorities.

National industrial security represents a natural evolution of the Local Content concept. Local Content should not end with increasing expenditure on local suppliers. It should lead to building companies, localizing industries, transferring technologies, developing capabilities, establishing supply chains, and strengthening resilience in times of crisis.

In this way, Local Content can evolve from focusing on how much value remains within the economy to also considering how much capability is being built within it.

Perhaps the time has come to move beyond the question:

“What percentage of Local Content have we achieved?”

and towards a more strategic question:

“What national industrial capabilities have we built through Local Content?”

When expenditure is transformed into productive capability, capability into competitive industry, and industry into exports and added value, Local Content becomes more than a performance indicator. It becomes a tool for building national industrial security, advancing economic diversification, and strengthening the Omani economy’s ability to navigate a rapidly changing world.