The Vision for Oman's Economy: Oman 2020 aims at carrying out a substantial transformation in the structure of the national economy by developing a multiplicity of income sources, instead of depending mainly on a depletable source like oil in order to achieve economic balance and sustainable growth. Accordingly, it is expected that there will be a gradual decrease in the contribution of the oil sector to the GDP while the

contribution of the non-oil sectors to GDP will increase gradually. It is expected that by 2020 the oil sector contribution to GDP will be 9% while the contribution of the gas sector will increase to 10 %. The increase of other production and services sector will rise to 81%. This significant transformation of the structural composition of the production base of Oman's economy is what we mean by economic diversification.

The creation of such substantial change in the production base of Oman's economy will face challenges commonly associated with this type of structural transformation. It is necessary to formulate a clear strategy that is based on set dimensions and a package of flexible and realistic policies and mechanism if these challenges are to be overcome and the envisaged economic diversification is to become a reality. Economic diversification is seen as one of the main strategies for the achievement of the Vision for Oman's Economy. The plan for diversification aims at addressing existing challenges indicated in the reports and evaluation studies discussed in chapter three, of the Fifth Five Year Development Plan and the challenges that may arise during the process of strategy implementation. Such implementation will be through an integrated set of approved policies and mechanisms, in addition to the programmes that shall be adopted within the framework of the Five Year Plans, beginning with the Fifth Five-Year Plan. This chapter will discuses in detail all the challenges that will face the economic diversification process, the features of the strategy and its main dimensions. In addition, the policies and mechanisms essential for the achievement of the successful diversification of the production base by the year 2020 will also be discussed.

The approved policies and mechanisms for the achievement of the diversification strategy will be subjected to periodic reviews in order to ensure their efficiency, competency and conformity with the changes that may develop in the domestic and international arenas.