VZCZCXYZ0000
OO RUEHWEB

DE RUEHMS #0100/01 0411440
ZNR UUUUU ZZH
O R 101439Z FEB 10
FM AMEMBASSY MUSCAT
TO RUEHC/SECSTATE WASHDC IMMEDIATE 1228
INFO GULF COOPERATION COUNCIL COLLECTIVE

UNCLAS MUSCAT 000100 
 
SENSITIVE 
SIPDIS 
FOR H/EX/CTO AND NEA/ARP 
 
E.O. 12958: N/A 
TAGS: OREP PREL MU
SUBJECT: OMAN - CODEL LOWEY SCENESETTER 
 
REF: (A) STATE 10695; (B) MUSCAT 096 
 
¶1. (SBU) Summary:  Embassy Muscat warmly welcomes CODEL Lowey.  The 
visit will be important in deepening our nation's relationship with 
the Sultanate of Oman.  As Sultan Qaboos heads into the fortieth 
year of his reign, Oman is continuing the development that, since 
1970, has taken it from isolation and poverty to a modern state. 
You will find Oman a country characterized with outstanding 
leadership along with good governance and rule of law through the 
development of strong governing institutions.  The Sultan has taken 
a personal interest in strongly defending and promoting the 
position of women and ensuring that the countries resources are 
evenly distributed throughout this rugged country.  The Sultanate 
is a reliable military ally and a good trading partner of the 
United States.  Without fanfare, Oman also makes many positive 
contributions to Middle East Peace, regional stability, and 
ameliorating humanitarian crises.  End Summary. 
 
 
 
National Development Under the Sultan and Relations with the U.S. 
 
 
 
¶2. (SBU) Embassy Muscat warmly welcomes Chairwoman Nita Lowey and 
accompanying delegation to Oman.  Your visit will provide an 
excellent opportunity to further the already strong relationship 
between the United States and the Sultanate of Oman.  2010 is also 
an opportune year, marking the 40th year of the rule of Sultan 
Qaboos, an era that Omanis proudly call their nation's renaissance. 
Oman was once known as a country marked by poverty, disease, and 
illiteracy.  The past 40 years have seen Oman, while still 
developing, grow into a modern nation of rule of law and of 
institutions and with high standards of education, health care, and 
regard for its citizens and expatriate residents. 
 
 
 
¶3. (SBU) The U.S. relationship with Oman dates back 200 years, with 
American merchant ships making port calls in Oman as early as 1790. 
The two nations signed a Treaty of Amity and Commerce in 1833. 
Oman was the first Arab nation to recognize the United States, 
sending an envoy in 1841.  Formal diplomatic relations were 
established in 1972, with the United States represented by its 
ambassador in Kuwait.  Oman opened an embassy in Washington in 
1973; the U.S. opened Embassy Muscat in 1974. 
 
 
 
¶4. (SBU) Your visit will be the first by a Congressional Delegation 
in over two years, and you are eagerly awaited by your hosts and 
counterparts.  The Embassy, as advised by Congressional Staff, is 
working with the Government of Oman to fit a rewarding and 
ambitious program into the available period of time.  It is 
traditional practice in Oman that the final schedule is released by 
the Government closer to the time of arrival. 
 
 
 
Foreign Policy - Regional Stability - And Assistance 
 
 
 
¶5. (SBU) Oman's foreign policy is strongly focused on regional 
stability.  A common saying in the region is that Oman is a friend 
to all and the enemy of none.  Nevertheless, Oman is not afraid to 
break with consensus when it believes its greater regional 
interests will be preserved.  For example, unlike many Arab 
countries Oman did not break diplomatic relations with Egypt when 
that nation signed its peace treaty with Israel - a move that Egypt 
has not forgotten.  An old friend of the Shah of Iran, the Sultan 
was deeply disturbed by the Iranian revolution.  Oman views Iran as 
the strategic threat to the region but has chosen to manage the 
threat by fostering strong working relations with Tehran, 
especially as it concerns the Strait of Hormuz.  About 40% percent 
of the world's oil and gas passes through the Strait, and all the 
navigable shipping lanes are in Omani territorial waters. 
 
 
 
¶6. (SBU) Oman is concerned about the situation in Yemen, with an 
armed rebellion in the North and a renascent separatist movement in 
the South.  To help stabilize the situation, Oman provides 
substantial economic and humanitarian assistance to the Yemeni 
people in conjunction with the Yemeni Government.  Likewise, Oman 
provides assistance to refugees in Afghanistan and Pakistan.  To 
 
avoid inadvertently funding extremists, the preferred Omani method 
is to purchase humanitarian supplies locally, to support the 
economy of the stricken region, and supervise delivery in 
conjunction with the host government.  Oman was one of the first to 
offer - and deliver - humanitarian relief supplies to Haiti. 
 
 
 
Economy 
 
 
 
¶7. (SBU) Oman, unlike its neighbors, is not flush with 
petrodollars. The GDP per capita is approximately $20,000, which is 
relatively evenly distributed. Oman's primary source of revenue is 
petroleum. The Ministry of Oil and Gas predicts an average of 
850,000 barrels per day for 2010. Increases in Oman's production 
capacity largely stem from enhanced oil recovery methods (EORs), 
and no recent oil discoveries have been made. To address its 
dwindling oil resources, Oman has engaged in aggressive 
infrastructure development and has focused on sectors of the 
economy ripe for development. Such sectors include tourism and 
downstream manufacturing. The Ministry of Commerce and Industry has 
also heavily emphasized the need for small- and medium-sized 
enterprise development. 
 
 
 
The Status of Women and the Growth of Civil Society 
 
 
 
¶8. (SBU) The past 40 years have shown a dramatic shift in 
opportunities for women.  While women were afforded no education 
before 1970, there is now universal education, and more than half 
of all university undergraduates are women.  Women make up 35 
percent of all graduate students at Sultan Qaboos University.  Over 
half of all teachers in public schools are women. 
 
 
 
¶9. (SBU) There is notable progress at higher levels as well.  Three 
members of the Council of Ministers are women:  the Ministers of 
Higher Education, Tourism, Social Development.  Oman was the first 
Arab nation to appoint a female ambassador, to the Netherlands, in 
¶1999.  It currently has two female ambassadors, to the United 
States (since 2005) and Germany (2009).  Women hold 12 percent of 
senior government positions and make up over 40 percent of the 
civil service. 
 
 
 
¶10. (SBU) In terms of civil society more generally, Oman is slowly 
but steadily moving from almost total state control of all 
organizations, societies, and activities to enabling the 
development of non-governmental organizations and private activism. 
The Sultanate has made real strides in the past five years, 
allowing for greater private initiative, for example, in efforts 
that promote public health and well-being, discuss social and 
cultural issues, and help Omanis better understand the rights -and 
obligations - of citizenship.  Aspects of this development that we 
take for granted - basics like networking among peers (rather than 
within traditional communities and extended families), information 
sharing, and public discussion of issues that might prove 
controversial - are still novel in Omani society.  Along with other 
international partners, the U.S. has played an important role in 
providing expertise and funding (especially through the Middle East 
Partnership Initiative, MEPI) in support of this encouraging 
development. 
 
 
 
The Base Access Agreement (BAA) 
 
 
 
¶11. (SBU) Military cooperation, as laid out in the U.S.-Oman BAA, 
has been a central pillar of our bilateral relationship since the 
agreement's inception in 1980.  Renewable every 10 years, the 
agreement's next iteration is currently under negotiation.  This 
security agreement has endured for 30 years, during a time of 
enormous change in the world.  It gives U.S. forces, with 
consultation, access to Omani facilities, as well as the ability to 
pre-position war reserve material in select locations.  As the 
situations in southern Central Asia, Somalia, and Yemen unfold, the 
need of such access, as well as for continued support for a strong 
and stable Oman, increases in importance.  Oman exists in a tough 
 
part of the world, with Iran only 35 miles away.  The sea lanes 
through the Strait of Hormuz lie wholly in Omani territorial water. 
Oman was the first Persian Gulf state to permit the use of its 
military facilities by U.S. forces. 
 
 
 
The Free Trade Agreement (FTA) 
 
 
 
¶12. (SBU) The newest pillar of our bilateral relationship is the 
U.S.-Oman FTA, which came into effect in January 2009.  The 
universal reaction from government interlocutors, business people 
(Omani and American), and the population at large is positive.  The 
U.S. and Oman have just completed the first annual Joint Committee 
Meeting pursuant to the agreement.  U.S. workers, farmers, and 
entrepreneurs now enjoy new opportunities in this growing market. 
The agreement also marks a milestone in strengthening ties and 
promoting freedom in the Middle East.  The Oman agreement builds on 
U.S. free trade agreements concluded with Israel, Jordan, Morocco, 
and Bahrain. 
 
 
 
¶13. (SBU) Nearly 100 percent of two-way trade in consumer and 
industrial products is now duty free.  This expands opportunities 
for U.S. exporters of machinery, automobiles, medical instruments, 
electrical machinery, and agricultural products such as vegetable 
oils, sugars, sweeteners, and beverage bases.  In addition, Oman 
will provide substantial market access to U.S. suppliers across its 
entire services regime, provide a secure, predictable legal 
framework for U.S. investors in Oman, provide for effective 
enforcement of labor and environmental laws, and enhance the 
protection of intellectual property.  Current bilateral trade runs 
at about $2 billon/year.  We expect that will grow as the world and 
the region recover from the economic crisis. 
 
 
 
The Middle East Desalinization Research Center (MEDRC) 
 
 
 
¶14. (SBU) MEDRC is a unique institution, the only intergovernmental 
organization in which Israel, the Palestinian Authority, and Jordan 
sit at the same table on a regular basis.  As a symbol of 
cooperation and collaboration for the promotion of Middle East 
Peace, MEDRC addresses the important issue of cooperation among 
stakeholders in meeting fresh water demand.  MEDRC was established 
through the Water Working Group of the Multilateral Track of the 
Middle East Peace Process in December 1996, as an international 
research organization, headquartered in Muscat.  MEDRC is supported 
by its members: Israel, the Palestinian Authority, Jordan, Oman, 
Qatar, The United States, Netherlands, Japan, and Korea, which make 
up the MEDRC Executive Council, the governing body which controls 
all of its activities and policies. 
 
 
 
¶15. (SBU) However, MEDRC faces significant funding challenges. 
Sitting on land provided by the Government of Oman, and provided 
with funding from some of its members (the U.S. is in the process 
of delivering $400,000 in FY 09 funds), MEDRC has no stable income 
with which to operate or to fund and finance research.  The Center 
is working intensively to attract new members and contributions to 
the Executive Council so that MEDRC can continue its unique role in 
the region. 
 
 
 
¶16. (SBU) In conclusion, Embassy again expresses its pleasure at 
the visit of CODEL Lowey.  Embassy looks forward to working with 
CODEL Lowey to make this a successful and rewarding visit. 
Schmierer