TO:              Thord Palmlund, UNDP/MDP

FROM:           Courtney Nelson

Subject:        Oman report 1990

          After our conversation in Cambridge on Friday, it occurred to me that you might find useful a brief summary of the findings of the reconnaissance mission couched in more direct language than seemed to me appropriate for the report itself. I believe all the points made below are found in the report, but they may not be clearly presented for someone unfamiliar with Oman.


Krak des Chevaliers, Syria 1973

          Oman was deliberately shielded from the corruptions of the modern world by the father of the present Sultan prior to his succession in 1970. Roads, schools, hospitals and telecommunications were virtually unavailable to the people, despite the availability of substantial, although not lavish, funds from oil. Sultan Qaboos, in contrast, upon taking power, used the country's resources to build the modern infrastructure of the country in a remarkably short period of time.

          As a result of this dramatic shift in strategy, managers and management systems had to be imported wholesale, along with the technologies. There were few systems to build upon or upgrade in the country, and very few experienced Omanis to guide and shape the modernization process. At the same time, many Omanis were encouraged to go abroad for education, in most cases supported by Government funds. In the rush to gain educational qualifications, little attention was paid to the selection of institutions or the preparation of candidates.

          Omanis are returning now in increasing numbers, and a new university is beginning to turn out graduates. Up until now, educated Omanis have readily found places in the civil service. Now the numbers of people available is increasing but their qualifications are often not attractive to private and public employers. Educated unemployed are appearing for the first time, just as the need to replace non-Omanis with nationals becomes more acute: lower oil prices (before the current blip) and declining production have forced the budget into deficit.

          In this situation of declining per capita income from oil and increasing availability of poorly educated Omanis, the pressures on the Ministry of Public Service are great for the rapid replacement of foreigners by Omanis. At the same time, the Ministry feels the need to institute more regular personnel management practices, such as job classification and performance evaluation systems. The advisor to the Minister has urged that priority be given to job classification, and a UN interregional advisor made similar recommendations, following a visit to the Ministry shortly after it was set up two years ago.

          In my view, for the Ministry of Civil Service to give priority to traditional personnel functions at the present time would be most unwise. Oman confronts the task of increasing the productivity of the entire society, starting with the civil service. Deficit financing has buoyed up the standard of living of Omanis in the Government, but even if oil prices remain at present or slightly higher levels, the longer-term outlook for revenues from petroleum is not good because of reserve depletion. Oman must upgrade its economic management systems and upgrade the quality of its personnel if it is to avoid a serious decline in living standards.

          The Ministry of Civil Service, with its Institute of Public Administration, could become an important avenue for the Government of Oman to gain access to outside expertise on economic management, analytical systems, and high-quality staff training. The MDP has a comparative advantage over other multilateral agencies in helping the Ministry acquire the competence to tap external sources of support, because of the flexibility of its operations. I have consequently recommended a way to design a program of cooperation between the Ministry and the MDP, stressing increasing emphasis on quality in the selection of candidates and programs of overseas study; creation of opportunities for private study in Oman for people interested in improving their qualifications; access to improved systems of project appraisal, sectoral analysis, and planning, budgeting and other economic management methodologies; and an interministerial mechanism for involvement of the Ministry in all major human resource development and systems development activities of the Government.

          The proposed course of action is quite different from that recommended by the present advisor to the Minister and by a previous UN consultant. The Minister will want to think carefully about the implications of the analysis and the course of action put forward. Fortunately, the UNDP Resident Representative, Saleem Kassum, has been trained at Cornell in labor economics and he will be helpful in elucidating the report for the Minister.

          It is entirely possible that the advice of the advisor to the Minister will prevail, and a more traditional approach to the role of a civil service institution will be preferred, but if I have succeeded in articulating the case properly I believe the Minister will be most interested in following up the proposed course of action.

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