The Oman-Germany joint commission has given the green light for a 650-million-dollar joint venture fertiliser project and a 450-million-dollar methanol plant, Berlin's ambassador told AFP on Monday.
"Both these projects will be completed by 2006, with work starting any time (now) to reduce Oman's dependence on fluctuating oil income as part of its economic diversification," said Hartmut Blankenstein.
The fertiliser project brings together German engineering giant Uhde, which is already involved in another fertiliser scheme in Sur, and Oman's Soheil Bahwan Group.
The methanol plant involves German firm Ferrostaal and the sultanate's Zawwai Establishment.
Both joint ventures will be set up at the Sohar Industrial Complex, which lies between Muscat and Abu Dhabi.
The announcement came after three days of work by the commission to try to boost tourism and investment in the Gulf state, which is on a drive to promote itself as a holiday destination.
A high-level German delegation, including more than 40 business executives, focused on the country's 1.2-billion-dollar Sohar refinery project and an 805-million-dollar seaside resort on the edge of the capital.
The Wave resort, to boast a marina, golf course and luxury hotels and apartments, covers 7.3 kilometres (4.5 miles) and two million square metres (500 acres) of existing land with another 400,000 square metres to come from reclaimed land.
The German delegation met with tourism under-secretary Mohsin Khamis al-Balushi and the Berlin ambassador said: "We welcome new incentives being offered to tourism investors."
"We hope Omani authorities will also allow non-GCC (Gulf Co-operation Council) citizens to buy and build property in the Wave," the ambassador added.
Oman, which boasts rugged mountains and baking deserts, saw its fledgling tourist industry take a hard blow after the September 11, 2001 terror attacks on the United States.
The conservative Muslim state, which occupies the eastern edge of the Arabian peninsula, has avoided the mass tourism of Dubai, targeting instead middle- and high-class tourists to try to stimulate the economy without offending local sensitivities.
The German delegation was to move on to Qatar and Kuwait.
"Germany wants to become part of Iraq's reconstruction," the envoy said. "It is time the US allowed countries outside the coalition to play their role in Iraq's all-important reconstruction."