Oman is a great business destination offering attractive opportunities for investment
Through providing highly favorable business conditions, the Sultanate of Oman is the ideal place for long-term investment opportunities. Oman has experienced high growth, with a very ambitious objective of achieving long-term, inclusive and sustainable growth – real GDP growth averaged 4.7 percent over the past five years, with high investment rates, global integration, modern logistics capabilities and flexible product and industrial markets.
While the Oman’s oil revenues have contributed towards its rapid economic growth and development, the Government has actively pursued Oman Vision 2040 as a development plan focused on diversification, industrialization, and privatization with the aim of stimulating the economy and reducing the share of oil industries in GDP, based on enhancing international integration and attracting increased FDI.
The following provides a summary of Oman’s main competitive advantages, highlighting why Oman is a strategic choice for global investors and businesses:
Strategic Location
The Sultanate of Oman is the third largest country on the Arabian Peninsula, with a total area of 309,500 sq km and a coastline stretching for over 3,000 km overlooking the Arabian Gulf, the Sea of Oman and the Arabian Sea. Oman is strategically located at the entrance to the Arabian Gulf, the source of two-thirds of the world’s oil exports, ensuring easy access to the world’s prime markets (including the ability to bypass the Strait of Hormuz) – India, China, Africa, the European Union and the Americas. With high quality seaports at Salalah, Duqm, Muscat and Sohar, Oman offers access to three continents and more than 2.0 billion consumers.
Key Sectors and Industries
The Government is actively encouraging investment in a number of strategic sectors, including: (1) Logistic services (warehousing, tracking, shipping, supply chain) with some unique locations; (2) Mining of abundantly available minerals including, but not limited to, chromite, dolomite, zinc, limestone, gypsum, silica, copper, gold, cobalt and iron; (3) Fisheries through fishing and industries associated with it; (4) Tourism with marketing, advertising, operation, and related services; and (5) Manufacturing of various products. There are many other sectors which provide attractive opportunities, not least in power and water, oil and gas, transport, social infrastructure and regeneration.
Coalitions and Trade Agreements
Oman is a member of the Gulf Cooperation Council (GCC) and a member of the Indian Ocean rim, with many multi-lateral and bilateral trade agreements including the GCC common market, GAFTA and Free Trade Agreements with USA, Singapore, Iceland, Norway, Switzerland and Liechtenstein. In addition, Oman has strong historical ties with many countries which offers access to markets in Africa, India, Iran and Pakistan.
Legislative Environment
The Government of Oman has adopted transparency, clarity and stability in its approach to policy development, resulting in an investor-friendly legislative environment. As recently as July 2019, Oman issued a package of new laws – the Foreign Capital Investment Law, Privatization Law, Bankruptcy Law and Public-Private Partnership Law – which aim to enhance the Sultanate’s competitiveness and attract foreign investment. These new laws are part of a string of recent reforms by the government that seek to create a more robust regulatory environment for investment, boost the economy, as well as encourage the private sector to play a greater role in Oman’s economic and social development.
High Quality Infrastructure
Oman has modern economic and social infrastructure with a top quality roads network and transportation system, airports, seaports, power and water networks and communications.
Lifestyle
Oman is among the most stable countries in the world, ranked 1st in the Middle East region and 4th globally in one of the World Economic Forum’s latest surveys. Muscat is ranked the 6th most livable city in the Middle East, and the 3rd most affordable place to buy a home in the world.
Key incentives and advantages
- Business-friendly tax regulations with 15 percent flat corporate income tax rate
- Zero percent personal income tax rate
- Corporate tax exemptions for up to 25 years at free and industrial zones
- Tax parity and exemptions
- Double taxation relief treaties available with many countries
- Customs Duty exemption on imports of plant and equipment
- Relief from Customs Duty on raw material
- Export credit insurance through Export Guarantee and Financing Agency
- 70 percent automatic foreign ownership permitted
- 100 percent ownership permitted for specific projects and specific economic zones
- Extremely competitive energy prices for commercial and industrial businesses, with monthly electricity average prices ranging between US$ 0.03–0.05 per kWh
- Ready access to natural gas at internationally competitive prices
- Fully serviced land in industrial zones and estates
- Low prices/rents for industrial estates and free zone land, with annual industrial space rental average at US$ 2,500 per 1000 sq m
- Well capitalized, sound banking system
- Wide range of corporate structures available including locally incorporated companies, partnership, joint venture and foreign company branches
- Availability of offshore corporate finance and access to global private equity
- Presence of skilled and relatively cheap labor
Capitalizing on its competitive advantages and significant key incentives, its rich heritage and unique natural beauty, Oman is a uniquely attractive and sustainable destination for global investment.
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