Free economic zones boost development of Sultanate

Haider Al lawati – –

Free zones are economic means used by countries to attract and stimulate local and foreign investments, yielding more benefits, while industrial and service projects in these regions play a leading role in promoting socio-economic development, providing jobs and replacing imports.
Accordingly, in 1983 the Sultanate initiated the establishment of the first industrial zone — “Rusayil Industrial Zone” — which currently houses hundreds of factories producing various goods and products that are partly exported and distributed in local markets.
This zone has increased in size in various stages of development to the extent that the authorities had to flatten mountains surrounding the zone to meet the growing demand from Omani industrialists and foreign investors.
Interest in the establishment of free industrial and economic zones manifests in achieving long-term economic development goals, including diversifying sources of national income, creating a proper business environment in the Sultanate, providing employment opportunities for citizens, utilising local raw materials and promoting joint investments.
The Public Establishment for Industrial Estates (PEIE) assists businesses to thrive and grow to compete in global markets, turning the Sultanate into a vibrant commercial hub, as well as ensuring preservation and creation of a favourable business climate that attracts investments. Industrial zones enjoy exemption from tax and customs duties, as industrial establishments are exempted from taxes on import of machinery, equipment, spare parts, raw materials, semi-finished materials and packaging materials.
Moreover, over the past four decades, the Sultanate was able to transform the modest oil revenues to sophisticated economic and social structures and provided them with necessary laws for achieving sustainable development.
These structures are the birthstone of industrial and free zones which are vital components in economic and investment efforts.
Meanwhile, the country enjoys natural resources that attract both domestic and foreign investments.
Oman’s distinct geographic location overlooking international and regional sea routes helped create several economic and industrial free zones, such as Salalah Free Zone, Salalah Port, Sohar Industrial Port, Sohar Free Zone, Al Mazyona Free Zone in south Oman, Musandam Free Zone and SEZAD and Dry Dock at Duqm, opening wider investment prospects of free trade exchange with the rest of the world.
Over the past years, the Sultanate has witnessed the emergence of these free economic and industrial zones as a result of its substantial role in the development of the country, and in attracting and localisation of investments and keeping pace with the rapid developments in the fields of development, technology and IT.
Through these zones, foreign goods are imported, stored and re-exported, and commercial and industrial businesses are practiced in light of exemption from custom duties and taxes.
The Sultanate seeks to diversify its economy based on exports, work on utilising and processing its natural resources, increasing the added value of these resources and signing agreements to establish some major industrial projects with the participation of foreign capital.
The components established by the Sultanate to promote the work in these zones are promising along with providing a wide and
flexible legal systems, which prepares it to become an exporter and an important global location in the field of re-exports.
Moreover, promoting the work of these industrial and economic zones is based on expansion and completion of infrastructure requirements, in addition to facilitating investors ventures and providing them with necessary services to attract more domestic and foreign investment, and to strengthen its position on
the global arena as one of the best destinations for investment in the region.