Royal Decree on Airport Free Zones on anvil in Oman

Oman is developing the legislative framework necessary to spur the growth of free zones around key airports in the Sultanate.

The initiative is being driven by the Implementation Support and Follow-Up Unit (ISFU), a task force operating under the auspices of the Diwan of Royal Court to oversee the speedy delivery of projects proposed as part of the National Programme for Enhancing Economic Diversification (Tanfeedh).

Explaining the rationale behind the issuance of a Royal Decree to this effect, ISFU said: “Given the regional competition, this is a key enabler identified in the national air cargo strategy to support the development of the airport city as a business hub. Initiated by the strategy and concept master plans, several potential clusters have been identified. These clusters require free zone status to match and ideally beat regional free zones on competitiveness.

The proposal for a Royal Decree regulating airport free zone developments is one of 21 logistics-related projects and initiatives currently under various stages of implementation with the support of ISFU.

According to ISFU, robust legislation, underpinned by comprehensive and attractive free zone policies and procedures, is key to attracting local and international tenants to the Airport Free Zone and wider Airport City, thereby enabling the growth of air cargo growth.

“Existing free zone policies and procedures through a Royal Decree need to be reviewed and amended, in line with best practices, to make the Airport City sufficiently attractive so to enhance the air cargo ecosystem, broader logistics sector and accompanying socio-economic benefits,” said ISFU in its newly published 2019 Annual Report.

Stakeholders in the initiative include the Ministry of Technology and Communications (MTC), Port of Duqm, Oman Global Logistics Group (ASYAD), Oman Air SATS Cargo, Oman Aviation Group, shipping agents and customs brokers, freight forwarders, and the Special Economic Zone Authority at Duqm (SEZAD).

Significantly, a draft of the proposed Royal Decree for Airport Free Zones has been submitted to the Council of Ministers for its consideration and approval, according to ISFU. “The focus in 2020 will be on the finalisation of the detailed master plan for the Airport City, and issuing the Free Zone Royal Decree for Airports,” it added.

The first such airport free zone, anchored by an ambitious Airport City complex, is already envisioned at Muscat International Airport.

The National Aviation Strategy 2030 unveiled earlier this year includes plans for the Muscat Airport City project, the centerpiece of which is a Muscat Airport Free Zone. Covering an area of 3.3 million square metres, the zone will be earmarked for investments related to light industry, warehousing and storage of airfreight, ecommerce activities, aviation-related goods and equipment, and an integrated service delivery station. Clusters related to aviation services, hospitality, duty-free shops, and air-cargo are envisaged as well.