Oman’s plans to revitalize its economy are in full effect, with plans for a Special Economic Zone in Duqm.
According to Reuters, Oman’s financial position is among the weakest of the wealthy Gulf oil exporters. It is no surprise then why the government has been so active and diligent in trying to bolster the country’s economy by diversifying its income sources beyond oil.
Enter: The Duqm Special Economic Zone
The Sultanate is seeking to raise as much as $1.2 billion to finance infrastructure at the country’s Duqm Special Economic Zone, Bloomberg reports.
Standard Chartered Plc is working as global coordinator to help Oman’s debt management office raise the funds that could be backed by the World Bank’s Multilateral Investment Guarantee Agency, according to an official at the finance ministry.
According to Bloomberg, Oman may raise the financing through a loan or bond with a potential maturity of 15 to 20 years, said the official, asking not to be identified.
The financing would help the government diversify its funding sources, extend its debt maturity profile and reduce costs, the official said. MIGA, which provides political risk insurance, is evaluating the proposal, he said.
Earlier this month, officials from the Special Economic Zone Authority at Duqm (SEZAD) said that they wanted to get local communities more involved in Duqm, besides drawing in more Omani investment, the Times of Oman reported.
They added that SEZAD’s goals were two-fold, one was to attract the foreign investors in building ‘anchor projects’ and the other was to make sure that local communities took full advantage of the benefits, emanating from these projects.
“Firstly, we want to attract foreign investment for the anchor projects. Then, there is the matter of the SMEs associated with them,” the officials stated.
“We want to make sure that Omani interest in these ventures does not dip. So, we are visiting different chambers, such as Oman Chamber of Commerce and Industry (OCCI) to attract more Omanis to take part in these businesses.”
South Korea a believer in the Omani dream
The government has been making progress in attracting foreign investors. Last week, the country signed a memorandum of understanding (MoU) on cooperation between the two sides to establish smart cities, the Oman News Agency (ONA) reports.
The MoU was signed on the sidelines of the Oman-Korea Business Forum, which was organized last week. The Forum aimed to develop a study on the importance of investment factors, projects and fields in relation to smart cities in the Special Economic Zone in Duqm (SEZAD).
There is coordination between SEZAD and the Korean side to prepare a draft to conduct some studies on the vision of smart cities, which became the key engine of many economies around the world.
An expanded dry dock in Duqm
Another development in Duqm involves the plan for a new dry dock expansion plan, which officials hope will further boost the economy.
Engineer Said bin Hamoud al-Ma’awali, CEO of Oman Drydock Company, told the Duqm Economic magazine that “the plan of the company until 2040 includes increasing the number of activities from about 3 to 11, including the construction and repair of offshore platforms for oil production and the manufacture of steel structures used in the oil fields, repairing warships and manufacturing specialized vessels.”
He explained that if the company is able to implement this plan, the level of activity in the dry dock will increase by about 10 times compared to the current level of activity. This will provide 9,000 direct jobs and 9,000 other indirect jobs, as well as increase the level of economic activity of the drydock to about $500 million per annum.