Free trade zones to fuel investment, economic growth: Macki

• Text size
•  
•  

MUSCAT -- Oman's free trade zone initiatives will serve as catalysts for investments and economic development, according to Ahmed bin Abdulnabi Macki, Minister of National Economy and Vice- Chairman of the Financial Affairs and Energy Resources Council. In comments to the Observer, Macki said ongoing free zone developments at Salalah and Sohar, and a proposed scheme at Duqm, would also fuel economic growth in the respective host regions of the Sultanate. "The vision behind the development of the free trade zones in Oman (Salalah, Sohar and Duqm) is to diversify the economy from the oil sector and enhance socio-economic development in the different regions of the Sultanate.

These zones offer world-class infrastructure and services to attract different investments to the strategic industrial locations, as well as enhancing the partnership and collaboration across industries and borders." Employment generation is a key underlying objective behind the free zone schemes, Macki stated. "All these trade zones will contribute efficiently towards the goal of creating new job opportunities and generating income. At the same time, they will boost export manufacturing capacity, which leads to export growth and export diversification, attract foreign direct investment, along with it modern technologies and knowhow, and increase government revenue."

"The trade zones," he further added, "would definitely act as catalysts for more investments in allied fields leading to accelerated growth of various regions in the country." Oman's maiden free zone initiative, set up alongside the Port of Salalah in Dhofar Governorate, has already pulled in over $2 billion in industrial investment. The facility hosts two major industrial ventures -- a methanol scheme run by Salalah MethanolSalalah Methanol, and OCTAL PetrochemicalsOCTAL Petrochemicals, a world-scale producer of PET sheets and resins. Construction will also start later this year on a caustic soda project involving a capital investment of $350-400 million. At least half a dozen other smaller ventures have set up operations at the complex.

Salalah Free Zone has now embarked on the third phase development of the sprawling 2,000-hectare facility. Covering an area of 260 hectares, this phase will be dedicated to investments related to logistics, light and medium industries, re-export trade and information technology. Oman's biggest free zone scheme by far is under development adjacent to the hugely successful Sohar Industrial Port in the Batinah region. Freezone Sohar is being developed by Sohar International Development Company (SIDC), a 50:50 joint venture between the Government of Oman and Port of Rotterdam, and SKIL Infrastructure Limited of India.

Of the 4,500 hectares earmarked for the massive venture, a 500-hectare plot has been taken in hand for development in the first phase. The free zone authority is in the process of appointing a consultant to undertake detailed design and engineering studies for Phase 1, which is targeted to be brought into operation before the end of this year. Equally ambitious will be a Free Trade Zone and Industrial Area envisioned at Duqm in the Wusta region. Singapore-based international consultant Jurong has been selected by the government to undertake the master-plan study of the scheme.

The Duqm Free Trade Zone and Industrial Area is proposed to be housed on a 24,000-hectare plot not far from the site of the Duqm port and dry dock complex currently under construction. A preliminary study commissioned by the Supreme Committee for Town Planning (SCTP), which is overseeing the Duqm Development initiative, has identified the potential for a number of economic and commercial activities, notably heavy industry, oil refining, petrochemical processing, mineral, small and medium scale manufacturing, logistics, warehousing, fisheries, and so on.

On a more modest scale is the Al Mazyounah Free Zone straddling the Oman-Yemen border at Mazyounah. Administered by the Public Establishment for Industrial Estates (PEIE), the newly established facility is expected to attract investments in small-scale ventures that will spur cross-border trade between the two countries.

By Conrad Prabhu

© Oman Daily Observer 2010