Doing business in Oman

The Sultanate of Oman is strategically located in the southeastern corner of the Arabian Peninsula, at the confluence of the Persian Gulf and the Arabian Sea. With an area of 309,501km2, it boasts a coastline of approximately 3,165km, making it the third largest country on the peninsula. It shares land borders with Saudi Arabia, the United Arab Emirates (UAE) and Yemen, and maritime borders with Iran and Pakistan.

Oman is a monarchy, led by His Majesty Sultan Haitham Bin Tariq. The country’s capital is Muscat and while Arabic is the official language, English is widely used in business settings. Additionally, Oman is an Islamic nation and follows a Sunday to Thursday working week.

The official currency is the Omani Rial (OMR), pegged to the US Dollar at a rate of OMR 1 = USD 2.6. It has a population of about 5.21 million, comprising 2.96 million Omani nationals (approximately 56.8 percent) and 2.25 million expatriates (around 43.2 percent).

For the fiscal year 2024, the state budget estimates OMR 7.49 billion from oil and gas revenues, which represents roughly 68 percent of total revenues, and OMR 3.52 billion from non-oil and gas sources (approximately 32 percent). The country’s credit rating is BB+ with a positive outlook from Standard & Poor’s, Ba1 with a positive outlook from Moody’s, and BB+ with a stable outlook from Fitch. In 2019, Oman was ranked 53rd in the World Economic Forum Global Competitiveness Index, 68th in the Ease of Doing Business Index, and aims to be in the top 10 countries in the Ease of Doing Business Index by 2040.

Economic zones

Until 2022, Oman had one special economic zone, Duqm, and three free zones, Sohar, Salalah and Al Mazunah. Each zone offers several incentives (including tax incentives), subject to specified conditions. The incentives are not necessarily automatic and may need to be applied for separately. The Royal Decree 10/2022 issued on 2 March 2022 established three new free zones, Muscat International Airport Free Zone, Sohar Airport Free Zone and Salalah Airport Free Zone

Duqm Special Economic Zone

Spread over 2,000km2 with a 90km coastline along the Arabian Sea the Duqm Special Economic Zone is divided in key zones that include the Port of Duqm, Oman Dry Dock, Duqm Airport, Duqm Refinery, industrial, fisheries, tourism and renewal energy zones. It offers, among others, usufruct agreements of up to 50 years renewable for another 50 years, full foreign ownership and no minimum capital requirement, subject to conditions specified. It also offers customs exemption, corporate income tax exemption of up to 30 years (renewable for another 30 years) and value added tax (VAT) suspension, subject to conditions specified.
Sohar Free Zone

Spread over 65km2 the Sohar Free Zone is divided in key zones that include metals clusters, petrochemical cluster, logistics cluster and food cluster. A 50:50 joint venture between the Port of Rotterdam and Oman, it offers, among others, long term leases for industrial or logistics use and full foreign ownership. It also offers customs exemption, corporate income tax exemption of up to 25 years and VAT suspension, subject to conditions specified.
Salalah Free Zone

Located 5km from the Port of Salalah and 12km from the Salalah International Airport, the Salalah Free Zone is strategically located to offer proximity to Africa, Asia and the Middle East. It offers, among others, full foreign ownership and no minimum capital requirement, subject to conditions specified. It also offers customs exemption, corporate income tax exemption of up to 30 years and VAT suspension, subject to conditions specified.
Al Mazunah Free Zone

Spread over 14.5km2 the Al Mazunah Free Zone is managed by the Public Establishment for Industrial Estate (Madayan). It offers, among others, full foreign ownership and no minimum capital requirement, subject to conditions specified. It also offers customs exemption, corporate income tax exemption of up to 30 years and VAT suspension, subject to conditions specified.