Oman’s free zone in the south has generated foreign direct investment (FDI) of $3.5 billion in the last three years and is heading towards its FDI goal of $15 billion, a senior official of the enclave has told Gulf Industry.

Salalah Free Zone chief commercial officer Ali Tabouk also said that the Omani Government had invested $130 million in Phase 1 development and some 1,222 jobs had been created for the local workforce.

The free zone currently covers 18 sq km and Phase 1 of its construction has been completed. Tenant companies number 18 but only seven are fully operational.

“With more and more big-name tenants joining the Salalah Free Zone, other leading global companies are sitting up and taking notice of the benefits of following suit,” said Tabouk, who listed the hub’s benefits to include well-developed air, sea and land links, a cost competitive market reach plus a strategic location between East and West trade routes.

Companies that are fully operational are Salalah Methanol Company, Octal, Global Gypsum Board and Associated Industries India (listed under the chemicals and material processing cluster) and ABI Showatech Oman, Sapphire Marine and Dunes Oman (manufacturing and assembly cluster). Salalah Free Zone is seeking tenants in those sectors as well as in logistics and distribution. The park offers a mix of industrial, manufacturing, warehousing, logistics, distribution, R&D and office facilities.

Salalah Port in the South of Oman is a vital gateway for trade linked to the nearby Salalah Free Zone

Star tenant at the free zone is Octal which recently gained capability to produce annually 1 million tonnes of PET bottle-grade resin with the commissioning of two of the world’s largest vertical reactors, making it the largest PET producing site in the world at a single location. “This singular achievement was enabled by the infrastructure benefits offered by Salalah Free Zone to its tenants,” said Tabouk.

One of Salalah Free Zone’s objectives is to encourage environmentally friendly establishments. Tabouk said development of green technologies was a “strategic plan.” “More specifically, the Salalah Free Zone is keen on becoming the regional hub for alternative energy, using its geographic location as its USP. Centrally located on key global trade routes, it is well placed to act as an assembly point for both regional and international green products such as wind turbines or solar arrays destined for the GCC region and wider Indian Ocean and surrounding countries such as Africa and India,” the official said.

The free zone’s marketing pitch highlights its location in Oman’s “conducive and competitive business landscape,” its strategic location offering ease of access to the Middle East and major markets of the world and its position at “the centre of a regional industry worth $620 billion and a further $2 trillion worth of goods passing through Oman each year.”

It also offers “a comprehensive ecosystem” to companies engaged in distribution, material processing and assembly and who would like to capitalise on Oman’s diverse minerals wealth.

Salalah Free Zone has grown around the modern Salalah Port which serves five leading global shipping lines
and is close to Salalah International Airport where expansion is underway. Salalah will also be linked to a GCC railway network.

Phase 2, currently under construction, will offer a further 265 hectares of facilities similar to Phase 1 (200 hectares) but will focus on light and medium industrial units. It will also a house a state-of-the-art free zone headquarters designed to be home to investor offices and to house conference, exhibition and other facilities.