Duqm's Special Economic Zone (SEZAD) in the Sultanate of Oman Oman aims to position itself as a logistics hub, investment address, and business and tourism destination to support the nation’s economic diversification. It has significant untapped potential to drive economic growth and diversification, as well as serve as a catalyst of socio-economic development in the central region of Oman.
Duqm's strategic location and vast area have made it a vital link in international trade routes due to globalization drivers related to production and global supply chain factors. The logistics sector is a crucial strength of Duqm due to its strategic location overlooking expansive waterways close to the African, Indian, and Asian markets. This advantage positions Duqm as a prime location for Omani and Gulf products to access these markets with significant growth potential. The Empty Quarter border crossing strategically creates a direct land corridor to transport the Gulf country's oil and gas through Omani territory. Expanding Duqm's territory can lower costs and transit times by bypassing dangerous waterways, boosting competitiveness.
Oman's strategic location and history as a trade hub, underpinned by a free trade agreement with the United States, positions it as a vital regional and international commerce center. In addition, Oman’s' fisheries sector — Al Wusta Governorate in particular — offers abundant stocks and access to the Indian Ocean. To fully capitalize on this renewable resource, the country requires a strategic partner capable of opening markets, including Saudi Arabia, and injecting financial investments to improve efficiency. Duqm also boasts high-quality stocks of various minerals and other sectors.
The Duqm Special Economic Zone is gaining attention locally and globally due to its strategic location on the Arabian Sea, proximity to international shipping lanes, and attractive incentives and exemptions for investors. It offers a variety of investment opportunities, suitable land for projects, and exemption from customs and income taxes for up to 30 years.
To name a few of the current investments: hydrogen/ammonia projects, Karwa Motors, Oman Hong Tong Piping, Duqm Refinery, and the petrochemical joint venture SABIC, OQ and Kuwait Petroleum International (KPI). Investment opportunities in Duqm span the refinery, petrochemicals, storage and assorted heavy, medium, and light industries.
Other sectors with investment potential include transport and logistics, tourism and hospitality, healthcare, education, real estate development, sports facilities, mining, and fish industries. Commercial and residential complexes, markets, and educational institutions are attractive investment options as well.
Duqm has a significant geographic advantage in Oman and the broader GCC region. Investors typically seek government and political stability, robust infrastructure and communication, access to natural resources, reliable transportation, skilled labor, attractive tourist attractions, and residential benefits when considering investment opportunities. The Duqm region offers critical conditions, making it an appealing destination for investors. It offers a balanced environment that meets the needs of both businesses and inhabitants. The Public Authority for Special Economic Zones and Free Zones (OPAZ) should develop a game plan that makes business and life in the area enjoyable, aspirational, and productive. The game plan should create a comfortable environment offering residents various lifestyle options while providing simple pleasures forgotten in overdeveloped countries.
Oilfields in the hinterland of Duqm must also utilize Enhanced Oil Recovery (EOR) to attract investors, as Oman has become a leader in applying advanced oil extraction technologies. Application of EOR has a 30% to 60% production return contributing to energy-led growth. The technique includes steam injection, chemical injection, and gas injection.
Duqm can be the hub for providing extraction technology to countries facing challenges like Oman. As most oil fields are in Al Wusta, OPAZ should prepare to offer services and technology to these regions, thinking creatively to meet their needs.
Duqm strives to be a top global green hydrogen hub thanks to favorable factors such as ample land, high sun exposure, strong winds, vast coastlines, and proximity to energy markets, all of which make Oman an ideal location for green hydrogen.
Subsequently, selecting green hydrogen as a key sector for development and Duqm will play a critical role in realizing the potential of the sector for Oman by becoming a location of choice for manufacturing/cluster development for wind and solar equipment and servicing, green hydrogen production clustering and associated industries and of course hydrogen storage and distribution.
Equally, the supply of hydrogen that will be delivered also allows Duqm to offer traditional industries a green and sustainable energy mix that will help attract value adding green steel downstream manufacturing activities.
Duqm has solid political support and is an independent regulator with good governance practices. It offers various opportunities for downstream activities, refinery and petrochemical investments, and tailored services for foreign investors. Traditional tools and roles must give way to a paradigm shift to overcome many challenges in the new normal.
Three aspects are essential to achieve the paradigm shift: Strategic analysis, creativity, and operational excellence.
In conclusion, Duqm is a unique investor investment opportunity. A strategic approach tailored to the industry, leveraging regional advantages, prioritizing customer satisfaction, talent acquisition, anchor projects, investment funds, heavy industries, petrochemicals and minerals, green energy, infrastructure, and stable regulations, is crucial for fully capitalizing on this opportunity. With the suitable strategy, Duqm can become a top investment destination, driving economic growth, creating jobs, and contributing to the Oman's development.
Dr Yousuf Hamed al Balushi
yousufh@omaninvestgateway.com
www.omaninvestgateway.com
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