Duqm, Oman

When it comes to the Sultanate of Oman, Muscat and its suburbs draws the bulk of the country's real estate investment and tourism, due to its proximity to the UAE and location on the Gulf of Oman. With the return of Donald Trump to the White House, the Trump International Golf Resort in Muscat is expected to receive more VIP visitors. Aside from already priced-in property developments along the coastline near the Trump International, there's another spot in Oman that could offer foreign investors solid returns, starting from a significantly lower land investment cost base. And it's located about 5 1/2 hours drive or 546 km (339 miles) to the south.

What initially was simply a small fishing village on the Arabian Sea in the remote Al-Wusta governorate of Oman, is rapidly developing within the largest special economic zone (SEZ)by territory in the entire Middle East and North Africa (MENA). Duqm is emerging as an important SEZ with its oil terminal and petrochemical port, as well as a future tourist stopover for cruise ships sailing around the Arabian Peninsula.

Let's begin with some basic facts about the city of Duqm, before we discuss the geographically quite large SEZ.

The population of Duqm does not exceed 12,000 people as recorded in the last census of 2017. But it's projected to reach 25,000 by the end of 2024. With the economic opportunities in the SEZ and expanding investments, the population could easily reach 100,000 by 2030. The SEZ itself is expected to provide over 30,000 jobs by 2030.

The city is mostly known for three things—the Duqm Port and Special Economic Zone, the Duqm Oil Refinery, and several natural landmarks and reserves. These include the Ras Madraka Beach and Al Wusta Wildlife Sanctuary. From a tourism perspective, it's a gateway to rugged and beautiful coastline.

Now, with regards to the SEZ and its future–

Oman has a vision–just like several other countries–called Vision 2040. The authorities determined that Oman being a petrostate like several other Gulf Cooperation Council nations needs sustainable development for future generations, thus, the expansive infrastructure and non-oil economic projects.

The location of this SEZ is no coincidence–along the trade route that links Africa, Asia, and Europe. With potential to become the largest port in the Middle East by size, Duqm does not depend on the Straits of Hormuz for the shipment of oil, petrochemicals or goods. Thus, if U.S./Israel tensions with Iran escalate into full-scale conflict, the economic safety of this SEZ makes it highly valuable, and contributes to the strategic neutrality foreign policy of the Sultanate.

The Zone was established in 2011, and over 13 years the city, the port, and all its facilities have kept expanding. The Zone has reached a size of 2,000 square kilometers. Including hotels and other short-term accommodations, government ministry satellite offices and the likes, it is also a global hub for companies. European and Asian companies particularly in the oil and petrochemical industries can be found in the city, although there is a noticeable lack of American companies here, and I personally think they're missing out on quite a lot of opportunities in Oman.

The Oil Refinery is also an interesting thing to note, it's processing 230,000 barrels output a day into diesel and jet fuel. The refinery is a joint investment project between Kuwait and Oman worth over $8 billion, and a facility specializing in Green Hydrogen is planned by 2026. Oman is also taking steps to capitalize on it's non-oil mineral resources, updating its mining laws in 2019 and becoming the first GCC producer of ferrochrome. Oman is also the world's largest exporter of gypsum, primarily to buyers in China and Southeast Asia. So the mining industry is likely to expand in the SEZ.

It's important to note that while the Duqm airport opened ten years ago, it is not yet accommodating international flights, presently serving domestic routes to Muscat, Salalah and Suhar. This limits the accessibility of the city and SEZ, and will be rectified by the government in the coming years with the planned expansion of the airport.

The economic facilities I talked about are quite simple–a multi-purpose port (the largest in the Middle East), a dry dock, a separate fishing port, the aforementioned domestic (perhaps soon to be international) airport, and several industrial and logistical hubs and workshops. It's also important to note that the city now has several hotels that can accommodate quite a lot of people who have come by as tourists or even temporary workers, so the comfort of the workers and the managers is also guaranteed. The channels between the port authorities and prospective investors are active and allow for easy communication. Thus, regulations are structured around the retention and growth of firms to anchor their investments in the Sultanate.

The benefits offered by the Special Economic Zone are quite plentiful. Including the possibility of obtaining Omani residency through investment in qualified residential properties. It's possible to have 100% foreign ownership of your firm inside the economic zone, and all internationally recognized currencies are allowed to flow through the port–including GCC currencies the Emirati Dirham, Kuwaiti Dinar etc. You are also exempt from taxes for up to three decades for the starting date of your firms operations in the SEZ, you are also able to usufruct your assets and firm for up to 50 years, which is renewable.

You are also exempt from minimum capital requirements, as this is an SEZ, you have the full and free right of repatriation of profits and capital, exempted from duties on importing raw materials.

Besides the merchant marine and fishing fleet ports, there's also excellent road transport to and from Duqm. Route 32 and 31 links the city to Muscat and all the major cities in Oman and the GCC. The highways are quite improved compared to a decade ago and are of a high quality. There are future plans to establish rail travel to further advance the logistical capacity of the zone, with trains carrying freight cargo and passengers, connected to the broader rail network of the GCC.