Economic Committee reviews Progress on the Logistics Strategy 2040 and discusses enhancing SME financing and supporting the investment Environment

     The Economic and Financial Committee of the Shura Council discussed a number of issues related to economic development and the enhancement of the investment environment during its meetings with specialists from Khazaen Economic City, affiliated with the Public Authority for Special Economic Zones and Free Zones (OPAZ), Oman Development Bank, and the Small and Medium Enterprises Development Authority (SMEDA). The discussions took place as part of the committee’s review of several proposals within its jurisdiction and its ongoing efforts to support economic diversification objectives and strengthen the competitiveness of productive sectors in the Sultanate of Oman.
H.E. Ahmed Said Al Sharqi, Head  of the Committee, welcomed Eng. Salem Suleiman Al Dhuhli, Chief Executive Officer of Khazaen Economic City, praising the city’s role in attracting both foreign and domestic investments across several economic sectors identified by the government as key drivers of economic diversification under Oman Vision 2040, particularly the logistics, industrial, food, and pharmaceutical sectors.
During a visual presentation, the CEO of Khazaen Economic City highlighted the project’s key features and future plans, noting that the city represents the first integrated economic zone in Oman to be developed through a public-private partnership under Royal Decree No. 44/2023. The project is being implemented in partnership with Asyad Group under the supervision of OPAZ. He further explained that the city aims to attract investments in major sectors including logistics services, food and pharmaceutical industries, technology and business services, and clean energy, thereby contributing to GDP growth and enhancing local added value.




The presentation also outlined the investment advantages offered by Khazaen Economic City, including its strategic location within Greater Muscat and along the Al Batinah Expressway, as well as its direct connectivity to seaports, airports, and border crossings, making it a key economic and logistics hub for trade, export, and redistribution activities. The city also offers several investment incentives, such as income tax exemptions for up to 30 years, customs exemptions on imports and exports, full foreign ownership of projects, a one-stop shop for licensing and government services, developed industrial and logistics land plots, and long-term investment contracts.
The presentation further highlighted several major projects currently under implementation within the city, including Khazaen Dry Port, the first integrated dry port in Oman, which aims to connect the city with seaports and airports through modern road networks, thereby enhancing supply chain efficiency and supporting the National Logistics Strategy 2040. It also reviewed the “Salalah” Central Fruit and Vegetable Market project, modern logistics centers, an integrated labor village, and various industrial, food, and pharmaceutical projects that have witnessed the signing of dozens of investment agreements in recent periods. Khazaen Economic City recorded the highest growth rate in added investments among Oman’s special economic zones and free zones in 2025, reaching approximately 63 percent.
The committee members raised a number of questions and inquiries regarding regulatory requirements and procedures, the efforts undertaken by the economic city to attract local and foreign investments, as well as the main operational, service, and logistics challenges facing the city and the proposed solutions to address them in order to enhance the city’s competitiveness and achieve its economic and development objectives.
In another part of the meeting, the committee hosted specialists from Oman Development Bank and the Small and Medium Enterprises Development Authority to discuss a proposal concerning the evaluation of establishing a National Financing Guarantee Center for SMEs. The discussions formed part of broader efforts to develop financing tools, improve SMEs’ access to credit facilities, and enhance the sustainability of national projects.



H.E. the head welcomed the CEO of Oman Development Bank and the specialists from SMEDA, emphasizing the bank’s vital role in financing local projects and supporting entrepreneurs and SMEs. He affirmed that these entities constitute key pillars in the efforts toward economic diversification, investment stimulation, and the creation of an attractive business environment under Oman Vision 2040 through financing productive projects and promoting self-employment opportunities for citizens.
During its presentation, Oman Development Bank reviewed the Loan Guarantee Program and its operational mechanisms. The bank explained that the program aims to facilitate access to financing for SMEs and development projects by providing guarantees to banks and financial institutions, thereby reducing financing risks and improving the efficiency of the financial ecosystem. The program targets several vital sectors, including manufacturing, logistics, agriculture and fisheries, renewable energy, healthcare, tourism, and information technology, in alignment with development plans and Oman Vision 2040 objectives.
The presentation also detailed the program’s procedures, beginning with the submission of financing applications to participating banks, followed by feasibility and creditworthiness assessments, issuance of guarantees, signing agreements among concerned parties, and subsequent follow-up and claims management when necessary. The program provides guarantees ranging between 50 and 80 percent of financing value, with financing ceilings reaching up to OMR 7.5 million for certain sectors linked to development plans. It also offers facilities for both long-term and short-term financing and supports expansion and new establishment projects.
The bank further reviewed growth indicators in approved loans and financing portfolios over recent years, noting significant growth in both the volume of approved loans and the number of beneficiary projects. This reflects the expanding role of the bank in supporting the national economy and enabling SMEs to grow and expand, in addition to strengthening partnerships with commercial banks to provide more flexible and sustainable financing solutions.
Committee members also raised inquiries regarding the proposal and the bank’s role in securing national exports and local products to support the investment environment in vital sectors. Discussions also covered financing conditions, insurance ratios, guarantee mechanisms, the relationship between Oman Development Bank and commercial banks in joint financing agreements, as well as technical and procedural challenges related to loan guarantees and mechanisms for improving them to achieve greater efficiency in supporting SMEs.
On another front, the committee approved its reports regarding several proposals, including proposals on “Maximizing the Economic Benefits of Sohar International Airport,” “Launching a Program to Empower Local Brands in the Café and Restaurant Sector and Transform Them into Regionally and Globally Scalable Brands,” and “Economic Diplomacy: Impact, Outcomes, and Performance Indicators.”
The committee also discussed its observations regarding the Ministry of Commerce, Industry and Investment Promotion’s Annual Report for 2025 as part of its follow-up on the performance of economic sectors and the ministry’s efforts to attract investments, improve the business environment, and enhance the competitiveness of the national economy.
The meetings were chaired by H.E. Ahmed Said Al Sharqi, head  of the Committee, with the participation of H.E. Mansour Zahir Al Hajri, Deputy Chairman of the Shura Council, and the attendance of the committee members.