Oman's investment climate

Oman is an economically, politically, and socially stable country in the Middle East and North Africa. Furthermore, Oman has a modern commercial legal system, respects free market principles, enjoys a favorable geographical location, a business-friendly environment, and ensures the sanctity of contracts and respect for property rights. Oman boasts relatively low taxes, an educated and largely bilingual workforce, modern transportation infrastructure, and a favorable environment for investors.

Why Oman

• Strategically advantageous location

Located at the very center of the interaction of European, Asian, and African markets.

• Political and economic stability

Oman's political and economic stability has ensured policy consistency and a reliable investment climate.

• Trade agreements

The country has: WTO agreements, the Gulf Common Market Agreement, the GAFTA agreement, as well as free trade agreements with the United States, Singapore, Iceland, Norway, Switzerland, and Liechtenstein.

• Repatriation of capital and profits

No restrictions repatriation of capital or profits, currency exchange, or dividend remittance.

• Diversification

The government places special emphasis on diversification, industrial development, and privatization to reduce dependence on hydrocarbon revenues.

• Transparent legal system

Investor-friendly legal environment.

• Foreign ownership

100% foreign ownership in free zones and certain sectors.

• Taxation

No income tax for individuals, low corporate income tax rates, and double taxation agreements with many countries.

• Infrastructure

Modern infrastructure, including world-class roads, airports, seaports, and free economic zones.

Oman Vision 2040

"Without a strong start, there is no solid foundation." This well-known Omani proverb embodies the essence of Oman Vision 2040—an ambitious action plan that defines how Oman can remain competitive and advanced in the future.

Developed through extensive consultation with Omani citizens, Vision 2040 Enshrines the principles of a diversified and resilient economy less dependent on oil and fosters a globally integrated and prosperous society. Beginning under the leadership of the late Sultan Qaboos bin Said and culminating in the meticulous planning of Sultan Haitham bin Tariq, the program provides a roadmap for how Oman can adapt to changing economic conditions, cultural shifts, and disruptive technologies to position the country for economic diversification, sustainable development, and global competitiveness.

Oman's sustained progress under Vision 2040 serves as a model for other developing economies overcoming uncertainty through long-term planning. The program also promotes Oman's global engagement and partnerships with organizations such as the World Bank.

At the core of Oman Vision 2040 is the need to diversify the economy and build a knowledge- and technology-based economy. In practice, this means investing in digital infrastructure, encouraging R&D, and developing new industries. Extensive regulatory reforms have been implemented to stimulate private sector growth and attract foreign investment. Attracting foreign direct investment and strengthening the private sector are key components of the strategy.

Oman is also leveraging its strategic geographic location to become a logistics and trade hub. Situated beyond the Strait of Hormuz on major global trade routes, it prioritizes the modernization of ports, free zones, and airports. The development of Duqm—a vast special economic zone with a deep-water port—and the modernization of the ports of Salalah and Sohar exemplify this commitment. Such investments are aimed at optimizing the flow of goods and making Oman a vital link in global supply chains.

The first results of the economic transformation are already visible: non-resource sectors such as construction, manufacturing, and transportation are growing rapidly. Maintaining this momentum will require sustained reforms, and Oman's multifaceted approach—from startup incubators to industrial free zones—is steadily transforming the economy.

Sustainability is a fundamental principle, and Oman's fisheries sector is a shining example of this success. Fisheries have evolved from a traditional, artisanal industry into a technologically advanced one that fosters diversification. The government, with support from the World Bank, has developed a vision for the development of fisheries and aquaculture, aiming to create a profitable, world-class sector that is environmentally sustainable and makes a significant contribution to Oman's economy.

Human capital development is another key element of Oman's vision. A skilled, educated population is the foundation of competitiveness. Education reforms are underway to align curricula with future labor market needs and improve the quality of education at all levels. Oman's ambitions include ranking among the top 20 countries in global education indices by 2030 and among the top 10 by 2040. Investments in schools and universities over the past decades have significantly expanded access to education. The number of public schools has grown from 3 in 1970 to more than 1,200 today.

The focus is now on improving outcomes in science, technology, engineering, and mathematics (STEM) to develop a knowledge economy. Equally important, Oman is fostering a culture of research and entrepreneurship. Through the Ministry of Higher Education, Research, and Innovation, new programs are being implemented to fund research and the commercialization of ideas.

In partnership with the private sector, innovation parks and incubators have been created to support startups and develop student projects into commercially successful products. Aspiring young entrepreneurs are supported through financial incentives and training programs, often jointly sponsored by government and industry. Public-private partnerships are helping to create this innovation ecosystem— For example, tech companies are partnering with Omani colleges to establish coding academies, and energy companies are investing in technical training centers.

These efforts are bearing fruit: Muscat is experiencing a thriving startup scene, and the number of Omani tech SMEs is growing. At the same time, Oman is working to make its labor market more flexible and dynamic, implementing new labor policies that provide additional benefits for women and encourage the employment of Omanis in the private sector. With 64% of the population under 30, all of these measures aim to capitalize on Oman's demographic dividend by equipping young people with skills and opportunities for innovation.

To ensure the successful implementation of Oman Vision 2040, Royal Decree 100/2020 established a specialized body—the Oman Vision 2040 Follow-up Unit. Reporting directly to the Council of Ministers, this unit plays a central role in monitoring progress in strategy implementation, facilitating coordination across sectors, resolving problems, and providing strategic support to align efforts with the national strategy.

Key Investment Authorities

Investors in Oman need to interact with several important institutions:

• The Ministry of Commerce, Industry and Investment Promotion (MoCIIP) is the main coordinating body for trade and investment.
• The Oman Investment Authority (OIA) is the sovereign wealth fund and investment management arm of the government.
• The Authority for Special Economic Zones and Free Zones (AIZFZ) is responsible for the management of free zones and special economic zones.
• Invest Oman Administered by the Ministry of Commerce, Industry, and Investment Promotion (MOCIIP), Oman's official investment marketing initiative offers support services and assistance to investors.

Oman actively attracts foreign direct investment and is in the process of improving its regulatory framework to encourage such investment. The Foreign Capital Investment Law (FCIL) allows 100% foreign ownership in most sectors and eliminates the minimum capital requirement. The law effectively provides all foreign investors with an open market in Oman.

The Omani government's Intrinsic Value (IV) policy aims to encourage companies, both Omani and foreign, to purchase local goods and services and train Omani employees. The government includes a demonstration of IV support by bidders as a factor in awarding public tenders. Although the government initially applied IV primarily to contracts in the oil and gas sector, it has now been implemented in public tenders across all sectors, including transportation and tourism.

Oman Investment Laws

Competition and Antitrust Laws

Oman does not conduct investment screening for antitrust compliance, and there is no functioning competition commission. The Competition and Antitrust Law aims to combat monopolistic practices by prohibiting anticompetitive agreements and price gouging. It includes a reporting requirement for any activity, such as mergers and acquisitions, that results in one firm achieving a dominant market position. The Center for the Protection of Competition and the Prevention of Monopolies, under the supervision of the Ministry of Competition and the Prevention of Monopolies, ensures compliance with the law. Furthermore, Ministerial Decree No. 18/2021 implemented the implementing provisions of the Competition Law.

Expropriation and Compensation

In the event of nationalization of property, according to Article 11 of the Basic Law of the State, the Omani government is obliged to pay prompt and fair compensation.

Dispute Settlement

ICISID Convention and the New York Convention

Oman is a party to the International Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICISID) and the 1958 United Nations New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

Investor-State Dispute Settlement

Oman has a modern arbitration law, largely based on the UN Commission on International Trade Law model. Under Omani arbitration law, an arbitration agreement must be in writing and may be executed in one or more documents. The parties are free to choose the law governing the arbitration agreement, and in the absence of direct law, the courts have the authority to render a decision. Furthermore, dispute resolution mechanisms included in free trade agreements can help Omani and foreign companies resolve disputes outside the Omani legal system.

International Commercial Arbitration and Foreign Courts

The Omani Arbitration Law (Royal Decree 47/97, ​​as amended) defines "arbitration" as a dispute resolution mechanism freely agreed upon by the parties. Typically, the parties specify in their initial agreement that any dispute will be resolved by arbitration, in accordance with, for example, the Omani Arbitration Law. The law requires that the arbitration agreement be in writing. Parties may also agree in writing, after a dispute has arisen, to resolve it through arbitration. However, in such cases, the agreement must specify the main issues that the parties agree to resolve through arbitration.

The Oman Commercial Arbitration Centre (OAC) is an independent and financially autonomous arbitration body operating under the auspices of the Oman Chamber of Commerce and Industry. According to the OAC rules, parties may represent themselves in arbitration through their authorized representatives, select experts in the subject matter of the dispute, and file claims and counterclaims within pre-agreed time limits.

The Government of Oman recognizes mandatory international arbitration for investment disputes involving foreign investors. Oman's legal framework provides for the enforcement of international arbitration awards, and most foreign companies choose to resolve disputes through arbitration.

Right to Own Real Estate and Land

Oman prohibits non-Omani citizens from owning real estate and land in various governorates and certain restricted areas. Foreigners may purchase real estate only in designated areas called "integrated tourism complexes" and in specific high-rise commercial and residential buildings designated by the Ministry of Housing in Muscat, subject to meeting criteria. Oman permits the establishment of real estate investment funds (REIFs) to attract new investment into the country's real estate sector. Foreign investors, as well as expatriates residing in Oman, may own shares in REIFs.