In a bid to invigorate its economy, Oman‘s Sultan Haitham has decreed the establishment of the Khazaen Economic City, complete with two free economic zones, as confirmed by the Oman News Agency on Monday. Located within the South Al Batina Governorate, the new city will be administered by the Public Authority for Special Economic Zones and Free Zones.
These pioneering initiatives will come to life under the management of Oman Logistics Company, tasked with operating both Khazaen Economic City and its two embedded free zones. The responsibility for developing these economic areas falls to the Khazaen Economic City Company.
This ambitious move comes as Oman intensifies its economic diversification strategy, buoyed by favourable oil prices, prudent fiscal reforms, and the containment of inflation, as reported by the International Monetary Fund last month.
Despite anticipating a budget deficit of 1.3 billion rials in 2023, accounting for 3% of its economy, Oman enjoyed a surplus of 1.14 billion rials the previous year, according to the nation’s Ministry of Finance.
To galvanise the country’s economic rebound from the COVID-19-induced slowdown, Oman launched a three-year fiscal stability programme last October. This scheme is designed to spur the Sultanate’s financial sector and facilitate national economic recovery.
Further bolstering its economy, Oman has recently signed several agreements with its Gulf Cooperation Council (GCC) counterparts. These include a $3 billion railway project linking the Sultanate with the United Arab Emirates and a $320 million infrastructure development endeavour, backed by the Saudi Fund for Development.
Oman’s efforts have not gone unnoticed by international observers. In April, Fitch Ratings revised its outlook for the country from stable to positive, maintaining its “BB” rating. The agency cited a surge in oil revenue and a reduction in public debt as key contributors to this positive trajectory, reflecting the government’s commitment to fiscal consolidation.