Thursday 17 January 2019

Officials at the press event

PEIE offers new investment incentives

MUSCAT, February 14, 2018

Oman’s Public Establishment for Industrial Estates (PEIE) has revealed a line-up of new incentives offered to existing and potential investors.

The press conference, at the Crowne Plaza Muscat, was held under the title of ‘Strengthening Partnership with the Private Sector’.

Hilal bin Hamad Al Hasani, chief executive officer of PEIE, said that under the new legal frameworks, all prior approvals for the acceptance of investment have been cancelled, and usufruct or leasing rights will be as per requirements related to practicing investment activity.

This will allow the approval of investment application and signing of investment contracts to be finalised within a maximum of 10 days, he said.

“Taking into consideration the developments and changes that have been witnessed during the past period, especially with regard to the recurrent financial crises since mid-2008 as well as the rapid decline in oil price over the past four years and the consequences on various sectors; this has made us consider restructuring its legal system, re-engineering all its operations to ensure regional and global competitiveness by attracting foreign investments and preserve the national investments,” he added.

“In addition to that, we have considered its industrial estates to act as business incubators and maximise the advantages of the international conventions and international cooperation agreements related to tax aspects and non-duplication of tax payment among states, absence of restrictions or preferential requirements for national investment or national products, treatment of investments and persons alike,” he said.

“We have an integrated legislative guide to act as a base for local and foreign investment, regulate the relationship between us and the investor, as well as regulate the relationship with all parties involved in the investment process,” he added.

Al Hasani continued: “The Royal Decree no. 32/2015 promulgates the system (law) of PEIE. Under it, the investment regulations and regulations on violations and sanctions, which constitute an integrated legislative system, were issued.”

For the 10th year in a row, PEIE has achieved growth seen through the indicators. The preliminary figures for the year 2017 show that the volume of investments in the various industrial estates has touched RO6.32 billion ($16.41 billion), noting a growth rate of 5.5 per cent. The volume of investments increased by around RO329 million ($854.5 million), which makes the total volume of investments around RO6.32 billion ($16.41 billion) compared to RO6 billion ($15.5 billion) by the end of 2016.

The number of manpower in the industrial estates pertaining to PEIE has touched 55,000. The number of the manpower has increased by nearly 10 per cent during 2017, as around 4,740 job opportunities were offered in the investment projects in the industrial estates.

This increase makes the total number of the manpower around 55,000 compared to 50,000 by the end of 2016, noting that the Omanisation rate has touched 35 per cent.

By the end of 2017, the total number of projects has amounted to 1,873 in various stages of implementation; of which 64 per cent of these projects are existing, 20 per cent have been allotted with spaces, and work is underway to establish 16 per cent of the projects. It should be noted that 62 per cent of these projects are industrial, 27 per cent are commercial and 11 per cent are service projects.

The PEIE has also managed to lease more than 695,000-sq-m of the lands in the various industrial estates to investors during 2017. By the end of 2017, the total leased area has touched approximately 34 million-sq-m.

Al Hasani emphasised that through PEIE’s medium and long term plans, it has concentrated in cooperating and partnering effectively with the private sector in such a way to enhance its role and contribute to a comprehensive and sustainable economic and social development of the country.

Based on this approach, Al Hasani informed that PEIE has adopted a programme to strengthen partnership with the private sector in the area of constructing, managing and operating the industrial estates and the economic areas pertaining to PEIE. This programme includes three main aspects. The first is to attract major developers to all the new industrial estates and PEIE to not invest directly in the development process.

The second aspect is related to opening the way for the private sector to work under the umbrella of PEIE as owners and developers of the economic areas of a variety of investment activities. Finally, the third aspect of the programme is related to the establishment of a holding company owned by PEIE to develop and manage the existing industrial estates.

In implementation of the first part, PEIE will open investment opportunity in the new industrial estates located in a number of wilayats during the years 2018 and 2019 for the local and foreign private sector.

In the coming period, PEIE will attract local and international industrial developer to invest in the construction, management and operation of specialised investment areas. PEIE has worked on establishing rules, procedures and legislative frameworks that grant developers with a lineup of incentives and clearly define their rights and duties, which include granting them usufruct contract for up to 99 years.

As for the second part of the programme and in order to increase the expansion of economic areas, work is underway to develop controls to grant approvals for the private sector to establish areas owned by it or it owns the rights to use its lands from the competent authorities and outside the lands of PEIE.

Moreover, PEIE aims at benefiting from the international and regional expertise in the fields of construction, management and operation of economic areas.

Al Hasani added: “This will open the way to attract international operators for the estates and public facilities, in addition to have contracts with them through agreements that last for a period up to 25 years. This will eventually increase the competitiveness of the industrial estates in Oman and create an integration of activities within the industrial community through applying the best management practices.”

He continued: “As for the third part of the programme, we announce today the establishment of Oman Investment and Development Holding Company, which is wholly owned by PEIE and will take over the process of constructing, managing and operating the existing industrial estates.”

“The company will establish companies for development and companies for management and operation for the existing industrial estates through partnership with specialised operators in this field. It is hoped that the company will commence its operations during the second half of 2018. A time-plan has also been prepared to transfer the existing industrial estates to the holding company gradually, which will take into consideration not to affect negatively on the offered services to the companies, investors and clients,” he stated. – TradeArabia News service

Tags: | investment | Incentives | PEIE |

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