Doing Business in Oman: Why It Deserves Its Own GCC Strategy

Oman sits quietly alongside the UAE and Saudi Arabia in most companies’ GCC plans — often treated as an afterthought rather than a market in its own right. That is a missed opportunity: Oman’s Vision 2040 diversification program, its position on the Arabian Sea outside the Strait of Hormuz, and sustained infrastructure investment are creating real import and investment demand with considerably less competition than Dubai or Riyadh.

Why Oman Deserves Its Own Strategy

Oman’s economy has historically relied on oil, but the government’s Oman Vision 2040 diversification program is driving investment into logistics, manufacturing, tourism, and non-oil industry. Muscat and the port city of Duqm — positioned outside the Strait of Hormuz — are being developed as alternative Gulf logistics hubs, offering companies a route that bypasses the congestion and higher costs of Dubai’s more saturated free zones.

Company Structures in Oman

Foreign investors can register a Limited Liability Company (LLC) with up to 100% foreign ownership in most sectors under Oman’s Foreign Capital Investment Law, following reforms that removed the traditional requirement for a local Omani shareholder in most activities. Free zones at Duqm, Sohar, and Salalah offer additional incentives, including customs exemptions, for companies focused on re-export and logistics rather than domestic Omani sales.

Duqm: An Underused Gulf Logistics Alternative

The Special Economic Zone at Duqm is one of the least congested, most cost-competitive logistics and industrial zones in the wider Gulf, with deep-water port access outside the Strait of Hormuz — a genuine strategic advantage for companies concerned about chokepoint risk in their Gulf logistics planning. It remains comparatively underused relative to its infrastructure investment, which means companies establishing early operations face less competition for space, contracts, and local partnerships.

Taxation and Trade Regime

Oman applies a standard corporate tax rate of 15%, with a 5% VAT rate introduced in 2021 — both broadly comparable to, or lower than, other GCC markets. As a GCC member, Oman shares the bloc’s common external tariff framework for goods imported from outside the GCC.

Key Sectors for Foreign Investment

• Logistics and re-export — particularly through Duqm and Sohar, leveraging Oman’s position outside the Strait of Hormuz.
• Manufacturing — supported by free zone incentives and lower operating costs than Dubai or Abu Dhabi.
• Construction and infrastructure — driven by continued Vision 2040 development projects.
• Fisheries and agriculture — a growing non-oil export sector with government investment support.

How Rexapartners Helps in Oman

We support market entry and logistics coordination in Oman as part of our wider GCC coverage, helping companies evaluate Duqm and Sohar as alternatives to more saturated UAE free zones. Book a discovery call to discuss your Oman strategy.

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