ESTATE OF AFFAIRS

Oman 2015 | INDUSTRY & MINING | INTERVIEW

TBY talks to Hilal bin Hamad Al Hasani, CEO of the Public Establishment for Industrial Estates (PEIE), on attracting investment, supporting local development, and establishing new opportunities.

Hilal bin Hamad Al Hasani
BIOGRAPHY
Hilal bin Hamad Al Hasani is the CEO of the Public Establishment for Industrial Estates (PEIE), a leading government organization that manages several industrial estates across the Sultanate of Oman. Knowledge Oasis Muscat, the first technology park in the country, Al-Mazyuna Free Zone, the National Business Centre, the Industrial Innovation Centre and Shumookh (investment arm of PEIE) are the other institutions under the PEIE. Hilal holds a Bachelor’s degree in Business Administration and a Master’s in Economics. He has had management training at Harvard and the London Business School.

What have been the main successes of the Public Establishment for Industrial Estates (PEIE) over recent years?

The investment climate in Oman today is really fantastic for foreign investors looking to come in and set up their projects. That is why PEIE has already achieved most of what had been highlighted during the initial plans. We have received almost OMR4.6 billion worth of investments. We have an existing seven industrial areas and a free zone close to the border with Yemen. Because of the investment attractions here, we have expanded and we have added the Smail Industrial Estate, 35 kilometers from Rusayl. This is in the final stage, and we now have more than 80% occupancy. The total infrastructure cost is more than OMR70 million, but the most important aspect of these achievements is job creation. One of our achievements for attracting investments, local or foreign, was to have in-country value (ICV). And in terms of ICV, one of the most important aspects is employment. Here, we have expanded our Omanization rate to approximately 41% by mid-2014.

What kind of support is PEIE offering to the development and consolidation of SMEs in the country?

PEIE serves SMEs first and foremost. PEIE has initiated an innovating program called the National Business Center, which was established in 2011. Its aim is to help and support locals to build their ideas, support them, and put them in touch with the Oman Development Bank (ODB). There are some successful stories of companies growing under the PEIE, which started their business and developed from our incubation program to then set up their own projects. If we are able to support many of these every year, we will probably be able to have more than 50 companies, all with five to 10 Omanis working in them. Then, we are really solving a problem. We are creating and promoting a new business culture and encouraging entrepreneurship in the country.

What are the main obstacles that SMEs and local entrepreneurs face here when starting a business?

When setting up a business in Oman, there is a lack of experience among locals. It is mainly about a lack of finance and management talent. Today, the government is fully supportive and is providing different types of finance, grants, and loans for these businesses. Also, the majority of the people setting up businesses now are graduates, and the local institutions are helping and supporting them in the market in terms of management and finance. All of this will help these SMEs succeed and grow.

How is PEIE contributing to providing a welcoming environment for foreign investors in Oman?

In certain areas, foreigners can own up to 70% of a company. There is also a law that stipulates that, in the first five years, businesses are tax-free and can enjoy customs exemptions on imported raw materials, goods, and spare parts. Besides that, we have some of the best infrastructure around. Oman is not just a business hub; it is a place where you can come and live. There are several factors aside from just incentives that give Oman more benefits than neighboring companies for people to come to and set up a business. There are multiple opportunities in the country, including downstream, which is about building up correlations with some of the large projects, while the railway project is one of the largest areas of investment. Also, Duqm will provide many opportunities. Oman is one of the best areas for people to come and invest, and the bulk of investment is from either the Indian subcontinent or from other Arab countries. These are the areas where our foreign investment is coming from. This gives Oman opportunities to re-export, as the country has good FTAs.