Salalah Free Zone: Investment Opportunities, Benefits & Setup Process (2025)

The Strategic Imperative of Sohar

Sohar’s geographical position is its most significant asset, granting it a unique competitive edge in regional and global trade:

• Location Outside the Strait of Hormuz: This is a critical advantage. Being situated outside the congested and geopolitically sensitive Strait of Hormuz significantly reduces transit times, avoids potential bottlenecks, and lowers insurance premiums for cargo, making it a more secure and efficient gateway to the region.

• Gateway to Global Markets: Sohar offers direct access to the lucrative markets of the GCC (Gulf Cooperation Council), the Indian subcontinent, East Africa, and beyond. Its deep-sea port can accommodate the world’s largest ships (e.g., Valemax-class ore carriers), facilitating efficient import and export of various cargo types.

• Exceptional Connectivity:

  • Road Network: Excellent highway connections link Sohar to Muscat, the UAE (Dubai, Abu Dhabi), and a rapidly developing road network to Saudi Arabia, ensuring seamless overland movement of goods.

  • Air Connectivity: Proximity to Sohar Airport and efficient connections to Muscat International Airport expand its logistical reach for air cargo and passenger travel.

  • Future Rail System: The ongoing development of the Hafeet Rail (a $3 billion collaboration between Etihad Rail and Oman Rail) will integrate Sohar with the UAE’s rail network, promising to significantly enhance logistical efficiency and reduce travel times to major regional hubs.

World-Class Infrastructure & Facilities

Sohar’s commitment to industrial and logistical excellence is evident in its advanced infrastructure:

• Deep-Sea Multi-Purpose Port: Equipped with state-of-the-art terminals for containers, dry bulk, liquid bulk, gas, and general cargo, operated by leading global partners like Hutchison Ports Oman, Vale Oman, Oiltanking & Co Terminals, and C. Steinweg Oman.

• Extensive Free Zone Area: A sprawling 4,500-hectare development designed to support diverse industrial and commercial activities. Phase 1 is nearing full occupancy, with Phase 2 expansion already underway to meet surging investor demand, adding approximately 500 hectares of leasable land.

• Ready-to-Use Facilities: Sohar Free Zone offers a range of immediate solutions including pre-built warehouses, light industrial units, and high-quality commercial offices.

• Reliable Utilities: Guaranteed access to low-cost energy (electricity, gas) and water, crucial for energy-intensive industries. Sohar is also actively pursuing solar power projects with partners like Shell, dedicating significant land for PV installations to ensure sustainable and cost-effective energy supply.

• Bonded Corridor: A unique integrated complex with a streamlined management structure and a bonded corridor between the port and free zone, allowing goods to transit in just 14 minutes, significantly boosting efficiency for logistics operators.

Recent Developments & Future Outlook (2025 Onwards)

Sohar Free Zone is not static; it’s continuously evolving to meet global demand:

• Major Expansion Plans: With Phase 1 nearing full capacity (over 85% leased), Sohar Free Zone has unveiled ambitious expansion plans for Phase 2, which will add another 500 hectares of leasable land and attract over $5 billion in new investments. This expansion is projected to create hundreds of new jobs and significantly increase throughput.

• Unified Legal Framework (Royal Decree 38/2025): The recent enactment of the Law of Special Economic Zones and Free Zones (Royal Decree 38/2025 in April 2025) strengthens the legal and regulatory environment across all of Oman’s free zones, including Sohar. This new law introduces a unified 10-year corporate income tax exemption (renewable for two additional periods for “activities of a special nature”), making Oman’s free zones even more competitive and attractive for foreign investment.

• Significant New Investments (2024 & beyond): In 2024 alone, Sohar attracted over $4 billion in new projects, including a $1.35 billion polysilicon production facility (largest in the Middle East), the $1.6 billion LNG bunkering project, and a $600 million iron ore concentration plant. These underscore Sohar’s appeal for large-scale, innovative ventures.

• Focus on Sustainability: Sohar is actively committed to decarbonization efforts, demonstrated by initiatives like the SOHAR Net Zero Alliance and expanding the use of biofuels and hydrogen to reduce maritime emissions. This focus attracts environmentally conscious investors.

Partnering with Setup in Oman for Your Sohar Venture

Sohar Free Zone presents a dynamic and rewarding environment for international businesses. Leveraging its strategic location, cutting-edge infrastructure, sector-specific clusters, and robust incentive package, it offers a springboard for regional and global expansion.

While the advantages are clear, successfully navigating the complexities of setting up and operating within Sohar Free Zone requires expert local knowledge. Setup in Oman is your dedicated partner, offering a comprehensive suite of services tailored to your needs:

• Expert Company Formation: From selecting the right legal structure (FZE, FZC, Branch) to managing all documentation and liaising with Sohar Freezone Authority, we ensure a fast, compliant, and hassle-free setup.

• Streamlined Visa Services: We facilitate investor visas for owners and work visas for your team, ensuring smooth relocation and legal employment.

• Corporate Bank Account Opening: We assist in establishing your corporate bank account in Oman, essential for managing finances and capitalizing on Sohar’s financial environment.

• Ongoing PRO Services: Our Public Relations Officer (PRO) services provide continuous administrative support, handling license renewals, government liaison, and ensuring ongoing compliance with Sohar Free Zone regulations.