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Khazaen Economic City

Khazaen Economic City

Diversifying the Economy and Fostering Growth Through Streamlined Investments

An Overview

Khazaen Economic City is an ambitious project that stands as one of the largest public-private partnership (PPP) land development initiatives in the Sultanate of Oman. It is situated in Barka, within the South Al Batinah Governorate, and holds the distinction of being the largest integrated economic city planned for development in that region.

Strategically positioned close to Muscat, the capital city of Oman, Khazaen Economic City falls under the purview of the Urban Strategy of the Ministry of Housing and Urban Planning. It is considered a crucial part of the Greater Muscat area, specifically designated as a business and urban expansion corridor.

Khazaen Economic City enjoys excellent connectivity through a robust logistics network. It is conveniently located within a 30-minute drive from Muscat Airport, allowing for efficient air transportation. Moreover, it is only a 35-minute drive from Suwaiq Port and approximately a 2-hour drive from Sohar Port, providing convenient access to maritime trade routes. These logistical advantages make Khazaen a strategic hub for trade and commerce.

The primary objective of Khazaen Economic City is to bolster Oman’s economy by establishing a worldclass integrated economic city. The city’s development plans encompass various sectors, including an inland dry port, two freezones with associated tax benefits, logistics and warehousing facilities, industrial zones, commercial districts, residential areas, and mixed-use developments.

What sets Khazaen apart from other cities is its comprehensive approach to urban planning and development. It is designed to serve as a gateway to the world, enabling Oman to harness its competitive potential and foster sustained economic growth. The city’s integrated nature encompasses all essential components, including industrial zones, logistics infrastructure, and residential areas. Additionally, Khazaen features a game-changing multi-modal transportation hub, facilitating the seamless movement of goods and people.

Khazaen Economic City has successfully attracted a significant number of investors, marking its appeal as a lucrative investment destination. To date, over 100 investment agreements have been signed, with a cumulative value surpassing 700 million USD. This impressive achievement highlights the growing interest and confidence that investors have in the city’s potential.

One notable investor that Khazaen has attracted is the Global Warehousing Company (GWC), a prominent player in the GCC region known for its extensive warehousing capabilities. Recognizing the potential in Oman, GWC has chosen Khazaen as its base to establish and expand its business operations. With their vast experience and millions of square metres in warehousing infrastructure across the GCC, their decision to invest in Khazaen is a testament to the city’s appeal and potential for growth.

Another significant investor is Naqel Express, a Saudi Arabian company that has recognised the opportunities in Khazaen Economic City. Their involvement further strengthens the city’s appeal as a preferred investment destination. The inclusion of renowned companies such as GWC and Naqel Express signifies the growing interest from established players in the region, further boosting Khazaen’s reputation and credibility.

In 2021, the Wakud factory commenced operations within Khazaen Economic City. This factory specialises in the collection of used cooking oils from hotels, restaurants, and other establishments, recycling them into biodiesel. The biodiesel produced by Wakud is utilised as fuel for trucks and buses, contributing to sustainable transportation solutions. The establishment of the Wakud factory demonstrates Khazaen’s commitment to environmental sustainability and the promotion of eco-friendly practices within the city.

Moreover, Khazaen’s ability to attract investors from 16 different countries reflects the city’s global reach and influence. The diverse origins of the investors underscore Khazaen’s broad appeal and the opportunities it offers to businesses from various parts of the world. This international recognition further strengthens Khazaen’s position as a thriving business hub and showcases its capacity to facilitate cross-border collaborations and economic growth.

Overall, Khazaen Economic City’s success in attracting a substantial number of investors, including major players like GWC and Naqel Express, speaks to its appeal as a favourable investment destination. The presence of these investors, along with the operational Wakud factory and the diverse backing from investors representing various countries, highlights Khazaen’s ability to foster economic growth, sustainability, and global business engagement.

Why Invest in Khazaen

Khazaen Economic City presents many opportunities for investors seeking to initiate their businesses in various sectors. The city offers dedicated zones such as the Khazaen Industrial and Logistics Hub, Technology and Business Park, Food City, Pharmaceutical City, Central Auto Market, commercial and residential areas, and labour villages.

Investors looking to establish industrial and logistics operations will find the Khazaen Industrial and Logistics hub to be an ideal location. It provides the necessary infrastructure and facilities to support manufacturing, warehousing, and distribution activities. It aims to enhance Khazaen competitiveness on the global trade map, support national strategies by localising industries, strengthen the internal supply network in the Sultanate and provide storage, handling, warehousing, and manufacturing solutions for investors in the light and medium industries.

The Technology and Business Park within Khazaen Economic City caters to companies involved in technology, innovation, and various service sectors. It offers a platform for research and development, IT companies, business process outsourcing, and other knowledge-based enterprises. The city provides the necessary infrastructure, including reliable connectivity, power supply, and modern amenities, to facilitate the growth of technology-driven businesses.

Food City is specifically designed to support Oman’s food security strategy by localising investments in the food sector and providing a comprehensive ecosystem for agribusinesses, food manufacturing, storage, packaging, and distribution. Investors in this sector can take advantage of the city’s infrastructure, including specialised facilities, logistics support, and a favourable business environment to establish and expand their food-related enterprises.

Pharmaceutical City aims to attract investment in the pharmaceutical and healthcare sectors. It offers a conducive environment for developing, manufacturing and distributing pharmaceutical products. The city provides the necessary infrastructure, regulatory support, and access to a skilled workforce to support the growth of the pharmaceutical industry. In addition to achieving integration between specialised and general services in the medical and pharmaceutical sectors. It comprises medical laboratories and advanced research centres, pharmaceutical and medical supplies factories and a specialised centre to store, distribute, and import medicines and medical equipment.

For automotive businesses, the Central Auto Market within Khazaen Economic City serves as a dedicated trading hub. It offers state-of-the-art facilities, showrooms, and logistics support to cater to the automotive industry’s needs. The city’s infrastructure supports the buying, selling, and trading of vehicles, promoting a vibrant automotive marketplace.

In addition to the sector-specific zones, Khazaen Economic City features commercial and residential areas, providing opportunities for investors interested in retail, hospitality, and real estate development. The city is designed to offer a balanced and sustainable mix of commercial and residential spaces, creating a vibrant urban environment.

To support the workforce requirements of the various industries, Khazaen Economic City includes labour villages. One of the solutions proposed by smart cities is to reduce road congestion as it mediates every logistics and industrial square. These villages provide accommodation and essential facilities for workers, ensuring a comfortable living environment. An investor has already signed up for the development of the first labour village, with the initial plan to accommodate around 2,500 labourers. This initiative demonstrates the city’s commitment to supporting the needs of businesses and providing comprehensive solutions for their operational requirements.

Khazaen Economic City offers a wide range of investment opportunities across various sectors. With its well-developed infrastructure and sector-specific zones, the city provides a conducive environment for businesses to thrive. Whether in industrial and logistics, technology, food processing, pharmaceuticals, automotive, or other sectors, investors can find the necessary infrastructure and support to establish and expand their ventures in Khazaen Economic City.

It’s important to note that the Khazaen Dry Port operates on a Public-Private Partnership (PPP) model, with ownership lying in the private sector. This approach leverages the expertise and resources of the private sector to develop and operate the dry port, promoting efficiency and effectiveness in cargo handling and distribution. Khazaen Dry Port is the first integrated international dry port in the Sultanate. It will link various seaports, commercial, and industrial areas. It is considered a main pillar in the city due to its importance to enhance the integration of logistics solutions for investors.

The International Logistic Park, supported by the Khazaen Dry Port, stands as a central and vital component of the logistics sector within Khazaen Economic City. This park serves as a key hub for the efficient movement and management of goods, providing comprehensive logistics services to businesses operating within the city. It facilitates seamless connectivity between different transportation modes, enabling the smooth flow of goods both domestically and internationally.

The Industrial Centers within Khazaen Economic City play a crucial role in attracting and accommodating various industries. These centres provide specialised infrastructure and facilities tailored to the specific needs of different industrial sectors, fostering a favourable environment for manufacturing, production, and related activities.

To support the trucking industry and ensure the smooth operations of goods transportation, a Truck Rest Area is established within Khazaen Economic City. This area offers designated spaces for truck parking, rest facilities for drivers, and associated services, ensuring the efficiency and convenience of trucking operations.

The Khazaen Fruits and Vegetables Central Market is currently under construction and is scheduled to open in the first quarter of 2024. This market serves as an integral part of the Food City within Khazaen Economic City. It aims to centralise and relocate all wholesale activities and central cold stores from the existing market. By consolidating these activities in a modern and purpose-built facility, the market contributes to the objectives of the national strategy for food security. The project involves an agreement signed with the Muscat Municipality in May 2021, outlining the transfer of wholesale activities and central cold stores to the new venue.

Each of these key anchor projects plays a vital role in fostering economic growth, supporting specific industries, and meeting the needs of businesses and the community.


Khazaen Economic City offers an ecosystem that streamlines the investment journey, providing integrated components to facilitate the successful establishment and expansion of projects. To further enhance the investment process, Khazaen has planned the establishment of a one-stop shop within the city. This dedicated facility aims to attract investors of all categories by simplifying procedures and expediting services, enabling faster approvals, permits, and licences for businesses to commence operations promptly.

In addition to the streamlined processes, Khazaen Economic City provides attractive incentives to entice investors. These incentives include grace periods, exemption from technical and administrative fees, 43-year leaseholds, tailored lease and ownership solutions, and competitive land costs. Such incentives offer flexibility to investors in developing and managing their projects, enabling them to optimise their operations and maximise their returns.

By attracting investments and fostering economic growth, Khazaen plays a significant role in diversifying the national economy and contributing to the country’s GDP. Upon completion, it is expected that Khazaen will contribute around 2-3 per cent to Oman’s GDP, reflecting its substantial impact on the overall economy.

Furthermore, Khazaen Economic City aligns with government initiatives and actively supports the In-Country Value (ICV) program. By promoting the participation of the private sector and building national capabilities, Khazaen creates new commercial opportunities for small and medium enterprises (SMEs) and generates employment opportunities for the local population. This commitment to inclusivity and socio-economic development contributes to the overall growth and prosperity of Oman.

In terms of international trade, Khazaen benefits from free trade agreements. These agreements, such as the Gulf Cooperation Council Free Trade Agreement (GAFTA), the free trade agreement with Singapore, and the United States, enhance the city’s global connectivity and provide access to broader markets. This favourable trade environment further strengthens Khazaen’s appeal as an investment destination and opens doors to increased trade opportunities for businesses operating within the city.

In summary, Khazaen Economic City offers an investor-friendly ecosystem with streamlined processes, incentives, and a forthcoming one-stop shop. It contributes to the diversification of Oman’s economy, and anticipated GDP growth, and supports government initiatives, including ICV. Additionally, the city’s strategic location and free trade agreements create opportunities for enhanced international trade and economic cooperation.

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