Oman Investment Authority officially launches Oman Future Fund

OIA officially launches Oman Future Fund

Muscat: The Oman Investment Authority (OIA) officially launched the Oman Future Fund today with a capital of RO 2 billion, over five years at RO 400 million annually, and distributed to 90 percent for new or existing direct investment projects that are commercially and economically feasible and meet Results of the feasibility study, and 10 percent for small and medium enterprises and startups.

The Fund provides its services to private sector institutions, business owners, small and medium-sized companies, in addition to foreign investors, and includes eight targeted sectors: tourism, industry and production, green energy, information and communications technology, ports and logistics services, mining, fisheries, and agriculture.

Abdul Salam bin Mohammed Al Morshedi, Chairman of the Oman Investment Authority, said that the establishment of the Oman Future Fund aims to advance the targeted economic sectors, as the Fund is considered a major possibility for stimulating the growth of the national economy, and a reliable partner for local and international investors wishing to expand the scope of their projects in the Omani economy or enter the Omani market.

He added that the Oman Future Fund will contribute to integration with the private sector, support small and medium enterprises, in addition to stimulating the venture investment system in the Sultanate of Oman, explaining that the fund will serve as a third portfolio for the agency in addition to the two current investment portfolios (National Development) and (Generations).

He indicated that the agency will use its investment experience to manage the fund, which confirms the Omani competencies it possesses and has proven its ability to achieve successes in managing, investing and developing funds and achieving good returns from them. The Oman Investment Authority added in a statement to reporters that the Oman Future Fund will support all initiatives that aim to establish projects in the Sultanate of Oman, whether these projects are carried out by government companies, companies from the private sector, or by foreign private sector initiatives.

He noted that the fund will have the ability and flexibility to take several forms of financing, including contributing as a partner in the capital, and also being a lender to these projects, noting that there are no funds or portfolios currently that can finance more than 5 million Omani riyals. While the Oman Future Fund will be able to finance projects up to 100 million Omani riyals for each project separately, with a maximum of 40 percent of the capital in the partnership, as the private sector will be the one leading these projects. His Excellency the Chairman of the Oman Investment Authority stressed the need for the projects to be financed by the Oman Future Fund to have economic feasibility studies from neutral parties, and progress will be via a digital platform, which will save effort and time for project owners.

He pointed out that the foreign investor is always looking for several incentives, including the presence of local financing bodies, adding that priority in financing will be for the projects that are most feasible and most valuable to the Sultanate of Oman in terms of providing jobs, using Omani raw materials, contributing to the Omani economy, the size of the local product, and thus the best projects. It is the projects that win funding, not necessarily the projects owned by the Oman Investment Authority.

Halima bint Rashid Al Zaria, Chairwoman of the Small and Medium Enterprises Development Authority, explained that allocating 10 percent of the Oman Future Fund to small and medium enterprises will enhance access to non-traditional financing for emerging companies based on innovation and technology, as well as small and medium enterprises.

The fund will be subject to the governance in force in the agency, which includes the best international practices and ensures efficiency and flexibility in order to achieve the financial and economic objectives desired by establishing the fund, to complement the system of financing and investment coverage currently provided by the government through a number of institutions such as the Oman Development Bank and the Small Enterprises Portfolio. SME, Rakaza Fund, and Oman Technology Fund; With flexibility in determining the type of contributions to the selected investments; Whether through direct financing at market cost, or through capital partnership with the private sector, so that financing is distributed among these sectors in a balanced manner and not focusing on a specific sector. In compliance with the principles and rules of governance and transparency; The fund will be subject to the quality standards adhered to by the Oman Investment Authority, which qualified the agency to rank second globally in the Governance and Sustainability Performance Development Index between 2022 and 2023.

The Fund will have two committees: The first (investment committee) includes five members from the agency, the Ministry of Finance, and independent bodies, and is responsible for approving new investments, subsequent investments, and exits, and an (advisory committee) that supervises the follow-up of small and medium enterprises and emerging companies. In order to achieve the national objectives of establishing the fund, the Ministry of Finance will be a strategic partner to the agency in managing direct local projects, and the Small and Medium Enterprises Development Authority will be a member of the advisory committee that provides views and guidance to the fund’s investment committee, and the Omani National Investment Development Company “Tanmia” and the Iqqa Group will work, Omantel and Cypher Capital are responsible for managing investments in the categories of small and medium enterprises and emerging companies. The aim is to invest in modern technologies and automate processes in a way that contributes to making it easier for beneficiaries of all categories. Applications for the fund’s services are made through the electronic platform (WWW.Futurefund.OM), which is designed to provide access to information and requirements related to financing applications. The investor is required to register an account on the platform and answer a set of questions to determine the suitability of the investment opportunity and facilitate determining the type of financing. If the financing conditions are met, the applicant will have to fill out the investment opportunities form to complete the application process, which will then be referred to the relevant team for consideration.

The process of reviewing and analyzing the application may take a period of up to three months after submitting it, during which the applicant will be notified of the status of his application, noting that The required documents depend on the nature and stage of the project, and in general, the required documents will include a feasibility study that includes, but is not limited to, the actual and expected technical and financial information for the project, the sponsor’s previous financial reports, and personal proof documents.

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