September 29, 2008
Oman to Invest USD 5 Billion in Domestic Steel Industry in 2008
Oman to invest USD 5 billion in domestic steel industry in 2008
Danube to leverage booming market by investing AED 50 million in a new steel facility in OmanThe Sultanate of Oman is aiming to become one of the Gulf region's top iron and steel producer, with plans to invest USD 5 billion to boost productivity and construct new facilities as part of the government's efforts to broaden the base of its economy for the coming years. With a clear directive to further strengthen its position in the country's fast growing construction market, Danube Building Materials FZCO, the leading player in the construction, interior decoration and shop fitting industry, has announced that it will be channelling AED 50 million to develop a new steel facility in Mabella, Oman which will further strengthen its position in the Sultanate.
Spanning approximately 51,000 sq.ft. in the Mabella area, the facility will function as the logistics hub for Danube's operations in Oman and will facilitate the storage of all stock including deformed bars and other structured steel like angles, channels, and plates. Upon completion, the facility will be ideal for all Omani construction companies to get their required supplies at highly competitive prices on account of the economies of scale generated through bulk purchasing done in Dubai. Furthermore, the manufacturer has also revealed that it will have large-scale imports of steel products from Turkey, China, Taiwan, Korea, South Africa, Ukraine, Russia, India, Saudi Arabia and Iran, which will then be processed to address varying customer requirements.
"The unprecedented growth of the real estate market in Oman has been fuelling intense activity in the construction scene, with the government focusing high interest into further advancing its local steel trade," said Rizwan Sajan, Chairman, Danube Building Materials. "We consider Oman as a key market for our high quality building materials, and with more construction and real estate projects emerging within the Sultanate, this is truly the perfect time to invest significantly in expanding our operations there. This new facility will substantially increase our steel products output, thereby ensuring a steady supply of top-grade steel-based construction materials not only for the country but for the rest of our regional markets as well."
As a relative newcomer to the steel sector, Oman has witnessed significant growth in its local steel industry in the last few years as a result of strategic utilisation of its energy resources, solid infrastructure and proximity to export markets. Industry analysts are optimistic of Oman's potential to become a major steel producer in the region, with the government taking substantial investments in developing its steel production capacity primarily to supply the burgeoning local consumption, which is expected to hit 1.1 million tons by 2010. Given the favourable market landscape in the Sultanate, Danube is expecting its latest expansion effort to generate high revenues, while fostering strategic partnerships with more Oman-based partners.
"This new endeavour gives us an excellent opportunity to leverage the booming Oman steel market as well as the Sultanate's excellent relations with potential importing countries. Our expansion to Oman is a testament to our growing business, which has gone well beyond our UAE operations to reach the most booming markets in the region today. Our regional growth strategy to exploit high market demand for our products is driving our expectations for the achievement of our revenue goals for 2008, and we are looking forward to supply our steel products to future projects in the Sultanate," concluded Sajan.
In addition to its Oman-based expansion, Danube has recently announced its plans to invest AED 200 million in the steel industry in UAE for 2008. Maintaining a high level of quality across all its products, the company is currently in the process of initial market testing to ensure the smooth delivery of its products to customers. 2008 Al Bawaba (www.albawaba.com)
Originally published by By Al-Bawaba Reporters.
(c) 2008 Al Bawaba. Provided by ProQuest LLC. All rights Reserved.