In early 1998, it was announced that His Majesty had initiated the Fund for Development of Youth Projects . This fund has been created with the support of the private sector to provide capital for projects set up by young Omanis and to supply them with technical assistance and managerial support, which will enable them to obtain grants and loans from other sources in order to set up their own businesses. The scheme is aimed at turning young Omanis with   business flair into entrepreneurs and to create a layer of small companies to complement the larger, well-established companies in the private sector. In his 1998 National Day address to the nation, His Majesty spoke about the concept of this Fund. 'The youth of Oman who have the spirit of initiative and the desire to embark upon their own businesses, should make use of the fund to finance their projects, having assured themselves that their plans are feasible. They should avail themselves not only of the financial assistance offered, but also of the voice of experience extended to them in marketing and business administration. The main aim of this Fund is to encourage the youth of Oman to establish and own small and medium projects that will provide them, and other citizens, with career opportunities, thus contributing to the creation of a strong industrial sector of small businesses which have become an important factor in the growth of the global economy.’

His Majesty started the Fund with a contribution of RO1 million and since then, considerable contributions have been received from companies and individuals.

The Fund for Development of Youth Projects (SAOG), which was established by Royal Decree in November 1998 as an Omani joint stock company, was formally launched in April 1999. The decree exempts the fund from company income tax for a period of 10 years, which may be extended for a similar period. It also gives exemption from corporate tax and tax on profits for five years to the fund's industrial and commercial projects. In early 1999, a number of proposals were submitted to the Fund management to examine their financial viability. During the inauguration of the fund, the first five of these projects were approved.