Gap Alert: Economic Freedom
Severity: AMBER
Oman’s Economic Freedom score has remained relatively flat in the moderately free range, lagging behind regional leaders and the Vision 2040 aspiration.
Gap Analysis
Economic freedom in Oman is constrained by government involvement in the economy through SOEs, regulated prices, and labour-market restrictions. While fiscal health has improved, property-rights enforcement, judicial independence in commercial matters, and investment freedom remain below top-quartile benchmarks. The dominance of the Oman Investment Authority portfolio across multiple sectors creates an uneven playing field for private competitors.
What Needs to Change
Accelerate the SOE reform and privatisation agenda. Strengthen commercial-court capacity and enforcement. Liberalise remaining restricted sectors. Reduce the government’s direct role in the economy from provider to regulator, creating space for private enterprise to flourish.
Risk Assessment
Amber severity. Economic freedom is a composite measure that responds to broad institutional reform. Improvements are achievable but require political commitment to reducing the state’s economic footprint and levelling the playing field between SOEs and private firms.
Recommended Interventions
Key interventions: publish a five-year privatisation pipeline with committed timelines; establish an independent competition authority with enforcement powers; reform the insolvency framework to facilitate market exit; reduce trade-weighted average tariffs; and strengthen intellectual-property protection to encourage innovation-driven investment.
This gap alert is issued by the Oman Vision 2040 Research Unit and is updated quarterly. Severity levels: GREEN (on/ahead of track), AMBER (gap widening but recoverable), RED (structural gap requiring urgent intervention). Data sources include NCSI, World Bank WGI, IMF, and relevant international indices.