Gap Alert: Real GDP Growth
Severity: RED
Real GDP growth has decelerated to 1.1 percent, well below the 5 percent sustained target.
Gap Analysis
The gap between the current 1.1 percent growth rate and the 5 percent target is the most consequential in the Vision 2040 framework. GDP growth is the denominator that determines whether most other targets are achievable. The deceleration reflects OPEC+ production restraints, a slow post-pandemic recovery in non-oil sectors, and insufficient private investment. Without a step-change in growth drivers, the entire Vision 2040 edifice is at risk. This is not a cyclical shortfall but a structural growth deficit.
What Needs to Change
A comprehensive growth acceleration strategy is needed covering four pillars: (1) unlock private investment through regulatory reform and PPPs; (2) ramp up non-oil exports in logistics, manufacturing, and tourism; (3) dramatically increase labour productivity through technology and capital deepening; and (4) expand the productive workforce through targeted Omanisation and skilled immigration.
Risk Assessment
Red severity. This is a systemic risk to Vision 2040. At 1.1 percent growth, cumulative GDP by 2040 would fall roughly 40 percent below the scenario needed for target achievement across all pillars. Every year of underperformance compounds the gap exponentially.
Recommended Interventions
Urgent actions: fast-track Final Investment Decisions on green-hydrogen megaprojects; accelerate Duqm SEZ industrial leasing; reform the public-investment framework to prioritise high-multiplier projects; expand trade-finance facilities for non-oil exporters; and convene a national growth council with quarterly reporting to the Sultan.
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.