Gap Alert: Tourism Revenue

Gap Alert: Tourism Revenue

Severity: AMBER

Tourism contributes approximately 2.8 percent of GDP, below the Vision 2040 target of 5 percent by 2030.

Gap Analysis

Oman’s tourism sector has recovered from the pandemic-era collapse and receipts have doubled since 2019. However, the country still attracts a fraction of the tourist volumes seen by the UAE or Saudi Arabia. Constraints include limited international airline connectivity, insufficient hotel inventory outside Muscat, and a mismatch between the high-end eco-tourism brand and the mass-market infrastructure needed for volume growth.

What Needs to Change

Pursue a dual-track strategy: first, develop premium nature-based and cultural tourism products at Jebel Akhdar, Wahiba Sands, and the frankincense trail with high spend-per-visitor; and second, scale MICE and transit tourism through Muscat Airport expansion and competitive airline partnerships.

Risk Assessment

Amber severity. Tourism is a proven diversification lever with strong employment multipliers. The gap is large but closable given Oman’s unique cultural and natural assets. The constraint is investment and marketing execution rather than inherent attractiveness.

Recommended Interventions

Priority interventions: fast-track hotel licensing outside Muscat; negotiate additional air-service agreements with high-potential source markets including India, China, and Western Europe; establish a unified destination-marketing authority; invest in tourism infrastructure such as roads, signage, and visitor centres in secondary destinations; and create a tourism-satellite account for accurate GDP measurement.

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.