Over-reliance on oil production has left the countries of the Arabian Peninsula vulnerable to declines in the price of oil. A swift decline last year led to stagnation in almost all Gulf economies. The notable exception: Oman. Since 1970, the year of ‘renaissance’ when Sultan Qaboos bin Said took power, the country has undertaken to modernise and diversify its economy. Oman has since progressed in leaps and bounds, especially in more recent times: its non-oil exports reached US$8 billion in 2015, up from US$680 million in 2002, with locally-produced goods today being exported to 140 countries worldwide.

This said, oil and gas continues to play a pivotal role in the Omani economy. In 2014, the Sultanate’s hydrocarbon sector accounted for 84% of government revenue and 47% of GDP.

Oman is also the largest oil producer in the Middle East not to be affiliated with OPEC, and is thus not subject to any stifling of its production and exports – this has made it well-placed to capitalise on its resources.

‘Well-placed’ is a description which suits Oman. From its origins as a sea-trading hub, it has always reaped the advantages of its position. The country today leverages its good relations with its neighbours and its moderate, independent foreign policy to enhance its relationships with larger economies. Relations with the United Kingdom are friendly, and can only strengthen as the UK looks further afield for allies in years to come. The Sultanate now looks to building further ties in Europe.

One of the most exciting areas for growth is in the tourism sector. Oman was recently named the fourth safest country in the world for visitors, and could become one of very few countries in the region to benefit from recent years’ instability. A perceived lack of security in historically more attractive destinations like Egypt and Tunisia, for example, could end up leading tourists to less traditional places like Oman. Its golden beaches, desert interior, and fascinating cultural landmarks provide it with the potential to become a prominent destination in the region.

The Oman Tourism Development Company (Omran) has lofty ambitions for Oman’s capacity for growth in tourism. Their aim is to reach 10 million tourists within ten years, maintaining a 10% annual growth rate. This is far beyond the expectations of the Ministry of Tourism, but their mandate is from the Sultan himself and they are keen to strive for the best for their country.

So confident are the highest echelons of power in Oman of a boom that it has been decided to develop three additional regional airports – Sohar, Duqm, and Ras Al Hadd – to accommodate the expected growth. The expansion of Sohar, once completed, is expected to make it the next big international airport in the region.

Omran is not without grounds for confidence. A number of Integrated Tourism Complex (ITC) projects are currently in development which testify to the industry’s growth: Madinat Al Irfan is one of their major projects, and they are in the process of meeting with investors – 70 investors have been met with in the last four months. The project is an ambitious move to establish a new urban centre within Muscat, creating, according to Omran, “a magnet for business, a centre for tourism, and a great place to live and work.” Eng. Saif Al Hinai, acting-CEO of Omran, explains the origins of the idea: “The idea stems from the fact that we really need to develop our urban lifestyle. We think there’s enough room for improvement in our urban planning and with the support of government and key stakeholders, we are embracing international standards to develop this project.”

Another of the largest projects that Omran are involved in is The Sultan Qaboos Waterfront. The US$1.3 billion plan, instigated by the Sultan himself, is to build a tourism port to act as a tourism hub for the city of Muscat. It is scheduled for completion in 2020.

These projects are inkeeping with Tanfeedh, the country’s programme for enhancing economic diversification. The initiative, which is the latest in a series of five-year development plans, targets the sectors of manufacturing, tourism, transport and logistics, mining, and fisheries, and is intended to boost their contribution to the Sultanate’s GDP. Tanfeedh will see the government promote self-funded projects to spur economic growth, with greater efforts made to ease the process of doing business and making private investments. More public-private partnerships, such as we have seen through Omran with Madinat Al Irfan, will surely also be welcomed as the country looks to further develop its infrastructure, particularly in transport and logistics.

Hemant Murkoth, CEO of Business Gateway International, sees other opportunities for investment and development:

“ICT infrastructure in Oman still has a long way to go. We have not reached that particular level, but I see a lot of perspective and opportunities for the next three to four years.” In the manufacturing of IT, Murkoth tells us, and in Business Process Outsourcing (BPO) Oman “has a lot to catch up on.”

Investing in ICT, as Mr. Murkoth suggests, will be essential to the Sultanate’s development, and will be done as an extension to the infrastructure investment it has so readily given. There will surely be room for private-public partnerships of the like being seen in other industries today. Murkoth emphasises, as do so many others, the need to diversify away from oil and gas, but also praises the government’s approach:

“Now there is a reality that diversifications are needed. But I am pleasantly surprised that Oman has not pressed the panic button yet, although other countries in the GCC region have. They are keeping a cool head.”

An innovator in the story of Omani development has been Hayut International, which began as a telecommunications company and has since evolved into new fields varying from military equipment to renewable energy. Raad Al Farsi of Hayut explains the company’s modus operandi as follows: “We just look at what is outdated, what needs to be changed, and offer the best solution around that. Sometimes we have to tell clients why they need a certain solution.”

Mr. Farsi is keen to discuss Hayut’s newest innovations; he tells us of the Smart Flower, which is a solar panel base, and of a headset with camera, microphone, and earpiece to use in the field to consult with specialists. When asked about future clients or partners he would like to attract, his message is predominantly green:

“Sewage disposal is a personal thing that I want to focus on. Renewable energy and recycling is important to me. If you think about the waste that goes into one spot, it forms a chemical disaster. I believe it’s important to treat this. People burn trash, or bury it, or send it in barges to be thrown to the sea. I want to provide a solution to this.”

Asked why investors should come to Oman, Farsi is to the point: “We welcome new ideas with open arms.”

It is this attitude which has characterised the Sultanate in recent decades as it has attempted to forge a path not entirely defined by oil. Oman has led the region in attempts to diversify, and now stands as one of its most promising economies. Ready to invest and welcoming to investment, the sultanate is ticking all the boxes that make economic development inevitable.