Oman has ambitious plans for developing tourism as a priority sector for diversifying the economy away from hydrocarbon resources. The National Strategy for Tourism 2040 aims to make the Sultanate as one of the most important tourism destinations with a robust six per cent annual growth in tourism revenue, besides doubling the number of tourists to five million visitors by 2040, from merely 2.6 million visitors now.
As a key enabler of job creation and diversification, Oman government has been developing the sector by building infrastructure, encouraging private investments, and conducting extensive international promotion campaigns. The Sultanate, like other GCC states, is expanding capacity at the airports and developing infrastructure to complement the government push for boosting visitor traffic, thus providing a major incentive for increasing hotel capacity.
The strategy also aims to increase the share of investment by the private sector in tourism projects to 88 per cent, especially in building hotel rooms. The number of hotel rooms in the country will be raised to 20,000 by 2020, from the existing 16,000 level. Massive infrastructure developments and hotel projects are underway to meet the growing demand of tourist inflow expected in the coming years. Driven by the bright prospects of the tourism industry, several international hotel chains as well as domestic players have laid down robust hotel and serviced apartment development plans, which are under different stages of planning and development. Apart from a massive expansion of hotel rooms, the development of Muscat International Airport, the partial opening of an International Exhibition and Convention Centre and route expansion programmes of Oman Air and the newly-launched budget carrier are all expected to aid tourism growth in the country.
The tourism sector has got a shot in the arm with the opening of a state-of-the-art airport in Muscat in 2017, while new routes of Oman Air and budget carrier Salam Air will help to attract tourists from within the region and other international destinations. The new state-of-the-art terminal at the Muscat airport has a capacity to handle 12 million passengers per annum, which can be scaled up to 24 million, 36 million and 48 million in different phases if needed. The Muscat airport has two parallel runways, 96 check-in counters, 29 passenger boarding bridges, 30 aircraft remote stands and a baggage processing capacity of 5,500 bags per hour. Of late, Oman Air has added three destinations – Manchester, Nairobi, Guangzhou – to its routes from Muscat, while Salam Air started its flights to Saudi Arabia and Pakistan.
With the opening of the international convention centre in 2017, the Oman government is looking to become a major regional centre for meeting, incentives, conference and exhibition (MICE) events. An increase in events hosted at the convention centre is likely to attract more business travellers, thus benefiting the hospitality sector. Apart from natural beauty, Oman offers a range of cultural and sports activities like scuba diving, boat trips, dolphin watching, Royal Opera House, ancient forts and the national museum. The upcoming Duqm tourist complex featuring a mall, hotels, entertainment centre, and water theme park is likely to have a large impact on tourism.
Integrated tourism complexes
After developing major integrated tourism complexes (ITCs) like Al Mouj and Muscat Hills, another ITC is taking shape in Quriyyat, which is going to be the first freehold ITC project in the last seven years. The new tourism venture is part of the country’s strategy to strengthen facilities for tourists.
Quriyyat Tourism Complex, which will be developed in three different phases over a 15 year period by the private sector, will have three hotels, a nine-hole golf course, commercial and residential complexes, along with a marina. The first phase, which will have an investment of RO100 million, is expected to be ready by 2021. The entire tourism complex will cover a total area of 1,282,300 square metres and the total investment in three phases is estimated at RO385 million. The authorities are taking steps to allot land for tourism projects on a priority basis. For instance, the Ministry of Housing has allotted 33 plots spread over millions of square metres across the Sultanate last year for setting up of tourism-related projects.
Among various governorates, Muscat governorate has received the largest number of tourism projects. Among the projects to come up in Muscat include a restaurant and a coffee shop on 150 square metres (sqms) in Shatti al Qurm, a restaurant complex in Bausher on 1,421sqm plot, a hotel and a commercial complex in Mabela over 179,590sqms, a hotel in Amerat over 2,614 sqms, a hotel and a resort over 15,000 sqms in Al Khoudh and two resorts spread over 150,000sqms and 47,499 sqms land in Seeb. Five tourism sites have been allocated in Dhofar, including hotel apartments in an industrial area n Salalah spread over 5,002 sqms, tourism camp in Thumrait over 20,000 sqms, a resort in Mirbat over 10,000 sqms, a resort in Taqah over 30,000 sqms, in addition to a traditional restaurant project in Salalah over 5,835 sqms. In Rustaq, a cultural hostel in Al Hoqain over 9,246 sqms area and a hotel in Al Alaya over 10,000 sqms have also been allotted land. Similarly, in Nizwa, two plots were allotted for two hotels to come up in Redat al Busaid area over an area of 10,000 sqms and another one in Al Turath area over 3,1461 sqms land. Also, a plot has been allocated in Jebel Shams to set up a resort over 78,562 sqms. In North Sharqiyah, four projects got land approval and include a tourism complex in Al Fulaij in Ibra over 10,000 sqms, a resort in Al Wasil in Bidiyah over 30,000 sqms, a hotel in Al Suwaireej area in Mudhaibi over 4,123 sqms and a resort in Al Qabil over 10,000 sqms. The ministry has also approved seven projects in South Sharqiyah, the most important of which is the project to develop Ras al Hadd in Sur over 1,971,823 sqms area to set up hotels, villas, shopping areas, wild life centre, and a cultural centre.
A drop in oil prices in the last couple of years is posing challenges for the Sultanate’s tourism sector. Depreciation of currencies such as the pound, euro and rouble against the US dollar also eased tourism activity in the country. As a result, Oman is looking for growth in its mid-market travel sector as challenging global and regional economic conditions weigh on people’s willingness to spend.