Strategic Direction
A Diversified and Sustainable Economy Based on Technology, Knowledge and Innovation
Strategic Direction
A Diversified and Sustainable Economy Based on Technology, Knowledge and Innovation, Operating within Integrated Frameworks, Ensuring Competitiveness, Embracing Industrial Revolutions and Achieving Fiscal Sustainability.
This is Vision 2040’s signature priority — the structural transformation from oil dependency to a genuinely diversified economy. The targets are stark, the challenge is immense, and the progress, while real, remains well short of the trajectory required.
Performance Indicators
| Indicator | Baseline | 2030 Target | 2040 Target |
|---|---|---|---|
| Non-Oil GDP Share | 61% (2017) | 83.9% | 91.6% |
| Oil Share of GDP | 39% (2017) | 16.1% | 8.4% |
| Economic Complexity Index | -0.004 / Rank 62 | >1.186 / Top 20 | >1.577 / Top 10 |
| Networked Readiness Index | 4.31 / Rank 52 | >5.4 / Top 20 | >5.6 / Top 20 |
| Current Account Balance (% GDP) | -14.8% (2017) | -7% deficit | -1.5% deficit |
| Total Public Expenditure (% GDP) | 45.1% (2017) | 34% | 25% |
| Non-Oil Revenue (% GDP) | 9.5% (2017) | 15% | 18% |
| Gross Debt (% GDP) | 44% (2017) | Does not exceed 60% | — |
Non-Oil GDP: The Core Transformation
The non-oil GDP share is the most fundamental measure of Vision 2040’s diversification ambition. Rising from 61% to 91.6% requires not just expanding non-oil sectors but actively managing the relative decline of the oil and gas sector’s GDP contribution.
Current estimate: Approximately 70.5% (2023) — up from 61%, but the remaining 21 percentage points require transformational sectoral development over 16 years.
Key Diversification Sectors
Tourism: Revenue of approximately OMR 3.2 billion (2023) against a 2040 target of OMR 12 billion. Strong trajectory but significant investment required in hotel stock, aviation connectivity, and experience infrastructure.
Logistics: Oman’s geographic position — midway between Europe and Asia, adjacent to the Strait of Hormuz, with deep-water ports at Sohar, Salalah, and Duqm — provides genuine competitive advantages. The IMEC (India-Middle East-Europe Corridor) initiative could be transformative for Oman’s logistics position. ASYAD Group is the consolidating vehicle for logistics sector development.
Green Hydrogen: The $30+ billion pipeline of green hydrogen and ammonia projects (ACME, Hyport Duqm, and additional projects) represents Oman’s most ambitious new industry creation effort. Two new agreements were signed in 2024/2025.
Manufacturing: Sohar Industrial Port and Duqm SEZ are anchoring manufacturing development, with Jindal Shadeed (steel), Duqm Refinery (DUQM-Aramco JV, 230,000 bpd), and OQ’s chemicals complex.
Digital Economy: Oman’s first satellite registration with the UN (2024), establishment of the Fourth Industrial Revolution Centre (22nd globally), and digital government transformation are building the foundation for a digital economy sector.
Economic Complexity: The Real Test
The Economic Complexity Index (ECI) is arguably the most honest measure of structural diversification — it measures the diversity and sophistication of a country’s export basket, reflecting the productive knowledge embedded in the economy.
Oman’s ECI baseline of -0.004 (rank 62) reflects an economy still substantially defined by commodity exports. The 2040 target of >1.577 (top 10) would place Oman alongside Germany, Japan, and South Korea — economies defined by complex manufactured goods and sophisticated services.
This is an extremely ambitious target that would require not just investment in new sectors but the development of deep industrial ecosystems with domestic supply chains, specialised skills, and technological capabilities. The trajectory from -0.004 to 1.577 in 23 years is achievable only with extraordinary policy consistency and private sector development.
Current estimate: Approximately 0.25 (2022) — progress, but well below the trajectory needed.
Key Institutions
Ministry of Economy, Ministry of Commerce Industry and Investment Promotion, OPAZ, OIA, Madayn, SEZAD, ASYAD, OQ Group, OMRAN.