Economic and Political Overview

flag Oman Oman: Economic and Political Overview

In this page: Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

 

Economic Indicators

The Sultanate of Oman has experienced remarkable economic growth since 2004, primarily driven by the exploitation of its oil reserves. Despite a contraction due to the pandemic, Oman's economic recovery continued in 2022 (+4.3% of GDP) and 2023 (+1.2%), supported by favourable hydrocarbon revenues. According to official governmental figures, Oman’s GDP at constant prices rose 1.6% year-on-year in 2024 to OMR 37.7 billion (USD 98.1 billion), while GDP at current prices dropped 3.0% to OMR 40.7 billion, driven by weaker oil activity. Non-oil sectors grew 3.7%, led by manufacturing (+8.5%), wholesale and retail trade (+7.1%), and financial services (+3.5%). Oil-related activities declined 3.6% in real terms due to lower crude output and prices. According to the IMF, real GDP growth is expected to rebound to 2.6% in 2025, driven by recovering hydrocarbon output (+1.0%) as OPEC+ cuts ease, and stronger non-hydrocarbon growth (+3.4%) supported by construction, manufacturing, and services. Over the medium term, non-hydrocarbon activity is set to rise to 4.2% as major private investments are rolled out.

Oman has made significant progress in strengthening its fiscal and external positions while advancing the implementation of Oman Vision 2040. The Medium-Term Fiscal Plan (MTFP), initiated in 2020, has played a crucial role in achieving fiscal sustainability by diversifying revenue streams, controlling expenditures, and prudently managing hydrocarbon windfall savings. The overall budget recorded a surplus of OMR 520 million, compared to OMR 830 million in the same period of 2023. Government revenues rose 4% to OMR 10.2 billion by October 2024, driven by oil revenues (+11%), goods and services taxes (+18%), and stable non-oil receipts. Public spending increased 8% to OMR 9.68 billion, including higher allocations for development projects and sectoral subsidies. The 2025 budget aims to maintain fiscal discipline, further reducing the non-hydrocarbon primary deficit, while keeping spending on social safety nets largely unchanged compared to 2024. Government net financial assets are projected to turn positive in 2025 for the first time since 2017, rising to 6.8% of GDP by 2029, driven by asset accumulation and modest deleveraging as debt approaches 30% of GDP. Oman is assessed to be at low risk of sovereign debt stress, supported by strong financial buffers that mitigate liquidity and solvency risks. Meanwhile, inflation is estimated to have remained low at 0.8% in 2024, gradually converging to 2% over the medium term, according to the IMF.

The National Centre for Statistics and Information (NCSI) reported a continued decline in Oman’s unemployment rate, which fell to 3.6% by November 2024. The rate is much higher for women than for men (at 10.3% and 1.9%, respectively) and is not expected to see significant changes in 2025. In recent years, the government introduced initiatives to address the high share of expatriate workers, including bans on foreign worker visas, to promote the employment of Omani citizens. In 2024, the number of foreign workers declined by around 1% compared to 2023, while Omani workers increased by approximately 0.5%. Additionally, the authorities have implemented a new labour law focused on modernizing regulations and enhancing working conditions and flexibility in the labour market. Several initiatives have been launched to bolster the employment of nationals in the private sector, including the Wage Protection System and providing wage support to private sector employers for hiring nationals.

 
Main Indicators 2023 (E)2024 (E)2025 (E)2026 (E)2027 (E)
GDP (billions USD) 108.81109.99111.31116.19121.29
GDP (Constant Prices, Annual % Change) 1.31.03.14.44.0
GDP per Capita (USD) 21,06320,63120,23020,46220,699
General Government Gross Debt (in % of GDP) 36.534.133.631.730.4
Inflation Rate (%) 0.91.31.52.02.0
Current Account (billions USD) 2.642.531.601.802.25
Current Account (in % of GDP) 2.42.31.41.51.9

Source: IMF – World Economic Outlook Database , Latest available data

Note: (e) Estimated Data

Main Sectors of Industry

Oman has a workforce of 2.69 million out of its 5 million population, of whom about 43% are expatriates. The share of expatriate workers has declined in recent years as Oman implemented a visa ban to boost the hiring of Omani citizens. Prior to the discovery of oil fields, Oman was virtually a subsistence economy that was entirely based on agriculture and fisheries. Nowadays, the latter contributes only marginally to GDP (2.3%) and employs 6.1% of the workforce (World Bank, latest data available). Agricultural production is mainly composed of dates, limes, and bananas, and owing to the lack of fertile land the country needs to import from international markets. In the agricultural season of 2022/2023, wheat production in the Sultanate of Oman saw a remarkable surge of 229%, totalling 7,119 tonnes. Additionally, the number of farmers increased by 22%, and the area dedicated to wheat cultivation expanded by 160% year-on-year to 6,359 acres, according to data from the Ministry of Agriculture. Moreover, the government has recently implemented various initiatives to support the sector, including the provision of fortified wheat seeds and modern harvesting equipment.

The industrial sector accounts for 54.3% of GDP and employs 40.2% of the workforce (World Bank). Its share has increased considerably in the last two decades (employment in industries was as low as 11% in 2000) as Oman increasingly uses enhanced oil recovery techniques and supports mining and manufacturing. The manufacturing sector alone is estimated to contribute to 9% of GDP (World Bank). However, the country is heavily dependent on oil and gas resources, which generate between 70% and 85% of government revenue on average, depending on fluctuations in commodity prices. According to the National Centre for Statistics and Information, Oman’s manufacturing sector grew over 10% in H1 2024 year-on-year, with output at fixed prices reaching OMR 1.868 billion, driven largely by oil refining, petrochemicals, and basic chemicals. The Public Authority for Special Economic Zones and Free Zones (OPAZ) has launched new industrial cities to expand industrial establishments, attract local investment, and boost the sector’s GDP contribution. By the end of 2024, industrial licences in special economic and free zones rose to 183, with industrial cities accounting for 125, or 68% of the total.

The services sector accounts for 46.4% of GDP and 53.7% of the workforce (down from 82.4% in 2000). Oil-related activities comprise a significant share of the services sector; however, logistics (maritime transport in particular) and financial activities are growing steadily. Tourism is one of the sectors being developed in order for the Sultanate to build a sustainable non-oil future, and the number of tourists has more than doubled in the last decade (3.5 million in 2019, according to the National Centre for Statistics and Information) and just over 3.5 million in the first eleven months of 2024. Banking activity in the region is predominantly controlled by six domestic banks and two Islamic banks. Additionally, there are nine foreign banks, although they typically operate only one branch each. The sector exhibits moderate concentration, with the largest bank, currently the sole domestically systemically important bank (DSIB), holding approximately 40% of total banking assets, as reported by the IMF.Overall, the banking sector remains robust, with profitability returning to pre-pandemic levels. Capital and liquidity buffers are strong, and asset quality remains solid. Banks' net foreign assets became positive by the end of 2023, marking the first time since 2014. In 2024, wholesale and retail trade grew by 7.1%, while financial services expanded by 3.5% (data NCSI).

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 6.1 40.2 53.7
Value Added (in % of GDP) 2.3 54.3 46.4
Value Added (Annual % Change) 6.9 0.1 3.5

Source: World Bank - Latest available data.

 

Find more information about your business sector on our service Market Reports.

 
 
Monetary Indicators 20162017201820192020
Omani Rial (OMR) - Average Annual Exchange Rate For 1 MUR 0.010.010.010.010.01

Source: World Bank - Latest available data.

 
 

Find out all the exchange rates daily on our service Currency Converter.

Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:
64,6/100
World Rank:
71
Regional Rank:
7

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 
 

Country Risk

See the country risk analysis provided by Coface.

 

Return to top

Foreign Trade in Figures

Oman's economy is highly open, with trade constituting approximately 101% of the country’s GDP, according to the World Bank. The Sultanate primarily exports hydrocarbons and petrochemicals but has been striving to diversify its economy in recent years, with an increasing share of industrial products in total exports. In 2023, exports of oil accounted for 57.6% of total exports, while liquefied natural gas recorded a share of 11.6%. Other exports included iron ores (2.9%) and fertilisers (2%). On the other hand, imports were led by petroleum oils (22.4%), motor cars (5.7%), iron ores and concentrates (3.6%), and telephone sets (2.3% - data Comtrade).
 
In 2023, the United Arab Emirates was the main export partner (6.4% of total exports), followed by Saudi Arabia (5.0%), India (3.8%), South Africa (2.4%), the United States (2.3%), and Egypt (1.7%); whereas imports came chiefly from the United Arab Emirates (26.3%), Saudi Arabia (12.4%), China (7.3%), India (7.2%), and Qatar (5.6% - data Comtrade). Oman benefits from high-quality port facilities that facilitate trade; however, slow procedures and rigid labour laws remain significant obstacles. Customs duties are relatively low, and there are few trade barriers in the country, with goods produced in Gulf Cooperation Council (GCC) member countries being duty-free if accompanied by a certificate of origin. The country has more than 105 agreements with countries around the world.

According to WTO data, Oman's goods exports totalled USD 62.7 billion in 2023, marking a 5% decrease from the previous year due to higher hydrocarbon prices, while imports declined at a faster pace (-5.6%), to USD 36.3 billion. Despite being a net service importer, the country maintains a structural trade surplus, although it is highly sensitive to fluctuations in hydrocarbon prices. According to preliminary data from the National Centre for Statistics and Information, merchandise exports grew 6.8% to OMR 24.2 billion in 2024, driven by an 18.4% rise in oil and gas exports to OMR 16.3 billion. However, non-oil exports fell 16.3%, with declines in minerals, chemicals, and live animals. Imports increased 12.1% to OMR 16.7 billion, led by higher demand for electrical machinery, mineral products, and transport equipment.

 
Foreign Trade Indicators 20192020202120222023
Imports of Goods (million USD) 23,50728,50730,99538,57336,382
Exports of Goods (million USD) 38,72433,47944,59166,06362,736
Imports of Services (million USD) 12,1128,1778,45310,607n/a
Exports of Services (million USD) 4,8982,2371,7332,787n/a
Imports of Goods and Services (Annual % Change) -3.4-8.913.319.6n/a
Exports of Goods and Services (Annual % Change) 1.9-14.612.216.5n/a
Imports of Goods and Services (in % of GDP) 37.044.842.641.4n/a
Exports of Goods and Services (in % of GDP) 49.547.149.459.2n/a
Trade Balance (million USD) 18,1928,08416,31631,31723,845
Trade Balance (Including Service) (million USD) 10,9781,8649,35722,80117,337
Foreign Trade (in % of GDP) 86.591.992.0100.6n/a

Source: WTO – World Trade Organisation ; World Bank , Latest Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2023
United Arab Emirates 6.4%
Saudi Arabia 5.0%
India 3.8%
South Africa 2.4%
United States 2.3%
See More Countries 80.2%
Main Suppliers
(% of Imports)
2023
United Arab Emirates 26.3%
Saudi Arabia 12.4%
China 7.3%
India 7.2%
Qatar 5.6%
See More Countries 41.3%

Source: Comtrade, Latest Available Data

 
 

Main Products

59.0 bn USD of products exported in 2023
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude 43.3%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 14.2%
Petroleum gas and other gaseous hydrocarbonsPetroleum gas and other gaseous hydrocarbons 11.6%
Iron ores and concentrates, incl. roasted iron...Iron ores and concentrates, incl. roasted iron pyrites 2.9%
Mineral or chemical nitrogenous fertilisers (excl....Mineral or chemical nitrogenous fertilisers (excl. those in pellet or similar forms, or in packages with a gross weight of <= 10 kg) 2.0%
See More Products 26.0%
38.8 bn USD of products imported in 2023
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 18.3%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 5.7%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude 4.1%
Iron ores and concentrates, incl. roasted iron...Iron ores and concentrates, incl. roasted iron pyrites 3.6%
Telephone sets, incl. telephones for cellular...Telephone sets, incl. telephones for cellular networks or for other wireless networks; other apparatus for the transmission or reception of voice, images or other data, incl. apparatus for communication in a wired or wireless network [such as a local or wide area network]; parts thereof (excl. than transmission or reception apparatus of heading 8443, 8525, 8527 or 8528) 2.3%
See More Products 66.0%

Source: Comtrade, Latest Available Data

 
 

To go further, check out our service Import-Export Flows.

 
 

Main Services

Source: United Nations Statistics Division, Latest Available Data

Return to top

Sources of General Economic Information

Ministries
Ministry of Commerce ,Industry and Investment Promotion
Ministry of Finance
Ministry of Energy and Minerals
Foreign Ministry
List of public organisations of Oman Government
Statistical Office
National Centre for Statistics and Information
Central Bank
Central Bank of Oman
Stock Exchange
Muscat Stock Exchange
Search Engines
Business Directory Oman
Google Oman
Sabla Oman
Economic Portals
Zawya News
Oman Economic Review
Muscat Daily Business News

Return to top

Political Outline

Current Political Leaders
Sultan and Prime Minister: HAITHAM bin Tarik Al Said (since 11 January 2020)
Next Election Dates
Shura Council: October 2027
State Council: November 2027
Main Political Parties
Oman does not allow political parties. The only political organisation, Popular Front for the Liberation of Oman, was dissolved in 1992, and remains dormant to this day.
Type of State
Absolute Monarchy (Sultanate)
Executive Power
Oman is an absolute monarchy in which the Sultan serves as both head of state and head of government. The hereditary Sultan holds broad executive powers, acting as prime minister and serving as minister of defence, foreign affairs, and finance, as well as supreme commander of the armed forces. The Sultan appoints a cabinet to assist in governance. In 2021, the succession process was reformed: for the first time, the position of Crown Prince was established, and succession now follows a primogeniture system, whereby the Sultan's eldest son becomes heir apparent.
Legislative Power
Oman's legislative branch, known as the Council of Oman (Majlis Oman), is bicameral but does not have full legislative authority. It consists of two chambers: the Council of State (Majlis al-Dawla), made up of 83 members including the chairman, all appointed by the Sultan from among former senior officials, academics, business leaders, and other notable citizens, serving four-year terms; and the Consultative Assembly (Majlis al-Shura), comprising 90 members directly elected by popular vote in single- and two-seat constituencies, also for renewable four-year terms. While both chambers review and amend draft laws, final legislative authority rests with the Sultan, who enacts laws by royal decree.
 

Indicator of Freedom of the Press

Definition:

The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:
133/180
 

Indicator of Political Freedom

Definition:

The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Ranking:
Not Free
Political Freedom:
6/7

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House

 

Return to top

Any Comment About This Content? Report It to Us.

 

© eexpand, All Rights Reserved.
Latest Update: May 2025