Oman » 

Beauty and the east

Originally published on www.businesstravellerme.com 16/03/2011 - Filed under: Tried & Tested » Hotels » Oman »

• Print
• Send

Sight-studded Oman is always wary of wholescale development but the Sultanate is now stepping up its infrastructural projects, reports Laura Collacott

It’s hard not to invoke the tortoise and hare analogy when comparing Oman with its next-door neighbour, the UAE. Everyone has seen the UAE’s glittering towers rise out of the sands and into the headlines, but Oman has taken a more sedate approach to development.

As it happens, there are lots of new projects in the pipeline in Oman which, for the past decade, has constantly had to balance economic development with cultural preservation, and interestingly, the two sectors are now converging to good effect.

“Oman is the cultural niche of the region and growth potential is vast,” said Yasser Noman, CEO Destination Management Middle East & Africa for Kuoni, which recently expanded its operations in the country.

Recognising the importance of a strong logistical skeleton in the development of an equally robust economy, the authorities have ploughed oil and gas money into a series of world-class infrastructure projects. ?In 2009, Oman invested $16 billion on local infrastructure and other projects; in 2010, that figure stands to be $18.5 billion.  Drive to or around Oman and you will find wide, well-constructed roads fit for carrying heavy-goods vehicles around the country as well as zippy little lease cars to the outstanding natural beauty spots. Just as well, since Oman is going to need them, with tourism set to account for three per cent of GDP by 2020.

Muscat and Salalah International Airports have this year announced the final stages of their tender processes to upgrade the facilities with both modernisation projects set for completion by 2014. Salalah will have a capacity of a million passengers per year and runway fit for the A380 – which may appear ambitious, but not when you consider it will act as a gateway to the Salalah Port and Freezone and stimulate economic development in the Dhofar region.

The capital’s airport will have a capacity of 12 million passengers per year (24 million after phase two, date not yet announced), 29 aircraft stands, state-of-the-art technology and a four-star hotel. In the North, Sohar is getting its own airport as part of mass Government investment into aviation, roads and ports, not to mention the national rail network currently under development.
 
The town that looks little more than a refinery backwater from the coastal highway has seen huge investment in recent years, mostly in its port facilities.

Authorities are hoping to turn the region into an economic player in the fields of mining, quarrying and mineral processing. An enormous, $250 million, deepwater jetty is under construction, with investment from Indian and Italian partners, that will allow ultra-large ore carriers to dock, bringing in the raw material to support the co-located iron ore pelletising and distribution centre. It might not be glamorous, but it is a substantial regional and global business and presents the business-minded with a host of associated investment opportunities.

To the South, Salalah Port is dramatically expanding its container and cargo terminal, as well as dry bulk and liquid capacities, spending an estimated $120 milion on the project. ?“Port of Salalah is expected to act as a catalyst for the economic and social development of the Dhofar region,” says Arjan Weerstand, Senior Manager of Project Development and Implementation at the port. “To date Salalah is doing well: we’re the second largest port in the region, the largest port in Oman and even ranked within the top 30 container Ports in the world.”

Some 90 per cent of world trade is conducted by sea, according to the International Maritime Organisation. Located just off the main trade route that carries goods from East to West, West to East, Salalah is ideally situated to become the major maritime hub it aspires to be, driving the national economy as it grows.

With trade and industry comes business, and with business, business travellers. Authorities have begun the tender process for the much-delayed Oman Convention and Exhibition Centre in Seeb, Muscat, 4km from the international airport, which will form ‘the cornerstone’ of Oman’s Integrated Tourism Development strategy, even if it still isn’t clear exactly when.

The 25,000 square metre exhibition space, 19 meeting rooms, 3,000 person auditorium, retail facilities, business park and four hotels are to be aligned with international standards to bring the country conference facilities that match its economic ambitions. ?Oman’s MICE scene is poised for significant improvement, exemplified by The Royal Opera House in Muscat (see box). Add to this whale watching, camel racing, hiking, outdoor pursuits and stunning landscapes which, together with the country’s natural and cultural wealth, make it an outstanding venue for incentive trips, appealing to a different visitor than its neighbours.
 
In the capital, the hotel offering has traditionally been aimed more at the high end and supply has been carefully controlled. The Shangri-La, Grand Hyatt, the Bustan Palace, the Chedi and other resident properties are soon to be joined by Fairmont, Kempinski, Hotel Missoni and Four Seasons as the tourism scene grows.  

But joining them for the first time is a range of mid-market hotels as Muscat seeks to diversify its offering for business and leisure travellers. City Seasons, Hotel Ibis, Park Inn and Millennium Hotels are all moving in.

Thomas Tapken, Managing Director of the City Seasons Group believes that the market remains relatively undeveloped compared with the rest of the region. “Oman presents a uniquely different product and has tremendous potential as an incentive and high-end leisure destination. It is also undergoing a major development in terms of tourism and leisure facilities and is fast becoming a sought-after destination for visitors globally.”

Accor hotels launched an ibis property in Muscat in 2009, one of the few ‘value for money’ properties to date. Christophe Landais, Managing Director of Accor Middle East, said bookings have come from both business and leisure users.

Two new major projects, The Wave and the Muscat Hills Golf & Country Club [where work on the first 9 holes of the Greg Norman, PGA standard golf course will be complete by the end of 2010], have greatly helped to improve Oman's image as tourist and business destination.

Although the country will face key economical challenges in the future, because of declining oil resources, it has already started a policy of diversification. In that respect, the tourism industry presents great potential thanks to good infrastructure that is currently being enhanced,” he adds, citing Sohar as the next target for a new business property.

Sohar currently boasts a modest range of hotels, from the Crowne Plaza to the four-star Sohar Beach Hotel, down to the two-star Green Oasis hotel. Radisson is set to arrive in 2012. It is prime for further development, as is Salalah. Though well furnished with Hilton, Marriot and Crowne Plaza all present, it stands to gain a Rotana in 2011 and Moevenpick by 2014.

Oman’s programme of diversification is comprehensive and established – it is the second most diversified economy in the GCC, after Bahrain. Oil and gas now contribute less than 50 per cent to GDP, making it a prime destination for foreign investment in alternative industries. Expect to hear more from Oman. Remember the tortoise had the last laugh.
 
Flying its own trajectory
Philippe Georgiou, Oman Air’s Chief Officer Corporate Affairs, says it has no intention of catching up with other rapidly expanding regional carriers. “We have a unique and differentiated positioning,” he says, by which he means attracting high-end travellers – in line with national tourism strategy – to Oman as a final destination, on a point-to-point basis with a boutique service offering.
One key differentiator, apart from the first class mini-suite, is in-flight connectivity with the development of its mobile, WiFi and broadband services.

“Oman Air was the first airline in the world to have included both mobile telephony and broad-band internet connectivity on board its aircraft,” says Georgiou. “Customers have reacted very well to this new feature, and are using the facilities in larger numbers.”

The carrier is taking on increased capacity – in that respect, it’s in line with its neighbours – and 28 per cent growth last year with the addition of 10 new planes. The company has recently signed a deal with Embraer to buy five aircraft with purchase rights for another five. Six Boeing 787 Dreamliners are also scheduled for delivery in 2014. ?As well as a sturdy inter-Gulf network, it now serves a range of international destinations with the latest, Milan, inaugurated in December, bringing the total number to 41.
 
Mapping the future
While Abu Dhabi has Vision 2030, Bahrain, Saudi Arabia and Kuwait have economic plans focused on 2030, Oman has got in early with Vision 2020. ?After oil fell dangerous low – below $10 a barrel – in 1998, the Government launched an active diversification programme to secure a broader economic footprint. ?Initially, this involved channelling gas revenues into infrastructure projects, and many of these projects have now been realised.

If you’ve driven to or around Oman recently, you’ll notice how dramatically the roads have improved, carving through the mountains.?The improved road network supports a wider logistics network linked to the seaport facilities that are being steadily developed in Sohar and Salalah to tap container traffic and, ultimately, international petrochemical producers to expand on its downstream gas activities. Salalah’s proximity to the trade route is critical to its success.

But so too is the Government support of industry, strong legal system and good international trade arrangements all stand the country in good stead for its goal of attracting vital Foreign Direct Investment.

The authorities plan to reduce the oil contribution to GDP to 9 per cent and increase the contribution from gas to 10 per cent.

They encourage export orientated, processing, precision engineering and knowledge-intensive industries. A tourism plan is aimed at attracting the upper end of the market through an emphasis on its geographical and ecological diversity.

Read more about...

• Muscat
• Oman
• Oman Air

Bookmark with:

ADD A COMMENT »