Focus on encouraging domestic travel in Oman

In addition to raising the overall awareness of Oman as a global destination and increasing the number of foreign visitors to the country, the Ministry of Tourism (MoT) and related agencies are actively seeking to tap the domestic market. By tailoring services specifically to locals, developing lesser known destinations, and creating specialised attractions and infrastructure, this push could have a strong impact on growing the number of nationals travelling around the sultanate.

GROWING NUMBERS: Domestic travel has been expanding at pace in recent years, with numbers tripling between 2005 and 2014, according to figures published by the National Centre for Statistics and Information (NCSI). Since 2012 the number of domestic holidaymakers has been growing at a rate of between 33% and 36% per year, Maitha Al Mahrouqi, undersecretary of the MoT, told OBG. Even so, authorities are focusing additional attention on this segment, with the aim of further developing domestic tourism in the short term.

According to the World Travel & Tourism Council’s “Travel and Tourism Economic Impact 2017” report for Oman, domestic spending generated 38.2% of travel and tourism’s contribution GDP in 2016. The segment was forecast to rise by 6.4% to hit OR584.2m ($1.5bn) in 2017, and by 2.2% per annum until 2027, by which time it would be worth OR727.5m ($1.9bn).

Meanwhile, spending within the country by international visitors was forecast to grow by 8.5% in 2017 to reach OR964.1m ($2.5bn), and by 7.6% per year until 2027, totalling OR2bn ($5.2bn).

STAYING HOME: At times in the year Omanis make up the bulk of those travelling as tourists in the country, for example, during the annual khareef (monsoon) season, when the rains turn the mountains around Salalah, the capital city of the Dhofar Governorate, into a verdant green landscape. Over the 2017 khareef season, which ran from June 21 until September 21, locals made up 71.3% of all visitors to the area, according to the NCSI, up slightly from 70.5% during the same period in 2016.

However, at other times of the year the role of domestic tourists, as well as the income they generate, has far less impact. In October 2017 the latest month with available data, Omanis accounted for 25.1%, or 33,913, of the total 135,000 hotel guests in the sultanate, down from 43,830 in October 2016, at which time they accounted for 29.6% of all guests.

For sector authorities, encouraging nationals to spend more vacation time in their own country rather than going abroad has become a key focus. Creating opportunities in local destinations, increasing marketing campaigns for domestic tourism sites and experiences, and developing new attractions is likely to attract more numbers, especially as recent instability in the region, and tighter budgets due to lower oil prices are leading many locals to reevaluate their travel plans.

In 2015 the MoT collaborated with leading hospitality players to launch an innovative three-day campaign targeting domestic summer holidaymakers. The campaign offered special discounts and package deals with more than 38 properties and service providers to Omani citizens and residents. Included in this drive are ongoing efforts to develop additional hotel capacity to appeal to a broader set of travellers. “The promotion of three- and four-star hotels will be a big factor in encouraging domestic tourism,” Srinith De Silva, CEO of Aitken Spence Resorts (Middle East), told OBG.

TOURISM STRATEGY: In early 2016 the government launched its National Tourism Strategy, with the aim of maintaining and growing its burgeoning domestic market, calling for the development of 14 tourism clusters to further expand cultural, ecological and urban locations. The targeted sites range from improvements to already popular areas, like Nizwa Fort, one of Oman’s oldest and best-preserved castle-forts, to the completely new developments (see overview).

Infrastructure projects, such as the addition of new roads and the widening of existing highways, are expected to improve the connectivity of attractions and make travelling across the country easier for both foreign and domestic sightseers alike.

In July 2017 the MoT announced that it would be launching 17 integrated travel stations in 2018. The project is designed to enhance tourism-related services and infrastructure, with a strong emphasis on encouraging nationals to set out on the various road networks to explore their own country.

The stations will feature hospitality and tourism facilities, with each station including a hotel, air-conditioned buildings for restaurants and retail, as well as information centres, rest areas, children’s play areas and separate prayer rooms for men and women. In areas of the country with less developed infrastructure, these initiatives are expected to go a long way towards improving the level of connectivity.

Additionally, the expansion of hotels and other related facilities could have a major impact. Duqm, for instance, located halfway between Muscat and Salalah, is experiencing a boost in investment in infrastructure, including the construction of multiple hotels, and is seen as having major tourism potential.

In addition, with the January 2017 launch of SalamAir, Oman’s first low-cost carrier, came three daily flights between Muscat and Salalah facilitating domestic travel possibilities. SalamAir offers links between Salalah and the northern port city of Sohar with ambitious plans to expand the number of its domestic and international routes in the near future (see analysis).

In 2016 the total number of domestic flights increased by 29%, with domestic passenger numbers up 20.3%, from 549,100 in 2015 to 660,798, meaning more Omanis were flying between domestic destinations for work and leisure. This trend continued into the first nine month of 2017, with domestic flight numbers growing by 28.6% year-on-year, from 7295 to 9378.

NEW DEVELOPMENTS: Locals are increasingly being seen as the most important tourist market by industry insiders. “You need to take into consideration that our primary target market is an aspirational Omani audience,” Paul Jessup, vice president of sales and marketing at Muscat Bay, an integrated tourism complex, told OBG. “Currently, those wanting to do something different on the weekend don’t fly to Salalah, they drive to Dubai.”

Jessup also pointed to the 4.2-sq-km Oman Botanic Garden being built in Al Khoud, some 20 km outside Muscat, as an example of where the country can create something big and bold. The preliminary designs for the garden were unveiled in November 2017, and upon completion it will be the largest ecological oasis on the Arabian Peninsula and one of the largest in the world. Located in the foothills of the Al Hajar Mountains, the site will feature habitats that showcase the eight regions of the country, with guests able to explore the flora of various wadis (valleys), mountains and deserts in the space of a day, including a space to mimic the rich green forests around Salalah during the khareef season. The overall site, which will help to celebrate and conserve the country’s geography and botanic diversity, is likely to become a major draw for both international and domestic visitors. Indeed, efforts to exploit the country’s natural environmental landscapes are part of the push to attract more people. “As part of its ongoing diversification efforts, the government is doing more to market the sultanate’s varied geography,” Awad bin Mohammed Bamkhalif, CEO of Oman & Emirates Investment Holding Company, told OBG.

Another development likely to appeal to a domestic audience is the country’s first waterpark, which opened its doors in January 2018. Located in Salalah, Hawana Aqua Park features a host of water activities, a food court, retail shopping area and entertainment facilities, with the overall aim of providing a day-long destination for visitors. The park has a capacity of 500 people per day, with a lazy river, wave pool and spa pool. In January 2017 a OR3m ($7.8m) expansion project was awarded to Wasal Development and Investment Company to build a five-star hotel, commercial complex, a multipurpose hall and restaurants at the park. “Oman should foster a well-diversified offering. For example, theme parks and attractions would further consolidate the sultanate’s position as a tourist destination,” Khalid Al Yahmadi, CEO of Muscat National Development and Investment Company, told OBG. “The development of Oman’s tourism sector would benefit from projects that are bold but also stay true to the sultanate’s heritage.”

LOOKING AHEAD: The development of these kinds of new attractions, as well as the renovation of historic and cultural sites, is likely to appeal to both foreign and local tourists, and could significantly raise the number of Omanis that choose to spend their leisure time within their own borders. “To keep Omanis in the country at the weekends, we have to create excitement and build unique experiences that will interest the public with assets that connect local discoveries to future aspirations – not just copies of Dubai,” Jessup told OBG.

While visitors from overseas are always likely to represent a significant share of the local market, ongoing efforts to expand the role of the domestic tourism sector could have a strong impact in the years ahead.