Macroeconomic Overview
The UAE and Oman share the longest land border within the GCC and maintain deep trade linkages. Oman’s economy is roughly one-fifth the size of the UAE’s, with higher hydrocarbon dependence and lower per capita output, but its strategic location on the Strait of Hormuz provides distinct logistical advantages.
| Indicator | UAE | Oman |
|---|---|---|
| Nominal GDP (USD bn, 2024) | 528 | 105 |
| GDP Per Capita (USD, 2024) | 53,700 | 21,300 |
| Real GDP Growth (%, 2024) | 3.9 | 2.6 |
| Non-Oil GDP Share (%) | 70 | 64 |
| Population (mn, 2024) | 9.9 | 4.9 |
| Sovereign Credit Rating (S&P) | AA | BB |
Trade and Logistics Infrastructure
| Indicator | UAE | Oman |
|---|---|---|
| Total Trade (USD bn, 2024) | 780 | 78 |
| Container Port Throughput (mn TEUs) | 19.4 | 4.2 |
| Major Ports | Jebel Ali, Khalifa, Fujairah | Sohar, Salalah, Duqm |
| Re-Export Share of Trade (%) | 30 | 8 |
| Bilateral Trade (USD bn, 2024) | 16.2 | 16.2 |
| Free Zones | 45+ | 8 |
Energy Sector Comparison
Oman’s energy sector is distinguished by its aggressive green hydrogen strategy. The Sultanate’s vast desert land area and favourable solar and wind conditions position it as a potential leader in green hydrogen production within the GCC.
| Indicator | UAE | Oman |
|---|---|---|
| Oil Production (mn bpd, 2024) | 3.2 | 1.0 |
| Proven Oil Reserves (bn bbl) | 98 | 5.4 |
| LNG Export Capacity (mtpa) | 6 | 11 |
| Green Hydrogen Target (mtpa by 2030) | 1.4 | 1.0 |
| Green Hydrogen Target (mtpa by 2050) | 15 | 8.5 |
| Renewable Energy Capacity (GW, 2024) | 5.6 | 1.8 |
Diversification and Industrial Policy
| Sector | UAE Contribution (% GDP) | Oman Contribution (% GDP) |
|---|---|---|
| Financial Services | 12 | 6 |
| Tourism and Hospitality | 12 | 3 |
| Manufacturing | 9 | 10 |
| Mining and Minerals | 1 | 4 |
| Fisheries and Agriculture | 1 | 3 |
| Logistics and Trade | 11 | 8 |
Special Economic Zones
Oman’s Duqm Special Economic Zone represents the Sultanate’s most ambitious diversification project. The zone combines a deep-water port, dry dock, refinery, and industrial area targeting heavy industry and petrochemicals.
| Indicator | UAE (Jebel Ali/KIZAD) | Oman (Duqm SEZ) |
|---|---|---|
| Zone Area (sq km) | 140 | 2,000 |
| Active Companies | 9,000+ | 300+ |
| Investment Committed (USD bn) | 100+ | 22 |
| Primary Sectors | Logistics, manufacturing, trade | Heavy industry, petrochemicals |
| Tax Incentives | 0% corporate tax in zones | 0% tax for 30 years |
Strategic Assessment
Oman’s development model differs from the UAE’s in its emphasis on industrial production over services. The Sultanate’s natural advantages in mineral resources, fisheries, and strategic port locations provide a foundation for manufacturing-led diversification that complements rather than competes with the UAE’s services orientation.
The bilateral relationship is characterised by economic complementarity. UAE capital flows into Omani infrastructure projects, while Oman provides industrial capacity and port access outside the Strait of Hormuz through Duqm and Salalah. This interdependence is likely to deepen as both countries pursue energy transition strategies.
Key Differentiators
The UAE leads on economic scale, services sector depth, financial infrastructure, and global connectivity. Oman leads on industrial zone scale, mineral resource diversity, green hydrogen potential, and strategic port positioning outside the Strait of Hormuz. The two economies operate as natural partners within the GCC framework, with growing integration in energy, logistics, and industrial production.